Ryanair Holdings (Euronext:RYA) Q2 2027 Earnings Call

0:00 Welcome everyone to the Ryanair Holdings plc H1 FY27 earnings release. My name is Seb and I'll be coordinating the call today. If you'd like to ask a question, you may do so by pressing star followed by one on your telephone keypad. I will now hand you over to Michael O'Leary, Group CEO of Ryanair Holdings to begin. Michael, please go ahead when you're ready.

0:21 Okay, thank you. Ladies and gentlemen, good morning. Welcome to the Ryanair H1 analyst call. as you see this morning we've released half year results so profits have fallen 15% to 2.15 billion for the half year primarily due to the cost of unhedged oil which has doubled over our hedge price of $67 per barrel however we've delivered another strong operating performance traffic in the half year is up 6% mainly by virtue of the fact that fares have fallen 4% during the peak summer period H1 fares fell although some of that was also April didn't have a full Easter in it but mainly we think we attribute that to the Middle East conflict which in the early parts of summer led to consumer hesitancy later bookings and we did need to price down to stimulate travel and volumes operating costs in the half year risen 10% to 7.7 billion the price of our 20% unhedged jet fuel doubled and supplier compensation fees following the delivery of the final Game Changers last year.

1:26 FY27 jet fuel prices remain 80% heads at $67 a bar, so that has insulated both our earnings and our passengers from the alarming spike upwards in oil price. It's also significantly widened the cost advantage over other EU competitors, as well as boosting current year earnings. While oil prices remain volatile, We've taken advantage of recent dips to extend our FY28 cover, which has now risen from 15% to 25% at an average price of $95 per barrel, but that will still be a 50% increase in this year's hedge. The balance sheet remains strong industry leading. We've paid down our bond debt. The balance sheet is supported by an unencumbered fleet of 620 Boeing 737 aircraft and strong liquidity.

2:17 Gross cash at the half-year end was $2.6 billion, even after paying down $1.3 billion in debt, $800 million of capex, and $400 million of shareholder distributions. In September, you'll have seen we completed our latest $750 million buyback. We've now retired over 40% of Brianair's issued share capital since 2008. The board remains committed, however, to shareholder returns. and so in addition to an interim dividend of 27.3 cents per share, tabled in late February 2027, the board has decided to launch another 800 million share buyback. That is time to start next February, which is when our cash flows are strong, cash flows are strongly positive from January onwards and we expect this latest buyback will run for about a 10 month period, so from February to the end of December 2027.

3:11 We see the current share price as a buying opportunity and by extending the share buybacks we think it will be accretive for shareholders over the medium to long term when the current oil destruction settles down. On fleet, we warmly welcome the FAA's recent certification of the MAX A10. We expect and hope that EASTA will certify this before the end of December which will enable Reiner to take delivery of the first of our 16 MAX 10s in Spring 2027. The first aircraft is due to deliver at the end of January, with another 15 being delivered by the end of April. That will give us 16 new aircraft, our capacity for about 3% traffic growth in FY28, with the traffic rise from 240 million passengers this year to 220 million passengers next year.

3:59 However, in the short term this winter, we have reduced the exposure to unhedged oil by cutting our current traffic target from 260 to 240 million passengers. It means that our winter traffic from November to March will be broadly flat year on year. Next year with the 16 new MAX 10s we'll be able to grow to just over 220 million passengers but that is only 3% traffic growth which for us is very slow capacity growth historically. We think that gives us an opportunity to pipe up meaningfully into the summer of next year. With that spare capacity we're allocating that capacity and churning some of our existing capacity to those states, regions and airports who are cutting aviation taxes and lowering fees and we highlight Albania, Italy, Morocco, Slovakia and Sweden who have abolished aviation taxes.

4:47 The switches will move away from those countries like Austria, Belgium, Germany and regional Spain who are either maintaining high airport fees or raising taxes. Next summer, summer 27, the schedule is already on sale with 126 new routes and one new base in Rimini. The outlook for F-127 traffic, as I said, we expect to grow now slightly less, 3% to 214 million passengers, although our cost leadership continues to widen with all other EU airlines. With 80% of jet fuel hedged at $67 a bar now to March, this year's earnings and our winter traffic are well insulated from the current oil price volatility. However, the final FY28 unit costs will depend on the final price of the unhedged jet fuel for the second half of the year.

5:37 Interestingly, particularly if you look at this morning's numbers, where traffic is up 6% for the half year, but summer fares were down 4%. Pricing has turned round in recent weeks. Since about the start of August, we've seen prices move upwards year on year. Q3 demand, which runs out to December, is strong. And fares have been trending modestly ahead of the same quarter last year, which is a pretty shocking change in pricing from the peak summer period. And I think that augurs well for price increases into the summer of 2027. All the airlines around Europe are not well ahead of December 27. They're all cutting capacity into the winter, and I think that would be a good platform for constrained capacity and higher prices into December 2027.

6:22 The booking window however remains closing and while with reasonable visibility into Q3, we have almost zero Q4 visibility and therefore too early to provide meaningful FY28 profit guidance. I think it's appropriate though we should address the fuel cost for FY28. Based on what we see now, unless there's a swift resolution to the Middle East contract, we expect jet fuel prices will remain elevated well into 2027. As our low cost oil hedges roll off in March of next year, All EU airlines face significantly higher fuel bills. We believe European short-haul airfares will increase materially. We expect to see fuel surcharges from the legacy airlines on their short-haul operations next summer, which will drive up airfares on short-haul services across Europe next year.

