Irish airlines on schedule to turn a profit

Fragile recovery dependent on no further fallout from Ukraine war or revival of lockdowns, says Ryanair

As of this week, both Ryanair and Aer Lingus looked poised to earn profits in their respective financial years, hopefully marking the end of Government pandemic curbs on travel.

This week Ryanair reported that it earned a record €1.37 billion profit in the first half of its financial year, which ended on September 30th, so included the summer. That leaves it likely to earn a surplus of between €1 billion and €1.2 billion over the 12 months to March 31st, said chief executive Michael O’Leary.

However, he stressed that this depended on no further fallout from the Ukraine war or no revival of lockdowns, similar to those imposed last Christmas following the arrival of Covid’s omicron variant. Either or both could upend a recovery that Ryanair consistently calls “fragile”.

Ryanair published its figures 10 days after Aer Lingus, announcing results in tandem with parent International Consolidated Airlines’ Group, said it earned €139 million operating profit in the three months ended September 30th. As there are just weeks to go to the carrier’s year-end, December 31st, that leaves less time for anything to go wrong.


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Consequently, Aer Lingus chief executive Lynne Embleton could predict that the company would end this year with a small operating profit. But she stressed that this would be far lower than the comparable surplus for 2019, the year before Covid struck, and which the air travel industry now takes as its benchmark for normal.

But even without pandemic restrictions, 2023 looks very different from 2019. High or volatile oil prices will continue to dog air travel. Ryanair believes this could go either way, so has hedged 50 per cent of its fuel needs for its next financial year, a position the airline argues allows it to adjust to either probability.

Meanwhile, the strong dollar looks like a double-edged sword for Aer Lingus, which is increasing capacity on north American routes. The currency difference will boost Europe’s attractiveness to US tourists but will make transatlantic holidays more expensive for anyone on this side of the pond. The airline will have to watch carefully how this plays out.