ROME/ABU DHABI/LONDON (Reuters) – Ryanair has seen better booking momentum since last month and has less need to cut prices, the airline’s chief executive Michael O’Leary told Reuters on Tuesday, adding that full-year profit would likely be slightly lower than last year but would remain “very strong”.
His comments reassured investors after a difficult few months for the airline industry. Ryanair shares soared on the stock market, also giving a boost to European rivals including easyJet, British Airways owner IAG, Air France-KLM and Lufthansa.
In July, Ryanair’s stock market collapsed after the announcement of a 15% drop in ticket prices for the period from April to the end of June, which reinforced fears of a gloomy summer for European airlines.
Prices are likely to fall by 5% to 9% in the three months to the end of September compared with the same period last year, Michael O’Leary said, with signs of improvement in recent weeks.
“We had to do significant discounting to achieve our load factor targets. I think that from August onwards, there is better booking dynamics, we have to do less discounting,” said Michael O’Leary, adding that less significant discounting is expected until November.
He said the Irish carrier was making “very strong profits” but admitted they “may be slightly lower this year than last year”.
Other carriers have also seen a slight impact on prices as demand stabilises but have not been hit as dramatically as Ryanair.
(Reporting by Angelo Amante and Conor Humphries, by Leo Marchandon, edited by Blandine Hénault)
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