7:13 With a 2 billion increase in our fuel bill next year, we need about a 20% increase in airfares, or about 10 euros per passenger, to fund all of that. And while I do think there will be significant boost in airfares next year, I'm not sure we'll see 20%. Therefore, we do need to close a gap. We're going to have to address costs. We're reviewing costs all across our group airlines. Particular focus on persuading governments to abolish aviation taxes. We're accelerating the airport turn negotiations, particularly with the arrival of the fuel efficient MAX 10 next year. where there's maturing labour agreements in April next year we're looking at temporary pay freezes unless those pay deals are done before the end of March next year I'm not sure we'd be minded to agree any pay increases from April next year apart from those that are already in place we will see lower crewing ratios but that is a function of having less aircraft deliveries for the next two years we need to recruit and train fewer pilots we're seeing almost zero churn in pilots or cabin crew at the moment and therefore We're stepping back pilot recruitment and training courses.

8:23 We're postponing those this winter and I think into the summer of 2027. With no attrition, nobody leaving, there's not much reason for us to recruit more pilots, particularly where we're only taking 16 aircraft next year. Those lower crewing ratios, increased use of AI, which is driving further operational back office and support function, will enable us to continue to deliver an exceptional performance on unit cost X fuel next year and that allied to I think what would be a large bump in airfares I'm not sure we'll be able to repeat I think the current guidance and the market expects us to deliver profits of about 1.7, 1.8 billion this year I think there's a reasonable chance we'll maintain that into FY28 but it's all heavily dependent on where fares go and where oil prices go and until we see some certainty of that coming out of the US midterms this week we'd like to see an early resolution of the situation in the Middle East that would at least allow crude oil shipping to restart we'd maybe see crude oil trend back from Brent crude today at $117 a barrel I think that's likely to drift downwards towards $80 a barrel into next year the price spread however will remain elevated and therefore which is currently close to $170 a barrel.

9:48 I think at best that's going to trend down towards $120, $130 a barrel next year. I welcome that as a crisis point. I think it will put a lot more capacity discipline on airlines in Europe. There will be more failures in Europe. Already Valtteri and Air Baltic are in Chapter 11. I think you'll see more European airlines or flaky European airlines who are currently not profitable but who have heavy debts will struggle to survive the winter, and the possibility of consolidation in Europe will accelerate if oil prices remain higher for longer. We have been here before, we've been here before, we've gone through 9-11, Gulf War I, Gulf War II, Putin's invasion of Ukraine, there's been a big bump up in oil prices, pressure on airline pricing for 6-12 months, and then Ryanair emerges out of that period with greater market share Thank you very much.

11:11 Neil, do you want to take us through the MD&A and then I will ask Eddie to give us a couple of words on current trading and Tracey McCann on costs.

11:22 Okay, thanks Michael. I don't have a huge amount to add other than to focus again on the costs and the balance sheet. Costs, despite the fact that the unhedged oil was up at $130 a barrel, performed quite well, rising to 5%. I think that's a sign of the kind of airport deals and the cost discipline within the organisation. Now I would caution that ex-fuel costs will be a little bit higher into the second half of the year due to one, we're now spreading the costs over 214 million passengers instead of the 216 million passengers previously targeted at the start of the year. We'll also see more of those CLA deals going through which will have an impact on the cost into the second half of the year and then the timing of maintenance.

12:15 But I think the advantages that we have, particularly with the MAX 10 coming down the line, these aircraft, 20% more fuel efficiency, 20% more seats, which means we'll be spreading more costs over more passengers and getting more economies and efficiencies. We'll equally get the benefit of warranties. that will drive significant savings and widen the gap between ourselves and everybody else and then further out we've got the engine shops coming online which will again give us a material advantage over everybody else the balance sheet, fortress balance sheet at times like this it comes into its own effectively debt free, 620 fully unencumbered Boeing 737s and a triple D plus credit rating which gives us huge flexibility and the confidence to be able to do that buy back Michael O'Leary, Michael O'Leary, Michael O'Leary, we see the market capacity has come down it's going to grow by at the moment by just over two and a half percent but it's come back by two percent in the market itself i think more is going to come out of that and our competitors pricing up and that's reflecting in uh those stronger affairs and uh but when the curve has moved

13:49 in terms of um uh more close in booking we still have to wait to see how things go particularly for the peak uh christmas period but As you said there, it's strong and it is a change that, as I say, is a function of capacity constraint and competitors pricing up. On the airport turn, you can see where we've opened new bases. We've grown strongly in Poland, grown strongly in Italy. We've got the auto in Albania, Slovakia, a new base in Rabat. And then on the opposite side of that, the Berlin base is closed, the Tefloniki base closed. Thank you very much. and the worry is that we're not going to be able to fill the capacity in our airports and we continue to lock away longer term deals out to you know seven eight in some cases ten years out you know exactly what our cost base is going to be a significant proportion as we grow and so it's the biggest variable cost in the business a lot of good work done on the airport so it is surprised the way the repairs have been have turned, but again,

15:21 a function of capacity constraint and competitors pricing up.

15:26 Okay, and Craig, do you want to highlight on the top plate?

