Ryanair Holdings Q4 2026 Earnings Call | Record Traffic Of 200M Passengers Drives Profit Beat

Ok, good morning ladies and gentlemen, welcome to the full year results analyst conference. I'm joined by all the team from London, Dublin and various other sites around Europe. As you've seen earlier this morning, we reported a record full year profit of 2.26 billion, which is a rise of 40% over our prior year profit after tax of 1.66 billion. The highlights were a traffic growth of 4% to a new record figure of 208.4 million, that was achieved despite delivery delays on 29 Boeing Game Changer aircraft during the year. Incredible costs have been unit cost rose only 1%. Looking forward for the next 12 months, we've covered 80% of our jet fuel at about $67 per barrel, $668 per metric ton. We took the last 29 of our 210 Game Changer order, so we have 647 aircraft in the fleet at the 31st of March and we declared a dividend of 19.5 cents per share, payable in September subject to AGM approval.

Obviously we've had a record year with these results, but they've been overtaken obviously by the conflict in the Middle East. Like everybody else, we don't know when the Strait will reopen, but Europe remains very well supplied with jet fuel. Significant, almost all of Europe's jet fuel is now sourced from West Africa, the Americas and Norway. Our very conservative jet fuel hedging strategy, as said, under which 80% for the next 12 months is hedged at $67 per barrel to April 2027, will insulate the Ryanair Group earnings from the current volatile oil market and will significantly widen the cost gap over our EU competitors for the remainder of FY2027.

As you'll see, the balance sheet remained strong with a triple B plus credit rating from both Fitch and S&P, with an unencumbered 737 fleet of 628 aircraft, 20 aircraft at the 31st of March. Gross cash was 3.6 billion and this was after spending 1.9 billion on CapEx, 1.2 billion on debt repayments and over 900 million in shareholder distributions over the last 12 months. Net cash was 2.11 billion at year end, which enables the group to repay our very last 1.2 billion bond next week before the end of May, which leaves our group effectively debt free, which is a stunning achievement by any non-government owned airline.

During FY26 we purchased and transferred another 2% of our issued share capital. We've retired 38% of Ryanair's issued share capital since 2008. The final dividend of 19.5 cents is payable in September subject to AGM approval. Our priorities with our cash over the next 12 months are obviously firstly to fund the final bond payment in May, to fund our MAX 10 aircraft deliveries over the next 12 months, to pay down dividends and continue to fund the balance of our 750 million buyback program at favorable lower prices recently.

While rebuilding internal cash flows, the group's cash will get back to 4 billion on the pre-pandemic growth. As we said at the year end, we have 647 aircraft which includes 210 Game Changers, all of which are debt free and unencumbered. Boeing are making very positive noises about the MAX 10 certification, which they now expect to take place at the end of Q3, early Q4 2026. They've also confirmed in writing that they expect to deliver Ryanair's first 15 MAX 10s in the spring of 2027, in line with the original contract dates.

We take 300 of these efficient aircraft, all of which are due to deliver by March 2034. They will transform the economics and operating cost of Ryanair. They enable us to offer 20% more seats to the market, but they burn 20% less seat-mile fuel per flight. We have 80 new routes on sale and three new bases in Rabat, Morocco, Tiranë in Albania and Southern Sicily. Our scarce FY27 capacity growth, or summer 2026 capacity growth, is allocated to those regions and airports who are actively cutting aviation taxes, like Sweden, Slovakia, Albania and regional Italy, and are also where airports are incentivizing traffic growth. And we're switching our scarce capacity away from uncompetitive high tax markets like Austria, Belgium, Germany and regional Spain.

The board and myself commenced discussions on an extension of my employment contract, which currently runs until 2028, that runs out until April 2032. We recently concluded an outline agreement and the board will commence engagement with our largest institutional shareholders in the coming days. The key feature of the contract extension is I will have purchase options over 10 million shares. But these will only vest if we achieve very ambitious profit after tax and share price growth targets over the next 6 years before 2030. If we do, we will create very substantial capital value for all shareholders.

Turning briefly to the outlook. We expect FY27 traffic to grow about 4% to 216 million passengers. A key feature of the next 12 months is that 80% of our jet fuel has been hedged at $67 per barrel, which is lower than last year's $76 per barrel price. However, the price of our unhedged fuel is exposed to the Middle East conflict. Our EU and national taxes are also expected to rise by 300 million year to 1.4 billion, which makes EU air travel even less competitive than it was before.

Like all of the European airlines, we're calling for either the abolition of ETS or bringing ETS taxes in line with CORSIA rates, which is what the non-EU airlines pay. It makes no sense that European airlines and passengers are taxed so discriminatorily compared to our non-EU competitors. Our maintenance costs will rise modestly due to an aging NG fleet and mid-life hospital business on the LEAP engines. There will also be some significant crew pay increases agreed this year. We recently completed five-year pay deals with our Italian pilot and cabin crew and we're in active negotiations with a wide number of other national pilot and cabin crew unions and we expect to agree follow-on deals with those over the coming weeks and months.

