Ryanair optimistic despite record €815 million annual loss – will tap bond markets


Low-cost Irish carrier Ryanair has posted a record loss of €815 for the fiscal year 2020-2021 but remains buoyant over the carrier’s future as signs of a recovery in demand are already being seen. Last year it was forced to cancel over 80% of its flights owing to the COVID-19 pandemic, flying only 27.5 million passengers to March compared to €149 million the previous fiscal year. Chief Financial officer Neil Sorahan confirmed that the group intended to tap the eurobond (a bond issued that is denominated in a currency not native to the country where it is issued) market in the near future but gave no indication of the amount it intended to borrow. Last year Ryanair raised €850 million in eurobonds as part of an overall €1.95 billion cash raise.

Chief executive Michael O’Leary commented that Ryanair intends to take advantage of the “favorable” interest rates and financing terms available from current capital markets. Sorahan revealed that the airline had cash of €3.1 billion, while 85% of its fleet, worth €7.5 billion was “unencumbered”, i.e., not being used to secure any debt. The carrier reiterated its previous forecast that passenger numbers for the current fiscal year would be towards the lower end of between 80 million and 120 million passengers, while anticipating that only five million to six million passengers will be flown in the April-June quarter.

Meanwhile, problems persist in relation to the delivery of long-awaited 737 MAX jets from Boeing. Ryanair believes there is a risk that 14 planes due for delivery at the beginning of May will not arrive before the summer. The carrier has 210 of the jets on order and deliveries have been postponed several times. O’Leary has blamed management at the Boeing factory in Seattle, dubbing its response to regulators and customers as “abysmal”. However, he told analysts that he believed the problem was short term, saying: “I do believe it will be resolved and we will have 60 delivered on time for summer 2022.” (€1.00 = US$1.20 at time of publication.)

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