15:29 Just to reiterate, for the winter, we do have to consider the 214 million passengers, and we are going into heavy maintenance season. And then just for next year, somewhat off this, that 2 billion students, we will have to look, as Michael said, at airport churn, retiring labour briefings, we may have to consider temporary pay increases, and look at burn ratios. AI will help us back up before and then at the max 10 delivered we will see the benefit for 20 more seats and how additional fuel costs. The engine shops will come online which will help somewhat widen the cost between us and our competitors on engine and maintenance costs.

16:06 Okay, thanks Tracey. Okay, so let's open it up for Q&A please. So we're limited to two questions each. Thank you. As a reminder, for any questions, please press star followed by one. If you'd like to withdraw from the queue, please press star followed by two. First question is from Jamie Rowbottom from Deutsche Bank. Please go ahead. Jamie, hi. Morning gentlemen, hi Michael. So two from me. One investor concern seems to be that capacity that fails or gets cut this winter could simply come back again next summer, thus undermining a bit the idea of Ryanair having potentially improved pricing power to help pass on the higher fuels. So I wondered how you see that please, Michael. and then one for Neil. Is the 2 billion fuel cost headwind something you now plan to lock in by hedging more at the forward curve, which is about 25% below spot?

16:56 And if that headwind is 2 billion, how much do you anticipate being able to recover by fares, capacity reductions and cost savings? I think Michael said there's a reasonable chance of possibly recovering almost all of it. I'd love to hear your thoughts. Thank you.

17:11 Thanks, Jamie. I'll take the first and let Neil do the second. I don't think that capacity goes back into Europe. I don't see an operator there that will want to take that capacity and restart. They're kind of, you know, everybody wants to be out of the 319s. If you take people who are big in regional Spain, regional France and regional Spain, Those are not growing marketplaces. I'm not sure there's anybody when we pulled out of, we took a lot of capacity out of regional Spain last year in the route with IENA. We moved that capacity into mainland Spain.

17:56 So like we've added capacity in Madrid, Barcelona, Palma, Malaga. Nobody else came in to take up that capacity despite the proclamations of the transport minister in Spain. They're way down in places like Valladolid, Santiago de Compostela, Jerez, and and I think the same will apply up in the Baltic states. We're adding four aircraft up in the Baltic market this winter. It's one of the few areas where we're growing this winter but we're growing in response to significant airport incentives. I think it is dawned now on the Baltic airports that they're about to lose a lot of their existing traffic. Even if I think Baltic re-emerges out of Chapter 11 they will do so with a much smaller fleet I don't think those aircraft will resurface.

18:42 The aircraft that they don't operate will get leased, I think, to other markets elsewhere. The lessors will put them into Asia, Latin America, maybe even the Middle East as well. There is a lot of demand for those aircraft. Airplanes are short aircraft in Asia, Africa, Middle East and Latin America. That's where the demand is stronger. I don't see any of the airlines in Europe wanting to take those aircraft on secondary leases or releasing those aircraft back into Europe the market in Europe is in most of the airlines are losing money so I think there's almost no risk of seeing those aircraft re-emerge into Europe I mean the big issue would be what happens if some of the larger locals maybe Norwegian or Winspear this winter I think there's a real possibility they may and again I think the lessors will be forced to take those aircraft and redeploy them elsewhere outside of Europe I don't see any other European airlines wanting to take those aircraft at short notice certainly not if you look at the very expensive lease rate that Norwegian and Wizz are paying many having done sale of leasebacks I think there's no risk of those aircraft reappearing in Europe next year Certainly if you look at the way the European airlines are managing this winter schedule, they all, including us, originally filed our winter schedules.

20:07 We've since put back that winter schedule in taking traffic down from 216 to 214 million. And almost every other airline in Europe has followed us. They're all taking out capacity. I think not many of them are as well hedged as we are. Most of the European airlines are hedged up to the end of October, at the end of December. and I think it is dawning on them that they're going to have to pay significantly higher prices for unhedged oil and they are cutting capacity accordingly. I think that trend will continue. Neil, 2 billion, if you want to give us your view on how much that will be taken up in fares and how much will be cost savings?

20:44 Sure, I suppose first and foremost the timing of when we're going to hedge, Jamie, it will very much depend on the opportunities in the market. it's a very volatile market at the moment and it's not being driven really by supply and demand it's being driven by events and news flow so we'll opportunistically for the next couple of months jump on dips as we already did to bring our cover from 15% up to 25% we have to keep a very watchful eye on what's happening in the market as well with competitors who are relatively likely hedged into next year the key is that we're very well hedged Out to the end of March, 81% cover, $670 a metric ton or $67 a barrel. If we look into next year, the average rate is somewhere close to $1200 or $120 a barrel. So we look for dips to get in there, but I think if we get into the spring or beyond Christmas we'll probably have to do a bit more meaningful Thank you very much.

22:07 I think we also have to look at the M&A that's going on at the moment, the likes of the Apollo EasyJet. I think we'll see metal coming out on the back of that as well. So I think capacity is going to be well out of the market into the summer of next year and beyond. That gives more pricing power, whether that's 10 or 15 or higher in percentage terms remains to be seen. What will help on the cost side? Well, we get the first 16 MAX 10s in in the spring it's not going to make as big a dent as having more of those in the fleet as I would like but it's still at the start 20% more fuel efficient 20% more passengers and of course all the maintenance warranty so we'll have to look at what we're doing on churning the capacity around you'll have seen it was our airports costs were already down for passenger bases Jason and the team doing a good job there but we'll have to do more of that Thank you very much.