If the unhedged fuel prices remain at current elevated levels throughout the remainder of FY27, then unit costs could rise by a mid-single digit percentage, and that would still demonstrate incredible unit cost discipline. To date, our summer 26 travel demand remains robust. Although bookings since the war in the Middle East have are closer in than they were last year, which reduces visibility. Pricing in recent weeks has eased somewhat in response to economic uncertainty caused by higher oil prices, far too much media attention about the fear of fuel shortage, which we believe does not exist, and the risk of inflation adversely impacting consumer spending.

The trend we've been seeing is that further out into June, July, and August we're having to marginally discount pricing, you know, maybe one or 2% to keep the forward curve rising, but the close-in bookings in early mid-May are strong and pricing is strong. With the first week of Easter falling into March, which benefits Glassengers Q4, we now expect Q1 fares to be behind Q1 FY26 by a mid-single digit percentage.

With constrained EU capacity, short capacity due to OEM delivery delays and with the engine repairs, we originally expected S26 fares to rise modestly. We thought they'd be in the low single digits after a 10% fare increase in the prior year. However, Q2 pricing with limited visibility is now trending broadly flat and the final outcome will be totally dependent on peak summer 26 bookings and fares. With zero H2 visibility and significant fuel price potential supply volatility, it's far too early to provide any meaningful FY27 guidance at this time. And with that, I'm going to ask Neil, the Group CFO, to take us through the MD&A. Neil.

Ok, thank you. And with that, we ask the moderator to open up for Q&A. Please limit everybody obviously to two questions as normal so we get through this in about an hour.

Thanks. There's two questions there. Look, the thing that overrides these records this morning, record profits, record growth, is the war in the Middle East. And you know, frankly none of us know when that will finish or when that will wind up or when the Strait moves will reopen. It's therefore sensible for us to be very conservative. So we're saying this morning if the war in the Middle East and the Strait moves remain closed until the end of March 2027 and oil, jet oil remains at $150 a barrel, then our unit cost might rise about 5%. If that happens, there will be about three or four airlines left flying in Europe. We are by far away the best hedged airline in Europe. There's a lot of our competitors who are significantly poorly hedged. Most of them are hedged to the end of September, October with very little hedging in place through to the winter months.

But I do not expect the Strait of Hormuz moves to remain closed until March of next year. The US has midterm elections in November. I have been reliably advised by a number of senior US politicians that Memorial Day at the end of May is when those midterms kick off and that there will need to be a resolution of the situation by the end of May. However, if it does continue over those 12 months, there will be significant airline failures in Europe this winter. Mainly from some competitor airlines who offer low fares but don't have low costs, have very stressed gearing on their balance sheet and are not as well hedged as Ryanair. And you see already many of those airlines are cutting capacity, you know, they cut capacity up to 5-6% during April, May and into the June quarter.

We are not cutting capacity, we are continuing with our own 4% traffic growth and we will expect to continue that through the summer again, taking advantage of our very strategically strong fuel hedging position. And I would expect us to grow strongly. If oil, unhedged oil remains higher for longer, there might be a slight dip in profitability, but we're talking slight dips, not anything that reflects the recent 20-25% in the share price. So we see this as an enormous buying opportunity. We continue to be shareholders. I wish we bought the last time there was a dip, but here's the dip and here's your chance. And we are continuing to exercise our buyback and we're getting tremendous value for shareholders by buying back stock in the market at these current prices.

Do I think there'll be more aircraft? I'm not sure, Stephen. It was interesting, I was talking to the aircraft lessors a week ago who had taken aircraft back from the Spirit failure in the US. One of the interesting things was they had repossessed 25 aircraft. They'd taken the 50 engines off 25 aircraft and put them into the engine pool. They seem to be able to make more money out of spare engines than they are even leasing second-hand aircraft. We expect the current crisis to worsen the capacity situation in Europe and the capacity situation in Europe was already significantly muted this year.

We had originally thought that would lead to higher pricing. I still believe that will lead to higher pricing, but only when there's a resolution of the war in Iran and the straits have almost reopened and then I think our pricing will rebound strongly and our unhedged fuel will fall significantly. But we're not there yet and we don't know when that will happen. Would Boeing like to turn around and offer us more MAX 10s? Sadly, no, because they can't make them fast enough at the moment. They said to get it certified at the end of this year. Now will there be more MAX available? Highly unlikely. I mean there's a huge backlog of demand out there for the two OEMs, Airbus and Boeing. None of many spare aircraft availability this side of 2031, 2032.

But as Neil said, we would always be opportunistic if there was, you know, somebody was distressed and came to us offering us, you know, very low cost 737-8 or -10, we would certainly look at it and that's why we continue to maintain a very strong balance sheet. I should say we have had since the war in Iraq, we've commenced negotiations on reasonably modest extensions of the Airbus, the 26 Airbus fleet in Lauda. Most of those aircraft leases end 28-29, we're extending them at the moment out to 2030 just so that we can match their retirement into the deliveries of 40 when we get up to the 40 or 50 aircraft deliveries from Boeing.

