Ryanair first half profit fall 47% to €215m

Ryanair this morning released the eagerly awaited results of the first half year to the end of September.

During the period, fuel costs more than doubled at the airline to €788.5m as traffic grew 19% to 32m. The average fare fell by 4% to €47 with revenue growing 16% to €1.8bn. Load factor fell one point to 85%.

Speaking at the press conference to announce the results, Ryanair CEO Michael O'Leary said that the airline was 25% hedged on fuel costs at $77 per barrel for the first half of next year which would represent a 40% saving over 2007. 

Commenting on the woes of the airline industry in general, O'Leary said that "recession was a bigger issue than oil price" for the airline at the moment and that '"the deeper and longer the recession lasts, the better for Ryanair". A deepening recession would make Ryanair a stronger player in the European airline scene with a forecast 90m passengers generating €800m in profit by 2012. O'Leary also forecast that fares would continue to fall by between 15% and 20% in the second half of the year, leading to loss making in Q3 and Q4 but breaking even for the year.

As has come to be expected of the Ryanair chief, plain talking was the order of the day - speaking of the "lunatic tourist tax as we enter a recession" he predicted that traffic through Dublin airport will fall for the first time in 20 years as a consequence. The new Terminal Two in Dublin will be "available for rent as a sex shop when it opens for business in 2010" as he predicted there wouldn't be any passengers using it. The airline also predicted today that Shannon will be particularly hard hit by the tax and they foresee a 75% reduction in (RYR) services through the airport from November 2009 if the tax is implemented as announced.

In relation to aircraft acquisition plans,Ryanair fleet numbers are shown as 163 (2008), 195 (2009), 238 (2010), 264 (2011), 279 (2012). Howard Millar, Deputy CEO when asked about aircraft disposals,  explained that the current plan is to dispose of 46 aircraft. Of these 25 have already been sold and 6 delivered. The remaining 19 will be taken out of service over the winter period. Eleven aircraft are on operating leases and will be returned, which brings the total to 36, leaving 10 aircraft to be disposed of in 2010. 

Ryanair's plans to launch a trans Atlantic service had been much hyped in the print media in the days leading up to today's press conference. When asked about the airline's ambitions, Michael O'Leary responded "..on long haul, don't believe everything you read in the News of  The World..". He went on to explain that there is a plan but it needs a collapse in the price of long haul aircraft before anything happens. He didn't foresee anything of significance in aircraft pricing happening in the next 6 to 12 months which would put a launch at 18 to 24 months, minimum.  

With the Boeing Machinists strike over, Ryanair can look forward to a resumption of deliveries. Pictured is the last but one 737 to be delivered before the workers struck, EI-DYO, msn 33636.