23:25 Yeah, and I will be cautious. I mean, we ourselves, while we've added to our fuel hedge for next year, it's gone up from 15% to 25% on recent dips. We're waiting for the outcome of the midterms and see what effect that has on particularly the Middle East situation. But given the volatility, I don't think, you know, I think before we get to the end of the third quarter, December or early in the fourth quarter, I think we want to see our fuel cover next year probably up around 50% or 50% for the first half of next year. We certainly wouldn't in the current volatile market want to hedge 80%. I think the risk is that oil prices might roll off and we'd catch ourselves, we'd be kind of the wrong side of the market. But I think if we had about 50% of oil hedged in the run into next summer, I think I'd be happy enough to take a risk on these other 50% being unhedged because I think they're still on balance. It's more likely that oil food prices will roll off from their current highs.

24:23 and hopefully jet prices will follow them but there's no way it's going back down to the $67 a barrel which we're at this year. One way or another we're facing a very significant rise in oil prices next year which is why consumers in Europe next year are facing dramatically higher airfares and I would encourage them all to cook early because the longer you wait the higher fare you're going to pay. Next question please. Thanks Jimmy. Thank you. Next question is from Dudley Stanley with Goodbody.

24:51 Please go ahead. Hi. Good morning, Michael. Good morning, everyone. Two questions for me, if I may. The first one is on the max 10. I think you said you're getting 16 now in the spring. That's one more than I had been expecting. Is there any ability to think over the first two years of the contract to get more than the 30 that you originally were getting? And then the second question is related to net income per passenger. You sound increasingly confident on this on the videos about getting to 40 and 50 and I guess what's driving that increased confidence given where we are with fuel at the moment?

25:25 Okay, I'll take two of those briefly. Max 10, I think we will get the 16 aircraft. Boeing wanted to give us one extra aircraft. They don't have any additional spare capacity. We tried. Boeing are still struggling to get production up. They have challenges with wings and engines. But that's as good as we're going to get. We have tried to get more aircraft in the spring of 28 and Boeing just don't have them. There's a big backlog in their own orders. They've committed to meet our contracted delivery dates for spring 27, spring 28, spring 29, spring 30. And that's a pretty good position to be in because I think others are going to have to take delays on their aircraft. So there's no chance to get more than those 16 aircraft. How confident am I getting to 14 or 15 years of air? Very, I think. I still think by 2030, the oil prices, they stay higher for longer. You will accelerate the failures of the flaky Ponzi scheme airlines currently operating in Europe who don't make any money but cover it up by doing mad sale and leasebacks and recognising these kind of money in the P&L.

26:30 There will be more failures. I think the higher, if oil prices stay higher for longer, consolidation accelerates and you can see that with Lufthansa doing TAP and Air France KLM taking majority ownership in SAS. even the Apollo deal with EasyJet, I mean if you look at their public pronouncements, they're going to load check on to the EasyJet balance sheet private equity will want to see a quick return, I think the only way they can do that is by selling some of the EasyJet fleet or parts of the EasyJet operation and the faster Europe can the more Europe can validate the more I think you're going to see pricing power, not unlike North America that the airlines have some degree of pricing power in the system So, I think this is, you know, as we've been here before with oil price shocks, we come out of this usually typically after 12, 18 months.

27:23 Reiner comes out stronger than it went in. Our competitors come out weaker than they went in if they come out at all. And ultimately, the industry is moving towards higher fares in Europe. I mean, it's remarkable in Europe for all of the and Waffle that the commission goes on about being competitive. The only industry where Europe is more competitive than North America is air travel and yet the industries are loading taxes, environmental taxes onto. This is a very competitive industry in Europe but airfares are probably a little bit too low in Europe for the value that we are providing certainly compared to North America. Air pricing has been trending up in North America for the last 10 years and I think we're entering a period of 5 or 10 years when airfares are going to trend up in Europe as well. Next question, please.

28:09 Thank you. Next question is from Jared Castle with UBS. Please go ahead.

28:14 Hi. Good morning, everyone. Michael, if you could just give an update with the European Network Airlines Association and the legal issues around ownership and control, how you see it, and what this also might mean for other airlines in Europe. Should they be successful, let's say? And then secondly... You know, just sizing of the buyback, if you want to give some colour on how you sized it, and also, you know, why you didn't decide to announce it was the 3Q update, given you're only launching it in February.

28:45 Thanks very much. And Juliusz, I asked maybe more appropriately, have you given an update on the ENA update and what you think the likelihood of success is? Sizing of the buyback, you know, we did a buyback last year, $750 million. This year, we've increased the size to $800 million. The timing and the delay timing is just, it matches our cash flows. We are cash negative from October through to December. We go strongly cash positive from January onwards. It makes sense for us at this time of the year to announce the buyback, demonstrate our confidence. I think it's a real buying opportunity for us as a buyback idea will be significantly increasing for our shareholders. But from a cash flow point of view, it makes sense to time it to run from February through to December next year. Juliusz, ENAA or Air France KLM or the Air France KLM Lufthansa attempt to limit competition and choice?