You see this morning we pulled back the traffic growth through FY27, FY28 and FY29 because Boeing can only deliver 15 aircraft each spring in those two years. By the time I get to FY30, they're delivering 40-50 aircraft and then I can resume strong capacity growth in Europe and take out the Airbus aircraft if we can't find newer or younger aircraft leases to replace the A321. So we see lots of opportunity out there in the current climate. Our guidance, I think it is sensible to assume a worst case and the worst case is that the war will continue and the straits of Hormuz will remain closed until March of 2027, but frankly none of us believe that will be the case. So I think there's nothing but upside at the moment in our trading outlook and there's nothing but upside in our share price guarantee. Thank you. Next question.

Thanks. Let me take the second half of the question which is the unit cost increase, which is almost largely fuel. But nevertheless, let me talk about pricing into Q2. Like we're reflecting what is a trend we've seen develop over the last, I would say, six weeks. Previously we were seeing, you know, modest mid-single digit increases in pricing into the July, August, September quarter. I think what has happened with the war in Iraq, in the Middle East, is there's been a degree of passenger hesitancy. You've lots of people who may already have made bookings to go long-haul or across the Gulf carriers into the Middle East and they're holding off, will it clear, what will happen.

We think that will break very much in favor of European air travel as we get to the school holidays. Now it'll break in favor of European air travel, we believe, and we think we're vindicated with the strength of the close-in bookings, both volumes and pricing during May. We had another very strong weekend to book this weekend, we finished 50,000 bookings ahead of the target. Again, strong close-in pricing, strong close-in volumes, but we were a little bit off. I mean, you know, you're talking maybe 1 or 2% of the forward bookings out into June, July, end of June, July, August compared to this time last year. And we think people, I mean lots of people are just waiting to see what will happen, will it be safe? Can I travel?

Now I think two things come from that. One, people will travel and, you know, families will go on holidays. The question is will they go on holidays long-haul or to the Middle East or will they stay at home and go on holidays in Europe? And we think they will stay at home and go on holidays in Europe. So, you know, I am generally one of life's optimists. I think the war in the Middle East will get resolved in the next month or two and then I think you will see both a decline in spot oil prices and a reasonable surge in bookings through to the mid-summer. But I'm guessing, that's not guidance at the moment, it makes sense for us to guide based on what we presently see, which is flat pricing and unit cost if it continues for the full year of 5%. But I think that is likely to be a worst case scenario and I think there's lots of upside in those numbers if the war, if the straits reopened and oil prices settled back. Not, I mean they won't go all the way down to $67 a barrel immediately, but I do believe they will settle down well under $100 a barrel by the time we get to the back end of the summer.

Thanks, Eddie. Thanks. Next question please.

Thanks very much. Let me run through those briefly. And there isn't much difference on the regions, I mean you take our own scale. I think the real trend for us this summer is that we're switching capacity away from countries. We're closing the base of Berlin in October. We're closing the base of Thessaloniki. We're taking aircraft away from regional Spain, France, Vienna, the base is reducing. So any of those countries who still have environmental tax on air travel or high airport fees, we're switching capacity away from those and their traffic is in decline. For example, Vienna last week reported April traffic down 8%, we're switching capacity away from those airports.

In place for those airports, in places like Sweden, remember the home of Greta Thunberg and flight shaming, new transport has abolished aviation taxes up there. Malta has introduced a very imaginative growth scheme and growing like gangbusters up there. Similar situation in Slovakia recently where they're abolishing municipal tax and Albania where they not alone abolished aviation tax, cut AGC fees and the airport has introduced a growth incentive available to all airlines which we are gobbling up very rapidly. So, but that doesn't mean there isn't, even in those new markets that are growing strongly, there is a degree of hesitancy out into June, July, August. And I think, you know, it's not any major downturn, but this time of the year we're having to slightly open up a little bit on pricing just to keep that forward booking curve in line with our own internal targets and we're running, you know, 0.2% ahead of our targets for May and June. We're bang on that target for July, August and September. So we're very confident where we are.

We're seeing this kind of trend for about the last two months. Further out, we're having to do a little bit of price discounting to keep the volumes going. And that's even while our competitors are taking out up to 4-5% of their own short-haul capacity. So there is a little bit of customer hesitancy out there. We think that will break in favor of stronger bookings and pricing as we move through June, July and August. But it very much depends on what and when the war moves and the conflict in Iran ends.

Fuel shortages. I think there was a real concern there about a month, two months ago in Europe. At this point in time, and we do regular weekly meetings with our fuel team, in Paris at the conference last week, we now have almost zero concerns over fuel supplies across Europe. The only area where a slight reservation is Kuwait, which is the oil subsidiary of the state of Kuwait, has about 25% market share in the UK. Even they are now switching their supplies or their imports to the Americas away from the Middle East. And so Europe is now essentially fully supplied with jet fuel, jet A1 coming from West Africa, Norway, the Middle East and some of the Central Asian and European countries are taking jet A1 from Russia. So we do not now see any real risk to supplies.

