London (AFP) – Irish budget airline Ryanair reported falling net profit for the second quarter on Monday and revised down its passenger growth target following delays in deliveries of Boeing aircraft. Chief executive Michael O’Leary warned that Ryanair’s full-year results “will be subject to avoiding adverse developments,” citing risks from conflicts in Ukraine and the Middle East, staffing issues from air traffic control, and further Boeing delivery delays.
The company posted an after-tax profit of 1.4 billion euros ($1.6 billion) for the second quarter, a six-percent drop from the same period last year. For the first six months of the fiscal year, its net profit was down 18 percent to 1.8 billion euros. Strong growth in passenger traffic in the first half of the year “was offset by lower air fares,” which fell seven percent in the second quarter, the company said. The low-cost airline attributed declining prices partly to “higher-for-longer interest rates” that cut into the disposable income of its customers.
Delays in Boeing deliveries had weighed on Ryanair results and traffic last year. The Dublin-headquartered airline has trimmed its passenger growth target for fiscal year 2026 to 210 million passengers, down from 215 million previously. “While we continue to work with Boeing leadership to accelerate aircraft deliveries… the risk of further delivery delays remains high,” O’Leary said. He cited the “substantial impact” of a five-million-passenger shortfall in its full-year results.
Thousands of employees at US aviation giant Boeing have been on strike for more than seven weeks in a fight focused on higher wages and improved retirement benefits. The US planemaker has also faced technical issues over safety, which have contributed to delays in delivering its aircraft. “Boeing’s woes are showing up in Ryanair’s difficulties,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown. She added that there is a chance passenger growth figures could be revised down further if Boeing fails to deliver on the order.
© 2024 AFP
