Ryanair offers to take over Alitalia’s short-haul business
Irish airline’s profits grew by 6 per cent last year to €1.3 billion
Ryanair flew 120 million passengers in the course of its financial year, up 13 per cent on the previous year. Photograph: Reuters
The Irish airline said on Tuesday that it grew profits after tax by 6 per cent to €1.316 billion in the 12 months to March 31st and announced plans to return €600 million to investors through a share buy-back scheme.
According to chief commerical officer, David O’Brien, Ryanair is planning to propose a tranfser deal to the government-appointed commissioners s charged with saving Alitalia.
Under its terms, Ryanair would take over much of Alitalia’s short-haul business and feed passengers to its long-distance network. “We’d even sell their long-haul flights on our website,” Mr O’Brien added.
While analysts were not sure that the Italians would accept the deal they suggested that government efforts to save the flag carrier could deliver an outcome that would suit Ryanair.
“They cannot keep it on life support but keeping it as a long-haul focused airline, which Ryanair would like, is an option,” one said.
Ryanair has a bigger share of the Italian market than its troubled rival. Its operations there flew 36 million passengers in the 12 months ended on March 31st.
Chief executive Michael O’Leary confirmed that Ryanair was in talks with Boeing to add “selectively” to the orders it has with the American aircraft manufacturer.
The airline took delivery of 52 Boeing 737s in its 2017 financial year.
Ryanair flew 120 million passengers during the financial year, an increase of 13 per cent on 2016. It grew revenues by 2 per cent to €6.54 billion.
It plans to buy back €600 million worth of equities from investors between this week and October, bringing total returns to shareholders since 2008 to €5.4 billion.
Mr O’Leary said Ryanair believed that profits this year could rise 8 per cent to between €1.4 billion and €1.45 billion, subject to a range of uncertainties.
“Investors should be wary of the risk of negative Brexit developments, or any repeat of last year’s security events at European cities, which could damage consumer confidence, close-in bookings, and this full-year-18 guidance,” he cautioned.