Group Chief Financial Officer, Ryanair
Ryanair Will Continue to Prioritize Increasing Market Share, Says CFO
Feb.04 -- Neil Sorahan, chief financial officer at Ryanair, discusses the company's 3Q loss, why they’re still a growth story, expanding through acquisitions and his contingency planning for a hard Brexit. He speaks on "Bloomberg Daybreak: Europe."
About Neil Sorahan
Neil Sorahan, Group Chief Financial Officer at Ryanair, stated on May 19, 2026, that the airline does not anticipate cancellations this summer and is confident in maintaining a full schedule. He attributed this to improved alternative jet fuel supplies and the airline's hedging position, noting that Ryanair is 80% hedged out to the end of March next year at $668 per metric ton, down from $760 per metric ton the previous year. Sorahan said that oil supply concerns have eased due to changing supply chains, with suppliers sourcing oil from the Americas, the Nordics, West Africa, and parts of the Middle East, reducing dependency on the Strait of Hormuz. Sorahan discussed Ryanair's financial position, stating the airline will be debt-free the following week after paying off its final bond. He described the company's strategy as "load active, yield passive," meaning it prices to fill planes, and said Ryanair has never had a fuel surcharge and does not plan to introduce one. He predicted that market prices will inevitably rise and advised customers to book early before winter price increases. Regarding Boeing fleet delays, Sorahan said the manufacturer delivered 29 aircraft over the winter, allowing Ryanair to operate all 210 of its "game-changer" aircraft this summer, and expressed optimism about the certification of the Max 10. He added that Ryanair's competitors "are going to struggle significantly" due to their lack of similar hedge lines, balance sheet, and cost base.
Transcript (12 segments)
✨ AI-enhanced transcript with speaker attribution
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Interviewer0:00
So we've heard the news there, we've heard about the loss. You talk about price competition in the statement as well. So how are you actually going to respond to this? Could you cut some routes and bases?
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Neil Sorahan0:12
We're already growing very strongly. You've seen we grew passenger numbers by 8% in the quarter to 33 million. We increased our passenger target a couple of weeks ago to 142 million. So we're going to do what we always do: we'll have the lowest fares, we're going to do it at the lowest costs, and we're going to grab market share. And that's exactly what we're doing at the moment. Never been a better time for our customers. Average fare is just under 30 euro, and regarding fares, down another 7% over the winter. There's a huge amount of overcapacity in Europe at the moment, and I think some of that capacity comes out. Some of it's been helped by lower fuel. Fuel has dropped from $80 a barrel to $60 a barrel. So until that capacity comes out, we're going to see fares under pressure, and we're going to continue to do what we do: grow market share.
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Interviewer0:52
So you say you're going to continue to see fares under pressure until that capacity comes out. Does that mean that this price competition is going to actually depress your margins in the summer as it has for the winter?
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Neil Sorahan1:04
Well, at this point in time, we wouldn't have a huge amount of visibility into the summer. Some of our competitors have been a little bit more bullish on summer trading than ourselves. We have about 17% of our bookings in place for the six-month period April to September, about 1% better booked than this time last year. But the trend at the moment, and I have to say you don't have a huge amount of visibility, the trend is that fares are on the way down. We're seeing fares down approximately 1% over that period of time on the same time last year. That said, we don't know what close-in bookings are going to be like. We won't know that until we get closer into the summer. But barring fuel rising significantly or some of the weaker competitors going out of business, I think overcapacity is going to keep fares very suppressed for the next number of months.
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Interviewer1:53
Good morning to you, good to have your voice. I've written down here: Ryanair, an IAG, was almost a legacy carrier. Tell me why you're still a growth story. You've had disputes, scheduling issues, tumbling fares—that's the hallmarks of legacy. Tell me why you are going to be a reinvigorated growth stock.
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Neil Sorahan2:13
Well, I can give you 210 reasons as to why we're going to be a reinvigorated growth stock. We've got our game-changer aircraft starting to deliver in April of this year. We've 210 of them on order. That's going to see us grow from 142 million customers this year to 200 million customers by March 2024. Lauda Motion, our latest acquisition in Austria, which will carry 4 million customers this year, is increasing to 6 million next year, 7.5 million the year after that, and profitable growth. So we've got a lot of reasons as to why we're a growth story. We'll go from 15% market share to in excess of 20% market share over the next five years. So as I said, 210 good reasons there.
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Interviewer2:59
You mentioned Lauda Motion. And how much of that growth that you're talking about is going to come through expanding through acquisitions, if you're expecting more carriers to become available?
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Neil Sorahan3:07
Yeah, the vast majority of our growth, as has been the case in the past, will be organic. We do that very well. But where we see opportunities like the Lauda Motion deal to do something that helps us get into markets that we might not get into as quickly—Lauda, for example, is in Vienna. We weren't flying in the Austrian market. It gave us opportunities to fly Airbus aircraft. We're a Boeing operator prior to that. That's quite interesting. That opened up a number of very important slots down in Palma de Mallorca and in the German market, where we're growing quite strongly. So if we see opportunities like that, we look at them. I don't see us being a big player in the M&A space, but what I do see is that we will manage to pick up Lauda Motion-type airlines on the back of consolidation. It's going to happen over the next four or five years, and I think we're moving very much towards a situation similar to the U.S., where you have four or five majors operating 70-80% of the market. I think Europe is a little bit slower getting there, but we're moving in that direction over the next few years.
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Interviewer4:03
There's lots of discussion around Brexit. You've secured licenses to fly three of your UK domestic routes, so you're putting your house in order. Just give me a sense of what kind of contingency planning you really are doing for real within Ryanair if there was a hard Brexit on March 29th.
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Neil Sorahan4:24
Yeah, well, the key issue, I suppose, one of the key issues, is whether flights would actually fly. That appears to have been resolved at this point in time, at least for a number of months. So as regards securing the UK operations, we in December received a UK Air Operator's Certificate, which, as you said, secured us the domestic flights here in the UK. It would also enable us to fly to what are called third countries outside of the UK, the likes of Morocco, Jordan, and elsewhere. Similarly, we have a strategy in place in relation to our majority EU ownership and control. All EU airlines have to be majority owned by EU nationals. So we have a strategy which will enable us to retain that in the event of a hard Brexit. What that will involve is that our non-EU shareholders, of which the UK unfortunately will be a part of that, will not have voting rights at our AGMs for a period of time and will be forced to sell down to EU nationals.
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Interviewer5:23
Neil, final question on M&A: are you thinking about making an approach for Norwegian Air?
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Neil Sorahan5:27
I can't comment on rumor and speculation, but I think Michael has been clear in the past: we don't catch falling knives.