Ryanair(RYAAY)2025-01-27 18:15Financial Data and Key Metrics Changes - The company reported a Q3 profit after tax of EUR149 million, with a traffic growth of 9% to 45 million passengers, although profits for the nine months were 12% lower than the previous year at EUR1.94 billion compared to EUR2.19 billion, attributed to an 8% decrease in airfares [4][6][16] - Revenue per passenger increased by 1%, with average fares and ancillary revenue also up by 1% [5][6] - Ancillary revenues rose by 10% to EUR1.04 billion in Q3, while operating costs increased by 8% to EUR2.93 billion due to traffic growth [6][16] Business Line Data and Key Metrics Changes - The company experienced a 9% traffic growth despite Boeing aircraft delivery delays, with ancillary revenues showing a significant increase [5][6] - The integration of approved OTA partnerships is progressing well, contributing positively to revenue streams [5] Market Data and Key Metrics Changes - The company has revised its FY 2026 traffic target down to 206 million passengers, reflecting a 3% growth, due to ongoing Boeing delivery delays [9][16] - The company anticipates that European short-haul capacity will remain constrained in summer 2025, benefiting forward bookings and pricing [10][16] Company Strategy and Development Direction - The company plans to reallocate scarce capacity growth to regions and airports that are incentivizing traffic growth, particularly in Poland, Spain, Sweden, and regional Italy [10] - The company is actively reviewing ownership and control restrictions in light of EU shareholding trends, expecting to reach the 50% threshold in early 2025 [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding future traffic growth, despite the current constraints and external risks such as Boeing delivery delays and geopolitical conflicts [16] - The company is guiding a full-year 2025 profit after tax in the range of EUR1.55 billion to EUR1.61 billion, contingent on avoiding adverse developments [16] Other Important Information - The company has completed over 60% of its EUR800 million share buyback program and expects to finish it by mid-2025 [5][7] - The company is well-hedged for fuel costs, with over 75% hedged at approximately $77 per barrel [18] Q&A Session Questions and Answers Question: Can you discuss the type of growth for summer and the supply chain issues? - Management noted that while they expect reasonable growth in Q1, visibility into Q2 is limited, and they are frustrated by Boeing's delivery delays impacting growth targets [25][29] Question: What is the update on OTA partnerships and their impact on bookings? - Management confirmed that agreements with over 90% of major OTAs are in place, leading to strong forward bookings at higher average fares [47][48] Question: What are the implications of slower growth on unit costs? - Management indicated that slower growth should not constrain costs significantly, as they have adjusted crew levels in anticipation of aircraft deliveries [62][64] Question: How does the company view capacity constraints in Europe? - Management believes that while there may be some modest capacity growth, it is not occurring in markets where the company is expanding, allowing them to capture market share [72][74] Question: What are the expectations for CapEx given revised delivery outlooks? - Management expects CapEx for FY 2025 to be around EUR1.7 billion to EUR1.8 billion, with adjustments based on aircraft delivery timelines [129][131]