Results due from Ryanair and Aer Lingus
Ryanair and Aer Lingus will both report financial results this week. This time last year, Ryanair reported Q1 results which were below expectations, with profits falling 29 per cent to €99 million following a 27 per cent increase in fuel costs.
Fuel costs, which represent 45 per cent of overall costs, have increased further since then, and the airline has already guided a lower Q1 than last year.
Davy Stockbrokers estimates a net income of €73.8 million for the airline, below consensus, on revenues of €1.3 billion.
The stockbroking firm said it expects a “powerful peak summer performance” with full-year guidance unlikely to change given zero winter visibility.
It has continued to rate Ryanair as “outperform” with an €8 price target.
Aer Lingus will report half-year results this Wednesday, having posted Q1 revenues in April which were 3.3 per cent ahead of the prior year.
In April, it reported an operating loss, before exceptional items, of €45.5 million, €9.4 million higher than prior year largely due to Virgin wet-lease start-up costs, planned changes to the long-haul fleet and slightly weaker trading on UK routes.
Goodbody expects the results to be down year-on-year due to the one-off start-up costs associated with Little Red and the reintegration of the seventh A330 into the fleet.
Aer Lingus saw passenger numbers increase 1.3 per cent in first six months of this year, despite capacity growth of less than 0.5 per cent. Long haul again stood out, growing by 12.7 per cent.
“We estimate long haul fare growth of 4.9 per cent and 0.9 per cent on short haul, giving passenger revenue growth of 5.8 per cent to €543 million,” Goodbody research analyst Donal O’Neill said.
The airline is currently fighting Government attempts to hit it with an estimated €4 million bill over the now-defunct two-tiered travel tax system introduced by the late Brian Lenihan when he was minister for finance. In April, the State filed lawsuits against Ryanair, Aer Lingus and Aer Arann. This is listed for mention today.