29:41 Hi Michael, thanks for the question Jared. Yes, so Lufthansa and Air France are behind a case taken in the Irish High Court by one of their lobbying platforms called ENA or ENAA. The case has no merit and I think everyone accepts that it will fail, even Lufthansa and Air France themselves. I think what is really interesting in this case and concerning is that two of our competitors decided that it was okay to get together and have conversations about our market capitalization relative to their own, our market position relative to their own, or our commercial strengths and weaknesses in the market. It's just not okay under competition law. That kind of coordination in order to undermine a competitor is simply not permitted, so we referred the matter to the European Commission about two weeks ago filed a formal complaint asking the Commission to investigate what exactly went on in those meetings between Lufthansa and Air France and what information was exchanged and you know if there's an infringement that's ongoing to bring that infringement to an end so I don't think it means really anything for us or for other airlines in the market simply because the case has to fail and I think if I were Lufthansa and Air France, I'd be more worried about the competition law implications of their actions.

31:09 Thanks, Juliusz. From my point of view, I think it's remarkable that you see two hyper airlines, Lufthansa and Air France, who have fought over Sabina, Swiss, Austrian, ETA, TAB, SAS and KLM, have managed to contort themselves to pretend that KLM is still the Dutch airline so it maintains its third party route rights. The Hansen has retained the third party route rights to non-EU points for Sabina, Swiss, Austrian, ESA, EAP all by having this kind of notional sort of construct. Everybody knows these are not Belgian, Italian, Swiss or German or Swiss or Swiss or Austrian airlines anymore and yet These are the guys who, when we get around the table in A4E, agree that actually the ownership rules should be not controlled, but the ownership rules should be amended by the Commission, so that we ignore 1% and 2% holdings by UK or American pensions or passive pension funds, which really have no impact at all.

32:14 In minor, we disbar them from voting, they're not allowed to attend the AGM, they have no shareholder rights whatsoever. And yet this is a platform that these two anti-competitive airlines want to fight on while they pretend that Sabine is still a Belgian airline and therefore can have it maintained by its what do you call that two countries the route rights from Brussels to Africa, Brussels to Asia and Brussels to America but you know the Germans and the French have always had a view that Europe exists to serve their best interests Next question please Thank you, next question is from Stephen Furlong with Davie Stephen Hyde

33:21 Hi Michael, I was just wondering what you think about the price elasticity of demand for European consumers, prices are going up next year, do you think it's just a function of supply and demand, or do you think we might see also more trade down to Reiner low fares, I mean does it matter really if Reiner's fares are 50 or 55, 60,

33:41 etc? Yeah, thanks Stephen, I never waste too much time worrying about the price elasticity of demand, because it's a question I can never answer. I think what has always been the case here is where capacity is constrained in Europe bears right. And there is no doubt this winter and into next summer capacity will be constrained. There is only one lunatic out there adding capacity, not making capacity in the marketplace, that's Wins. They're all over the place. They withdrawed from the Middle East last year. They said they were going to expand in Central East and Europe. They're now actually withdrawing from Poland, Romania, Budapest. to be adding additional capacity into Italy and Spain where they have to compete with Ryanair in Ireland that they have proven time and time again that they can't compete with and eventually they run out of road or at least run out of banks to finance their sale and leasebacks as the debt rise is ever higher but I think there is going to be material capacity constraints in Europe next year I think the big issue for us from a pricing point of view is will the legacies reimpose fuel surcharges on short holes? I think they will.

34:49 Certainly if jet remains up at $170, $160, $170 a barrel. And I don't think we'll even need people to trade down to us. I think, you know, we will fail. We're only going to grow our own capacity by 3% next year, which historically for us is a very low figure. We're already turning along that capacity into new markets in Sweden, Slovakia, Albania, regional Italy. where governments have realised that the way forward is to abolish aviation taxes, lower ATC fees and lower airport fees and if we were to turn capacity away from countries like the UK, France, Belgium, Germany where governments are still raising taxes or have high taxes airports are not lowering their already high costs but they will see decline I mean, and I give you the example of Vienna in Austria. I mean, the Austrians have this mad 12 euro aviation tax. The rate is set to 150 million euros a year.

35:47 This year, Vienna is going to see its traffic fall by about 10%. It's all going at one hour up the road to Slovakia at Glava Airport, and its traffic is going by more than 200%. And even the government party is now calling for the abolition of the aviation tax in Austria. But, you know, it takes a lot of these politicians a long time before they actually work out what needs to be done. Andy Burnham here in the UK is talking about growth in every postcode, where you just deliver a budget that will deliver no growth. If you're serious about growth in every postcode, the industry you should be incentivizing is aviation, which drives tourism, and tourism drives economic activity and growth in every postcode. And what do they do? They just went out, they increased the APD, which you read that already now, increased the APD from 30 to 15.

36:36 for taking on the 1st of April. The budget has failed to roll that back. So until, or less or until, he rolls back that APD in the UK, which is a scandalous and regressive tax on poor people's family, there won't be growth in every postcode. Thanks, Stephen. Next question, please. Thank you. Next question is from Savvy. This is from Raymond James. Please go ahead. Savvy, hi.

37:01 Hey, good morning. Just maybe on the first one, you know, you have that idea of aircraft deliveries next year and you're further along on the engine shop. Just curious if you had an update on, you know, where the potential capex for fiscal year 28 could go. And then secondly, could you just remind how much of your December quarter and March quarter tickets have been sold so far?