In the case of Kuwait in the UK, our other large oil suppliers in the UK have said they will be able to supply us with fuel if there was any disruption with Kuwait. But we don't really, the Kuwaitis are recently confident they will be able to meet our supply in full through the summer season. So I think our concern over the risk of jet fuel shortages has now receded and the challenge remains price. And price is very volatile as you all know and we think that that will break meaningfully if there is some resolution of the congestion around the straits of Hormuz. And if it doesn't, I think you will see meaningful competitor failures or very dramatic capacity cuts from competitors who will be running out of cash as we move to the end of the summer through August, September, October. And then there was the last one on competition.

I mean, I just called you a man never to waste a crisis, if you're sort of thinking about stamping your... We never ever, I would say, you know, expand or take advantage of competitors, do something or deploy capacity based on what competitors are doing. We couldn't care less. We deploy capacity based on where the airport incentives are at their greatest and we have been struck with the extent to which, for example, you know, Albania, Tiranë, which was a, you know, it has a 12 aircraft winter base, are really very concerned like a lot of European airports about some of their incumbent carriers' viability or survivability and they are getting very aggressive with the incentives or the growth incentives they're putting in place.

We've seen that play itself out across Europe. We also see it now very prominently in the Baltic States. So there are a number of, I would characterize our expansion this summer as not enough to put pressure on competitors, but rather taking advantage of unique growth opportunities that are now being made available to us because a number of our airport partners are becoming increasingly concerned either at a reliance on some of our flaky competitors or they've said this to us themselves, are genuinely worried some of our flaky competitors might not survive this winter. Mind you, would they be right at that? So but we deploy capacity based on those markets where aviation taxes are being cut and airport incentive schemes are being improved. Thanks for the question. Next question please.

You broke up, you were saying the outlook on profit per share, was there a period, did you say a year there or no? So if I, correct me if I'm wrong, but I think previously you said you expect that to get to the 12 to 14 range in... So how are you thinking about that environment which could take capacity from other, what are the moving parts given that environment right now?

Yeah, sure. Thanks for me. Okay, let me take two of those. I'll start by, we're about 600 million through the existing, 80% of the way through the existing 750 million buyback. We expect to complete that buyback. We're pretty much, we're very fettered in the way we can manage buyback. So it all has to be board approved, announced to the market that we buy a certain percentage of the daily trades. And we continue to do that. Nevertheless, I think the war in the Middle East has been very helpful to us. It has brought the average cost of that buyback in the earlier days down from about 28.50 a share. We're now down around 26.40 average price per share.

Would we step up and come up with a new buyback in the next three or couple of quarters? I think it's highly unlikely. Remember our big, kind of the big deployment of cash currently is to fund repayment of the final bond debt. And to put that in some context, we're going to repay a 1.2 billion bond, a bond we threw down during COVID. We pay only 0.85% on that, but if we were to try to refinance that today, the cost would be about 4%. I think it is, you know, it demonstrates the strength of the Ryanair business model and our cash flows. We came out of COVID with 4 billion of gross cash and in the last five years we have now paid down that 4 billion of gross debt over the last 5 years while funding pay, while funding buybacks, while funding shareholder dividends and also funding gross CapEx on the remainder of the Game Changer fleet.

If I look forward over the next four years, so I don't think we'll do another share buyback in the next couple of quarters or certainly not before at the end of this calendar year. But we're then looking into a period of three to five years where I think we continue to be very strongly cash generative, but we have no bond debt to refinance. We also have a two-year kind of CapEx holiday through FY28 and FY29 taking 15 MAX 10s. So you can take that there will be a continuation of both dividends and very strong buybacks with our spare cash through FY28 and FY29. But not this summer. This summer we're using the buyback cash to pay down the last of our bond debt of 1.2 billion and that gets paid down next week.

What do I think of the outlook of our 12 to 14 euro profit per share? I think it remains unchanged. This is a short-term shock to the system. You know, the war in Iran was somewhat unexpected by the market, certainly the closure of the straits of Hormuz. This is no different to what we've seen before with 9/11, the Gulf War, the second Gulf War, Russia's illegal invasion of Ukraine. There's been a short-term fuel spike. What happens is a short-term fuel spike, Ryanair's hedging comes to the fore which protects the vast majority of our earnings during that period of volatility and then the situation resolves as oil prices refix and everybody goes back to normal again.

Will there be a disruption this year? Again, it's too early to say even because we don't know how long the straits of Hormuz will remain closed. If I suspect is likely to be the case that Trump will find some resolution or declare victory by the end of May when the midterm electioneering kicks off, then I think, you know, we will, I would be more optimistic than our current guidance of unit cost going up by, you know, mid-single digits this year. I think we do better than that and I think you see more confidence return to passenger bookings and pricing during the summer. But much depends also what happens this winter with our, you know, the flaky competitors around Europe, the ones who are not particularly well hedged, the ones who have very large net debt positions. I mean one of our airline competitors has recently borrowed 30 million from its local government just to get it through the summer trading period. That loan is due to be repaid in August, there is no possibility that loan being repaid in August. So I would expect competitor failures in Europe.

