Ryanair Holdings Plc · EURONEXT:RYA
Ryanair — Q1 FY21 Earnings Presentation
19 slides from Ryanair's earnings presentation, Jul 27, 2020
Slide 1: FY21: Q1 Results
~ RYANAIR MORE CHOICE. LOWER FARES. GREAT CARE. FY21: Q1 Results
Slide 2: Europe's Lowest Cost Airline Group
Eur ope’s Lowest Cost Air line Gr oup Lowest fare/lowest cost airline group No. 1, Traffic – 149m guests (FY20) No. 1, Cover – 242 apts/2,100 routes Successful return to service 1 Jul Strong (BBB) balance sheet Financial strength + Lowest cost = Long term winner 2 2
Slide 3: Europe's No. 1 Coverage
E u r o p e ’s N o. 1 C ove r a g e 79 bases 242 airports (60% prim) Over 2,100 routes RTS 90% network only 60m guests (FY21) 3 3
Slide 4: Europe's Lowest Fares
Eur ope’s Lowest Far es Avg. Fare Change % > Ryanair Ryanair €37 +2% Wizz €43 -3% +16% easyJet €59 -3% +59% Norwegian €99 +9% +168% Lufthansa €178 +1% +381% IAG €190 - +414% AF/KLM €213 +1% +476% Avg Competitor Fare €131 +254% (Source: FY results/Annual Reports) 4 4
Slide 5: Europe's Lowest Costs Wins!
Eur ope’s Lowest Costs W ins! € per pax RYA WIZ EZJ NOR E’Wings LUV Staff/efficiency 7 6 10 19 20 55 Airport & Hand. 8 11 22 19 18 9 Route Charges 5 5 5 7 7 0 Own’ship & maint. 7 14 9 28 21 17 S & M other 4 3 7 14 28 20 Total 31 39 53 87 94 101 %> Ryanair +26% +71% +181% +203% +226% 5 5
Slide 6: Q1 FY21 Highlights
Q1 FY21 Highlights Jun 19 Jun 20 Guests (m) 41.9 0.5 -99% Load Factor 96% 61% -35pts Revenue (m) €2,312 €125 -95% Costs (m) €2,037 €313 -85% PAT / (Net Loss) (m) €243 €(185) N/A OTP 91% 98% +7pts 6 6
Slide 7: Strong Balance Sheet (BBB)
Strong Balance Sheet (BBB) €’bn 31 Mar 20 30 Jun 20 Assets 10.94 10.65 Incl. 333 unencumb. B737s (€7bn book val) Cash 3.81 3.94 Total 14.75 14.59 Accruals 5.62 5.12 Breakeven cashflow post RTS Debt 4.21 4.81 S/H Funds 4.92 4.66 Total 14.75 14.59 7 7
Slide 8: Current Developments
Cur r ent Developments RTS July – 40% cap. (90% network); Aug c. 60%; Sept c. 70% Illegal State Aid = below-cost selling Europe’s cost leader – Right-sizing the cost base MAX deliveries W. 20 (subject to Q3 RTS in USA) Post Covid-19 growth opportunities Brexit risk intensifies Outlook
Slide 9: Return to Service - July
Retur n to Ser vice - Jul y Successful RTS on 1 Jul: 40% schedule, 90% routes, 70%+ LF Comprehensive health measures EU Govts ease lockdowns OTP excellent: 95%+ Controlled capacity & LF incr. into H2 Traffic heavily dep. on no material 2nd wave of Covid-19 Seat sales to stimulate deman
Slide 10: Illegal State aid to legacy carriers
Ille gal State aid to le gacy car rier s • Flood of illegal state aid to flag carriers AFKLM/Alitalia/Luft/SAS/TAP • Illegal State Aid will lead to below-cost selling by flags State Aid (€bn) Lufthansa Group 11.0 Air France-KLM 10.6 Alitalia 3.5 TUI Group 1.8 TAP 1.2 > €30bn Finnair 0.9 Condor 0.6 S
Slide 11: EU's Cost Leader – Right size the cost base
EU’s Cost Leader – Right size the cost base UK & Ire pay deals – pay cuts to avoid job losses Headcount reductions where nesc. - Germany New airport growth deals Improved supplier terms – maint, mkting Lauda rescue plan: - Cut fleet to 30 A320s (was 38), closed STR base - Negotiated lower
Slide 12: Boeing 737MAX update
Boeing 737MAX update 210 orders (135 firm, 75 options) MAX-8 RTS in Q3 in USA 1ST MAX-200 deliv. before end 2020 Target 40 MAX-200s delivs. for S.21 – Subj to Q3 RTS “Gamechanger”: 4% more seats, 16% less fuel Envir. savings: -16% emissions, -40% noise Lower cost MAX drives EU mkt shar
Slide 13: Post C-19 Growth Opportunities
Post C-19 Growth Opp Failures incl. Flybe, Gerwings, Level, Sun Express, & others Competitors retrench - AFKLM: 2021 capacity -20% - Alitalia: “focus strongly on LH routes” - EZJ: 51 acft by Sep ‘21 (no growth until ‘25) - IAG: 57 SH delivs 2020-2022 - LUF: 300 acft parked - NAS: cancelled B
Slide 14: No-deal Brexit risk intensifies
No-deal Br exit risk intensifies UK left EU Jan 2020; transition to Dec 2020 Hope UK/EU agree deal for air travel by Oct As EU Group, RYR less effected than UK comp. Restrict non-EU voting rights if “hard-Brexit” RYR UK AOC protects UK dom. & 3rd country routes BOE Governor: “No-deal Bre
Slide 15: FY21 Outlook
FY21 Outlook No FY21 guidance: Covid-19 uncertainty continues 60m FY21 traffic (60% from 149m), Q2 loss < Q1 Right-sizing cost base (airports, people & aircraft costs) Lower fares to drive vols into H2 – danger of 2nd wave Covid-19 State Aid will cut yields – below cost selling by flags
Slide 16: Appendices
Appendices Appendices 16 16
Slide 17: Fuel hedging & ineffectiveness
Fuel hedging & inef fectiveness 90% expected FY21 fuel vol hedged pre Covid-19 crisis Fleet grounded – excess fuel hedges for FY21 Some P&L volatility in FY21: ineffective hedges MTM each qtr Possibly more ineffectiveness if slower RTS FY22: 30% jet hedged @ $541 (65% €/$ @ $1.15) 17 17
Slide 18: Environmental Progress: EU Leader
Envir onmental Pr og r ess : EU Leader CO2 50% lower than BA/Luft/AF @ 66g per pax/km Cut CO2 by over 10% to <60g by 2030 CDP Survey participation in 2020 Paid over €630m in envir. taxes in 2019 Plastic free in 5 years (82% now) $20bn invested in MAX fleet, +4% seats, -16% fuel, -40% noi
Slide 19: Disclaimer
Disclaimer Certain of the information included in this presentation is forward looking and is subject to important risks and uncertainties that could cause actual results and developments to differ materially from those expressed in or implied by such forward-looking statements. By their nature, for