37:23 Okay, Neil, you want to take the capex out to 28?

37:27 Yeah, sure. Savvy, just I suppose, somebody's going to ask about 27 as well, so FY27 we're expecting to be pretty close to about 2 billion capex and there's been no real change from what I've said in some of these previous calls in relation to FY28 so we're still somewhere between about 2.7 billion and 3 billion into FY28 Great, and the second half of the question the December quarter at the moment we're about 50% sold for the December quarter and the March quarter at the moment we're about 8% sold

38:02 So we have almost no visibility on the March quarter, reasonable visibility on the December quarter, and I think, you know, the real change in this morning's commentary is the fact that pricing has turned around. We are now looking at bears modestly up in Q3, having been down 6% in Q1 and down 2% in Q2. Thanks, Ravi. Next question, please. Next question is from Connor Dwyer from City.

38:31 Conor, hi.

38:34 Hey, morning, Michael. First question was just on the capacity guide itself. So I'm just kind of wondering how locked in is the 3% passenger growth? Obviously, the max 10s give you the majority of that, but I'm wondering, you know, do you potentially manage capacity down by just utilizing the older 737 NGs? And then second question is just on opportunities in a market like this. Obviously, on slide 9, and some regional operators. My question is around firstly, are you having any conversations with airports on the back of any of this? But also secondly, in terms of opportunities around fleece, would you ever consider buying up some older airplanes at a good price?

39:19 Jason, you on the call, give us an update on the capacity guide both this winter and 3% for next year. and then I might ask Eddie, give us a flavour of what's happening on the opportunities at the airport churn discussions where competitors are struggling or failing. Jason, over to you first on the capacity. Yeah, so on the capacity guys, so in terms of market overall, as Eddie said earlier, it's about the market growing by just over 2%, we're flat. What's interesting, Conor, is when you look at the individual country markets that are behind, so the likes of the Austrians, Belgians, all almost double digits down, Germany, France, UK, all capacity falling in all those markets and where capacity is actually growing this winter is the markets Ryanair is growing in like Albania, Slovakia, Morocco and Poland are all growing by double digits this winter we're adding aircraft into all of those markets it's the first winter of our Toronto base and also we're adding additional aircraft into Poland when you look into next summer no one knows where capacity will be for next summer our capacity will grow We will add the 3% capacity into summer because we will use the max 10 aircraft. There is a huge demand for those aircraft at the moment.

40:37 In terms of the market capacity, I think my own view is I think next summer you're looking at broadly flat, maybe slightly down. Because I think as we said earlier, a lot of the flaky airlines will fall over this winter. And just before I hand over to Eddie, in terms of market opportunities, I think you'll see us growing rapidly. where we've grown over the last 12 to 18 months. The countries are engaging with us to reduce airport charges and reduce taxes and they by and large have been countries, the Central and Eastern European countries and particularly the Italian regions working with us to reduce taxes. We have between 10 and 12 airports every week coming to head office here to present growth plans.

41:17 Actually, maybe do me a favour, what's in Dublin where I think the Irish aviation, the regulator, does their particular favourable commentary given that they're talking about reducing the Dublin airport fees high fees by 15% next year what's our response to that? So we're adding two million seats and three additional days to aircraft into Dublin. You're right, the Regulars came out with the interim decision two months ago. We expect the final decision within the next few weeks. And we will, once that decision is confirmed, we'll grow in Dublin next summer. It's a sensible decision and we're going to grow into it. Good.

41:58 Okay, Eddie, maybe on opportunities or what's happening with the airport, where do you see opportunities this year? More growth at discounty airports or are we going to go out and try and buy second-cheap, second-hand aircraft and do something with aircraft? I know where I'd like to take my best at discounty airports rather than buy more cheap aircraft. I think what we... I mean, if you look, there's generally a combination of there are... They've got less options in a lot of these airports and where to actually... Thank you very much. and you know you have Scandinavian airports that are particularly challenged and are now waking up to the fact of it. Italy where ETA have you know pulled out wholesale out of regional airports and I think that's why you're seeing that sort of breaking wave of municipal tax that has spread right across the regions and may make its way hopefully to Rome at one stage because that's what's driving the traffic growth there. You can see in Spain with all of our PR down there on taxes and even though the regional airports are still hopelessly

43:31 uncompetitive and you know there has been there's been less of an increase down there which as you had alluded to earlier Michael that we're still growing at places like Malaga, Alicante, Palma and even where we can pick up slots from places like Madrid and Barcelona and the UK where we've just completed a deal with Stansted so like we're out there for the next eight years and it's the only We've locked out pretty much all the airports there and then Morocco as well we could see with the back base opening and there's a hunger down there for what miners delivered.

44:29 We're doing domestics down there and they've got the whole 2030 World Cup coming up with Spain and Portugal as well where they're anxious to grab additional traffic from the only airline that they can, you know, not just in Morocco but everywhere they can see an airline that has capacity coming, has the business model, and, you know, keeps the promises that we make on capacity. So, it's right across the piece and, you know, you are seeing airports going in that we haven't heard of or would not normally come to us first and now have plans on, well, we're thinking of building this terminal, we're thinking of doing this for you, etc. Now, it generally falls over on price as we get there but you are seeing a change out there in airports that know that there aren't enough, there aren't many options left out there except right now.