And then who knows, maybe the 12 to 14 euro profit per share will actually come forward because there would be even more constrained capacity in Europe and stronger pricing. But like everybody else, we're in a short-term period of uncertainty. We hunker down, we trade on the strength of our balance sheet. But if you look at our record over the last four years, five years, when we have paid 4 billion of bond debt. As I look forward into the next four or five years, we have no bond debt to repay and that kind of cash generation will be available and the board has been consistent over the last five years in saying if there is surplus cash it will be deployed to pay down debt. We now have no more debt to pay and the balance will be returned to shareholders through dividends and share buybacks. But I would not expect another or a short-term buyback. We're very content to finish out the current program which we say will happen by sometime mid to end August before the AGM and then pay down our bond debt and then I would look forward into calendar 2027, calendar 2028 the resumption of reasonably strong buyback activity if profitability and cash flows return to some pre-Eastern war norms. Thanks. Next question please.

Ok, than that's an opportunity. Neil, will you take the question for the next couple of years and then I might ask Eddie Wilson, the Ryanair CEO, to comment on airport charges. Eddie, in terms of airport charges in our discussions for the next two or three years.

Wonderful, thanks very much. Can I just add to that, you know, give you a flavor, an airport like Sweden which, you know, four or five years ago was nobody wants to fly anymore, we all had flight shaming etc. etc. You got a really good new transport minister up there going, this is stupid, we're losing business. He abolished the environmental tax. Ireland, you know, introduced very imaginative traffic schemes. Tirana for example, they abolished the tax and grew inventive schemes. And you look at somewhere like Dublin, you know, just a bunch of idiots, you know, they have a traffic cap that they've been sitting on for the last 20 years. Government promised 18 months ago to remove it as soon as possible. 18 months later, done nothing. And then these dumbos in Dublin have come up with a capex program of 5.6 billion for the next 5 years. 25% of that, about 1.5 billion, is an allowance for inflation and contingencies over the next 5 years. Now there is a risk that inflation might take up from 2 to 3% but it's not going to cost an extra 1.5 billion. But that's the kind of messing that these regulated monopoly airports are with. And as we said last week if that goes ahead we simply will stop growing overnight, we will stop growing in Dublin and the minute we stop growing in Dublin, Dublin doesn't grow. We have lots of other airports in Sweden, in Albania, Slovakia for example. Again the new government in Poland, the environmental taxes, ATC fees by nearly 50% and the airport has significantly reduced its airport fees. We as a result switched a load of aircraft out of Vienna up the road to Slovakia and in April the end traffic went down by 8% and Slovakia recorded a record 170% growth in traffic April over April. So I would expect those discussions to continue to play out over the next couple of years while morons in Dublin and the likes of them, you know, come up with, game the regulatory system by coming up with these absolutely stupid, for example they want to spend nearly a billion in Dublin putting air bridges on the Ryanair terminal despite the fact that we don't use air bridges and we deliver 80% of the traffic through that terminal but they have come up with this one, the majority of airlines using one want air bridges with the fact that the airport that delivers the air, delivers 80% of the traffic won't use them and won't pay for them. But the great advantage we have is the strength of our terminal negotiations and as I said the strength of our pipeline of 300 aircraft deliveries. No airport in Europe, if it wants to grow, most of them now recognize they need to encourage Ryanair to grow there because we're the ones that need to be deploying 40, 50 aircraft a year and some of those aircraft deployments will involve taking aircraft out of Dublin and deploying them somewhere else unless somebody in our useless government eventually passes the legislation abolishing the tax and finally takes a stick to these morons in Dublin airport who think, you know, they just keep pissing away billions and the customer will pay. They won't.

Thanks Harry. I mean give you a flavor of what's going on. If you take say for example the month of April, you know, and April was weak, was artificially weak this year because the first weekend of the April school holidays fell into March. We entered April about 0.2% where we were ahead of target but despite the fact that Easter was early in April, the closing bookings were stronger and stronger. We finished up the month about 0.5% ahead of target. Now half a percent is sort of like 100,000 passengers. So we finished off with 100,000 passengers ahead of our passenger target for the month of April and that was all thanks to stronger, very strong close near-term booking and stronger pricing. However, if we are at the moment, if pricing remains weaker out through June, July, August, we're having to marginally, and I keep emphasizing this, you know, we're having to maybe take 1% or off the pricing, you know, to keep the further out bookings building and then the close-in is strong and the pricing is strong and we still see that finishing up if that continues through those three months of June, July, and August and I don't think it will because I don't need the stress of it but the uncertainty in the Middle East can't continue into June, July, August or Trump will lose not just the House but the Senate as well. If it does continue then we think pricing moves from being up mid-single digits in those peak summer months to being flat-ish in those peak summer months. We don't think it goes negative. But I can't rule it out either if there was some adverse development in the Middle East or the Strait moves. You know you never say never but I would be much more optimistic that I think we are being conservative in the guidance today and that the out-turn will continue to improve and be better partly because people will inevitably go on holidays one way or the other. I just think holiday in Europe, at European resorts, at Portugal, Italy, Spain, Greece at this summer. Many more will fly with us to Turkey, Albania and Morocco because they can avoid Europe's mad ETS taxation by simply flying to neighboring non-EU countries and that way will reflect itself by the time we get to the first or second quarter numbers in slightly more optimistic tone on volume and pricing.