45:18 Yeah. Let me add in on the cheap second-hand aircraft. There aren't any cheap second-hand aircraft. If you take aircraft that are likely to fall over, the fleet of Valerian, largely A319s, they'll finish up outside Europe. We have no interest in those aircraft. Air Baltic operates the Airbus 220. again it's a kind of a unique aircraft, no interest I'm not sure any airline would have any significant interest in that aircraft going forward we don't see any significant opportunity on cheap aircraft partly because there's still unsatisfied demand for easy second hand aircraft in Asia, Latin America, Middle East Turkey or short aircraft I think that the chances are that second hand aircraft are expensive and that they will reappear elsewhere outside of Europe so I think the opportunities can come from And the reason we talk about other airlines failing is not because we, you know, don't wish them well. It's because their airports are coming to us now, offering us more and more impressive firms, getting us to commit to actually switching some aircraft into those airports if or when they believe their incumbent airlines will fail.

46:29 Next question, please. Thank you. Next question is from James Collins with BNP Paribas. Please go ahead.

46:35 James, hi. Hi, morning. Michael, maybe for you, maybe for Tracey.

46:40 Just on those expected pain freezes, do we expect much resistance to that?

46:46 Is it something you can simply do without any resistance, particularly if you're doing a buyback, which might seem slightly aggressive? And then secondly, Michael, I don't know if your views have softened or changed from Starlink at all. Clearly, where's the easy jet pushing ahead? Maybe just some views on that. Thank you.

47:03 Yeah, pay freezes, look, I mean, what we're worried this morning is the situation is going to get a lot worse. We've just done, we've done pay deals that most of our pay agreements, almost all the pay agreements that came up for renewal this year have now been done. We've done multi-year pay deals. Those pay agreements would be honoured, so if they have a pay increase agreed for next April, that should go ahead. We have a number of pay deals next April, Dublin pilots, UK pilots, Spanish and Portuguese pilots who are coming up for renewal. We said now we're willing to do those pay deals early and go early. Some of them think they want to wait because the world is going to improve in their favor. I don't think it will. But if they go early and they get the deals done before March, April, they won't be subject to a pay freeze.

47:48 If they wait until April, I'm pretty certain they will be getting a pay freeze. If they were to go on strike, it would save us money in March, April next year if oil is at $170 a barrel. It costs a Ryanair pilot typically a grand a day to go on strike. I wouldn't want to encourage strikes, but you know, we have shown that we're happy, perfectly willing to accept strikes. And if somebody wants to go on strike when the world is falling apart around them and they have no alternative jobs in any other, there's no, our pilot nutrition has fallen to almost zero at this point in time. And that's entirely, they're entirely within their rights to do so. But it would be helpful to us if there were strikes, I think in next April, May of next year. Certainly from a financial point of view. But we're in discussion with those groups. If they're serious and they want to get on and do pay deals, advantageous pay deals, such as the ones we've done recently in Italy, in Central Europe, in Sweden, in France last week, then by all means do it.

48:46 But if you want to wait and hang around, you risk getting caught, and we would not be in the least bit... Sorry, that's not fair. if they want to go on strike they're perfectly free to do so and we'd be perfectly willing to accept strikes in the short term they would save us money look again my position on Starlink we had a big row with Elon Musk 18 months ago Starlink is a very good system but the technology has a 1.5% fuel drive and with oil going to jet oil at $170 a barrel the last thing I want to do is to install any system that has a 1.5% fuel penalty We know EasyJet have announced they're going to bid darling. It's not clear to us whether they're going to give it away for free.

49:33 I understand the free thing is that they're going to charge passengers for it, which I say, well, good luck with that. We are pretty certain that if we charge, ask Ryanair passengers to pay for Wi-Fi on board, they won't pay. The average flight time is an hour and 15 minutes. There isn't a lot of transaction time to charge people for the Wi-Fi. And it simply will not pay for its cost. We've had extensive discussions with Arlink. They were willing to pay for the installation on board our aircraft. When the discussions broke down, they believed 60% of our passengers will pay for free Wi-Fi. Which we said, you've obviously never met an airplane passenger in your life. I believe if it's free, some of our passengers will use it. Most of them bring their laptops on board and they're watching Netflix or whatever Disney channels they have.

50:22 I'm not sure. I think the demand for Wi-Fi on both short-haul flights is there, but only if it's free. And if it has to be paid for, there's no revenue model whatsoever. I think in the other cases, I think in the case of Wizz, they're talking about putting on Starlink, but that the provider has to get the income. They're not getting anything out of it at all, apart from a kind of a gee whiz, here's a passenger initiative. As always, we would be more disciplined... I do think the technology has continued to innovate and I think in the next year or two there will not be aerials on the outside as usual as you'll be fitting aerials either in the nose cone or the baggage hold or the forward or the rear galley and then we'd be quite happy to put Wi-Fi on board our aircraft as long as we get it free and we can pass it on to our customers free.

51:11 Next question please. Sorry, can you add on the pay freeze or the risk of pay freeze? I'm just saying, Neil McMahon here, the Director of Office with me. Look, we've done deals with the groups that had their pay agreements ending at the end of March 26th. We've now got a bunch of groups that we're meeting, we have been meeting for the last number of months, and the message is quite clear.