Again you take the second half of that question please. On Boeing, yes they have started building the MAX 10, they expect by the end of this year they'll have about 40, I think it's 30 or 40 MAX 10 built, some of which our first delivery is due in January of 2027 so some of ours will actually be built before the end of this year but it's all down to certification now. Boeing have been making very positive noises on certification. We separately have also been into dialogue with the European Safety Agency who have to certify the aircraft for Europe. They've been very complimentary of the work that has been done. They don't see that there will be any significant delays on the certification but obviously that depends on the FAA and we get a sense also from the FAA that there's a better relationship there under the current administration, more supportive FAA, they want to see American manufacturing succeed and they certainly appear to be more supportive of Boeing and certification but there's always a risk of slip-up. But I think we take heart from the turn that the new team on our last 29 Game Changer deliveries which were delivered to us almost a year late, each one of those aircraft were defect-free and were delivered on average one or two months earlier than the original delayed delivery date. So they're doing a really good job on the shop floor in Seattle also in Wichita taking clean holes and Seattle producing clean aircraft, no defects. We're actually pulling some of our engineers back out of Seattle now because there's no reason for them. So I would be reasonably optimistic that we're going to get those first 15 aircraft in the spring of 2027. That gives us capacity growth to get to about 223 million passengers by FY28 and close to 230 by FY29 and then we start stepping it up growing at about 15 million passengers a year through 30, 31, 32, 33. The 300 million passenger target by 2034 is unchanged and as I said to the previous caller I see no reason to change my somewhat optimistic out-turn that profit per passenger will rise towards 12, 14, 15 per passenger over the next four or five years and I believe the current crisis in the Middle East and the Strait will accelerate that profit growth although it may take it in this year but it will be temporary and short-lived. But Neil, on the CFM engines and maintenance.

Yeah, as you're aware, you know about 85% of the cost of engine maintenance is the spare parts. It's not labor. You look at the 30 spare LEAP deal we announced we did during the last 12 months. You know we bought those aircraft from our partners in CFM, you know, at a deeply discounted price they wanted and we think we'll be able to repeat that kind of success by during periods of distress buying large quantities of spare parts at, you know, a very advantageous discount for both our engine maintenance and for our shareholders.

Yes, the answer to the question is yes. I mean, for example the Austrian government at the moment is considering new budget, they make a budget statement in June. We know already because they've admitted already they're looking at reducing the aviation tax which is currently 12 per passenger. Now, we've been quite aggressive that forget reducing it, you know, either abolish it or don't waste your time. We will not be going back with any growth to Vienna. All of the growth is moving up the road to Slovakia where they are, you know, the new transport ministry is delighted with himself and the record traffic growth that Bratislava airport is enjoying. In fact, last week the new imaginative bus company has now started running five bus services from the center of Vienna direct to Bratislava airport taking advantage of the enormous surge in demand from Viennese citizens and visitors who are now getting there via, you know, the much lower cost of Bratislava airport and we think that trend will continue. We will continue to move aircraft out of countries and airports where taxes, air fees are high where as I said you have these government monopolies, you know, operating 1880 regulated, the regulator looking to double airport fees over the next year, you know, growth will come but the problem is we have an incompetent government who can't even deliver on the 18 months later still haven't delivered on their election promise to abolish the cap at Dublin Airport growth as soon as possible. You know even for the snail pace delivery of an Irish government, 18 months does not consist of as soon as possible, predicting 2020. So we do expect there will be more regional air regions in Italy will reduce taxes and the taxes now are coming down. The big issue here is whether we can persuade the European Commission led by that lady who has spent the last two years talking about the competitiveness of the European economy but doing absolutely nothing about it. Can we finally persuade her as the other Europeans as it's time to abolish ETS taxes which are only applied on European citizens on intra-EU flight while we exempt the Americans, the Gulf, the Asians and everybody else traveling to and from Europe. This makes no sense. This year alone Ryanair will pay 1.4 billion in ETS taxes. It adds about 8 euro to every ticket. The first step is serious about competitiveness and we don't think she is because frankly all she does is talk about it and do nothing. Start by abolishing ETS which would reduce airfares in Europe by between 5 and 10 for every single European citizen. We keep pushing but I wouldn't expect anything coming out of the useless lady.

J. What we do is hedging at the moment obviously we haven't started, if you look forward out into, we're 80% hedged for FY27. The current rate, the current forward rate over the FY27 you could be hedging today at about $120 a barrel. Spot last Friday was about, on Friday was about $136 a barrel. Out into FY28 you could hedge today at about $92 a barrel. So you know there's a very deep contango in the market where the further out you go the further prices fall away. I would be willing to, I certainly we could remain unhedged into the summer of 2027 up until about September, October of this year. And I, you know, you speak to any expert nobody really believes that the war in Iran or the Strait of Hormuz will remain closed out of September, October this year but that doesn't rule out the possibility, there must be always some possibility. I think the key pressure point as we move through this summer will be the US midterm election and whether Trump can keep the House and the Senate. And so I think there will be a change of tone and strategy when it comes to the Middle East and particular gas prices in North America. But I would not expect us to start hedging into summer 27 if prices remain elevated like this until about September, October and then I think we would still be in a position to do it at, you know, you'd be looking at going up from $67 a barrel now to maybe a price mid-90s but if that happens there will be a number of very large airline failures in Europe this autumn. So you know what we would lose on the fuel hedging going forward into 27 we would more than gain on, you know, the likes of some of these airlines in Europe who are unprofitable and are poorly hedged, they will simply fail and you look obviously Spirit is the most recent example of that here in North America in recent days. Why is 4 billion the right number? 4 billion was the number we went into, you know, where we went into COVID with 4 billion gross cash and 4 billion of gross debt, zero net debt position. You know we do operate in a cyclical business. This is a really phenomenal business. It is very profitable. It turns out huge amounts of cash and we have used that cash to repay 4 billion in bonds over the last five years. But it's also an industry that's very susceptible to external economic shocks like the Gulf War, Russia's invasion of Ukraine and now you have the, you know, the war in the Middle East and the Strait of Hormuz moves. So I think we're a brilliant airline, very profitable, very cash productive airline but we're also an airline that is the subject of external shocks that we can do nothing about and we believe that 4 billion is the right kind of number that we should be aiming for. That doesn't mean if an opportunity came along we would let that cash drop down to maybe 2 and a half billion, we would if the right opportunity came along and also that we wouldn't let it rise from 4 to 4 and a half or 5 billion. Now 5 billion we don't need it, too much. So everything over 4 billion and we will build ourselves back up to in the next 12 months, everything over and above that we would be deploying in dividend and shareholder buybacks.

You should update where we are on the dollars needed on the particular orders. Again jumping on days where the dollar weakens, we've now got 60% of the 150 firm orders hedged at over 1.23 on the euro-dollar. So we're locking in significant savings there. This is a keenly priced aircraft deal and in euro terms we're now locking in cheaper seats which is good for the capex but also cheaper seats which is good over a longer period of time for the P&L. So pretty pleased at that and the treasury team remain ready and able to jump on every weakness that we see in the dollar to expand that further.

The first question just if I understood the question and it is would the higher price whether we would take the A320s or look for neos, is that the question? No just if still profitable to fly the A320s in the current high fuel environments, the A320s that we have. The answer to the question is yes if the lease rates are falling. And the great joy of the Middle East strike, the Middle East is this again an opportunity. We're extending these leases which are coming to end of life, you know, materially reduced monthly lease rate and the monthly lease rates were already significantly below market. You know a lot of the lessors of these aircraft, they're coming to the end of life, they have Ryanair on their kind of as a customer and the risk of taking back these aircraft that are getting to the end of life and trying to market them somewhere else in the world or take a, you know, a hit on the lease rentals and on the redelivery conditions and extend the deal with the Ryanair group for another year or two seems to be attractive. So the answer to the question is not the most fuel efficient aircraft but if the lease rates are falling we would always be happy to take advantage of those kind of opportunities and remember, you know, they really only account for 26 aircraft out of 675 odd aircraft, 650 aircraft leased where most of that now is the Game Changers which are offering us 4% more seats and burning 6% less fuel. So in actual fact our fuel consumption on a per seat basis will continue to modestly decline with the benefit of the Game Changers will begin to significantly decline as we move into the MAX 10 in 27, 28, 29.

Thanks. Sorry the first idea to give again more color maybe Darrell on the salary negotiations. Just explain that the first part of the hedging so if we talk about if we hedge into FY28 at higher prices how do we think we would pay for that? Is that the... Yeah. Sorry if you don't start hedging in the coming months for FY28, even using the forward for example, how do you plan to pass on the fuel cost inflation? Is it through pricing? Is it something else that we should be aware of? Thank you. Again I come back to the if the oil prices remain higher for longer through for example say the third, our fiscal calendar, the December quarter or the December quarter, if oil price remain higher into that quarter then I think you would see us start to put down some hedging into the summer of 2027 so FY28 at maybe, take a number, 90, 95 per barrel, higher than this year's oil price. But there will at that point in time be casualties here in Europe among the European airlines. You know there are people who are less, I mean we're 80% out to March 2027, most of Europe's second tier airlines are hedged kind of generally out to about October and some of them while they claim to be hedged aren't hedged at all. They have caps and collars. So and but what would happen? I think if there were higher oil prices out into 2020, into summer of 2028, it is inevitable that the legacy airlines would be bringing in fuel surcharges. I think it's inevitable that there would be far less capacity available in the system next summer partly because of failures and partly because capacity simply would be grounded. And I would think be, you know, a significant upward pressure on pricing but you know I don't expect that to be the outcome. I expect by the time we get to the end of May or June there will be, you know, Trump will be declaring victory in the Middle East, the Strait of Hormuz will be reopened, the focus will be over here on the midterm elections in November and that there will be a much more optimistic environment, political environment here and economic environment in relation to oil prices. And maybe Darrell you want to take the salary negotiation question.

And remember what we're doing here, you know, we're putting in place new pay deals which will run a dramatic uptick in productivity, productivity coming from the delivery of MAX 10 aircraft which starts in the spring of 27 runs out over the next 5 years out to 2030. After the 5 years of these when, you know, our basically captains and crew will be flying 20% more passengers on a per seat basis and burning 20% less oil. So it does make sense from an operating and from an efficiency point of view to share the upside of that with our people by putting in place new five-year pay deals. Now where is an element of front-ending the incentive for the staff is you get the pay increase front-ended but we get the productivity gain over the lifetime of that five-year deal.

I mean very difficult. It really, the duration of these airport, of the airport deals it very much depends on airport by airport basis. Some of them now run out into 2035, 2036, particularly for example like London Stansted where they're investing a billion pounds extending the terminal facility and growing the capacity from 30 to about 45 million passengers per annum. And you know I would highlight that as and they want the security with growth commitment will fill those facilities if they put in those extensions. They're going to grow capacity from 30 to 45 million passengers, about, you know, 50% growth in capacity for a cost of 1 billion. Meanwhile Dublin proposed to spend 5.6 billion with no increase in capacity. I mean, you know, 1.5 billion of inflation, 600 million on, you know, vanity sustainability projects including 7 million planting bloody wildflowers, you know, which could only come about with a kind of government owned monopoly pissing away money. So the length is typically when we're doing extensions or somebody wants growth typically is four to five years but in some cases where they're committing extensive traffic on facility enhancements, like in Bergamo for example they run out longer typically out to 2035, 2034, 2035, 2036 so it varies. I would say though almost every airport in which we operate where we have a four or five year deal they're back to us within two years going can we have another more growth can you extend again and we are, I mean this is no exaggeration, Jason Minneson is saying they can barely get in the office door at the moment with the numbers of airports that are sleeping in our reception looking for meetings, looking for growth partly because they are very worried that some of their existing carriers who are heavily indebted or less well hedged or don't have the balance sheet will not survive or will dramatically cut back on their capacity growth. For example, you know, Bratislava, you know, would give it, you know, where we're growing very rapidly now, one of our competitor airlines agreed to grow at their base from two to five aircraft apparently then a week later they changed their minds, told Bratislava the fifth aircraft isn't coming. Called us the same morning and said there's another spare stand here. Do you want to put another aircraft in here and we give you terms? So don't tell anybody when I'm coming down to Bratislava next week to announce another aircraft that we'll buy one more aircraft this year solely because one of our best competitors didn't honor their kind of five aircraft base deal. And on my contract, you know, sorry why 2032? Jesus this is 2026, 2032 looked like a reasonable extension. I was offering 2030, the board was 2033, we settled on 2032. They put and, you know, I don't, we're not going to breach the confidential energy that the board wants to discuss with some of the larger institutional shareholders but there are very aggressive and I mean very aggressive profit and share price targets on the share option purchase agreement and other than that I get paid a very modest basic salary and bonus, no pension and no anything else. But, you know, it has always been my philosophy. You know, I want my remuneration rewards tied to very ambitious profit and share price kind of targets. The last time around in 2019 I had to almost double the profit or almost double the share price and I think shareholders, you know, would reasonably assume that the next set of targets are not similar to that but again the board wants to brief the main shareholders on that first.

Fantastic. Ok. Folks, thank you very much. Again may I conclude by just reminding everybody we've had a record year, record traffic, record profit. You know we have been overtaken by events in the Middle East in the last two months. But I do not expect that that will last very long. Maybe another month or two and then I believe, you know, the Strait of Hormuz will reopen, oil prices will settle down, people will go back to booking with confidence during the peak summer months and Ryanair is incredibly well positioned with 4% more seats this summer, while controlling remarkable unit cost discipline in a marketplace where none of our competitors, the gap between us and our competitors is widening. We are really well hedged out of March 2027 that gives incredible financial strength. We will pay down the last of our bond debt next week and we will be essentially debt free and that puts us in an enormously strong position to continue then to grow capacity next couple of years, take delivery of MAX 10 aircraft that will transform our operating economics because they are 20% more seats, burn 20% less and you guys today can buy all this incredible advantage at I don't know 22, 23 a share. And so I don't want to hear anybody telling me for the next two or three years, oh I wish we bought the last time there was a dip. Here's the dip. We're buying, we're very happy with our share buyback program. The average cost has dramatically come down over the last two or three months and for that we're extremely grateful. And we look forward, we have an extensive road show with all of the senior managers on the road across the UK, Europe, east coast and west coast America. I myself I'm in New York for the next two days. Chicago on Wednesday, Boston on Thursday. If anybody wants a meeting, if anybody wants, you know, to be reminded of how strong Ryanair's fundamentals are and how profitable and cash generative we are, please ask the city, good buddies Davis for a meeting. We look forward to meeting you. Other than that, if anybody wants to come to Dublin over the summer and visit us or see the operation, you're very more than welcome. I believe we're setting off on another five-year period of very strong traffic growth on aircraft that have more seats that burn less fuel and they will in turn deliver strong profit and very strong share price appreciation. So with that thank you very much for joining the call. Tomorrow look forward to seeing you on the next couple days and if not during the summer. Thanks everybody. Bye bye.