51:35 We're willing to do an agreement, but if they want to hold out, into beyond April next year with the deteriorating market conditions with oil at $170 per jet fuel barrel, then we're not willing to, and they want to take a chance on us, then we'll let them go. There is a risk that somebody will take us on, and if that's the case, we'll let them go on strike. But there is deals available, but they won't be there forever.

52:00 And Darren Hughes, I know you're on the line there. Chief People Officer, do you want to put anything on that on paper, a possible free freeze? Let me know about it. It's just one of a number of cost aid things that we'll be looking at. Charles? Yeah, no, Michael, look, it's been well covered there.

52:14 As Neil said, we've got quite a few groups up next April, and by default, if they don't do a deal, then there's no pay increase. And we'll probably see a couple of groups who are on strike next summer, and we'll just have to face that down.

52:27 All right. Okay. Thanks very much. Next question, please. Next question is from Dwayne Fenningworth from Evercore Isle.

52:35 Please go ahead. Dwayne, hi. Hey, good morning. Thanks. So you touched on a lot of this, but you're still well hedged out through March. We're starting to see short haul industry capacity finally adjust in the December quarter. So just wondering if you could put a finer point on when you expect an inflection in fair growth. What quarter do you think we'll begin to prove out the pricing power that Ryanair has? Do we really need to wait until next fiscal year or could it come sooner?

53:08 I think we've already seen the inflection point, Dwayne, since the morning's results. You know, the Q1 this year, average fares were down 6%. Now, some of that was at the first half of April, of Easter, moved into March. Q2, which is the peak summer, lots of demand, 94% load factor, average fares were down 2%. And the inflection point is, as we move into Q3, which is traditionally the time when, you know, fares come under pressure, winter capacity, that is, we've seen fares since about the first week of August have started moving meaningfully upwards. So fares in Q3, as we said this morning, have turned around. They're now up modestly, you know, but it is growing week on week, modestly ahead of the same quarter last year. That is the inflection point, and I think that's the start of it. It is driven by, and on a daily basis, more of our competitors are taking out capacity in November, December, January, February, March.

54:02 And I think that will run into the fourth quarter. The fourth quarter this year is going to be slightly distorted because you both have the Easter in March. So the fourth quarter is going to look like a bumper quarter on years, only because Easter's in there. And then the following Q1 will look like it's week because you've no Easter at all in Q1 compared to half Easter last year. But I think we've already hit the inflection point. We are seeing meaningful movements in airfares. At a time of the year when normally we're pricing down and having to increase the amount of or stimulate price stimulation we do, we're having to do less price stimulation bookings and continue to run strongly ahead. Jason, do you want to add to that point? In terms of Q3, we're coming off the midterm, we had a good midterm.

54:54 November is positive and I think we have as you said 50% booked for Q3 a lot will depend on how the final out term for Christmas but so far it's looking strong so I'm happy what I'm seeing for Q3 early indications although very early for Q4 also strong but I do think this is being driven by our the capacity reductions that are coming out week on week from competitors across the market I would say like we've I think that's likely to continue and I think what you will see is probably lots of close-in cancellations from our competitors as well over the next number of weeks.

55:39 Alright, thanks Jason. Next question, thanks Green. Next question please. Next question is from Harry Gowers with JP Morgan.

55:47 Hey Harry. Morning guys, morning Michael. First question, I think most people equate obviously fares to being the main lever to raise pricing to offset the higher fuel but anything you can do in terms of raising ancillaries more aggressively to offset the fuel headwind or is that just not feasible and you know fares will be the main leader and then second question just on those ex-fuel cost initiatives as well we talk about airport staff, pay freezes, AI Any numbers yet you can give in terms of quantifying the benefits there and will all of this be March 2028 impacts or can some of it come sooner over the winter?

56:25 Thanks a lot.

56:26 Thanks. I'm going to ask Tracey McCann here to take the ancillaries question and then Neil I'll give you the ex-fuel cost into FY28. Tracey, ancillary.

56:35 So ancillaries we've seen them last for the half year. We'll probably see roughly 1% for the full year. We're probably really capped out. It's more about dynamically pricing now. The PV and seats, I'm trying to optimize the total revenue. So a lot's done with AI on the dynamic pricing with GLAAD. And then we have order to seat, which is doing well on board. So that's where you can order your future seat before you even get on the aircraft. So a small little few things around the edges, but no big dramatic change or nothing.

57:08 And Nita, Ex-Fuel Tom, this year or next year?

57:12 Yeah, I'd just add on the ancillaries, Harry, that as we said before, just keep modelling with kind of 1-2% for passenger growth moving forward, so we were up 1% in the quarter just ended. On ex-fuel, well, we're already seeing some of the benefits coming through just with the airport deals that we have in place into the winter and into the spring and summer of next year, so that will feed into our numbers, but we'll get into more of the weeds when we come back from the road and start doing the budget process for next year and so there's a bit to go at this stage and as I said then we've got the first of the markets coming in as well.

57:51 Yeah okay thanks Neil, thanks Harry, next question please. Next question from Andrew Lovenberg with Barclays, please go ahead. Andrew hi, can I ask on the chart that you're doing so assertively to control costs, Do you see any corresponding impact on the unit revenues? You've added these fuel hedges.

58:44 Are they spread evenly through the year or are you weighted further out to get the cheaper fuel or are they weighted closer in to give you more protection? And how do you expect to build the hedges as you go forward? Evenly or perhaps more to protect for the summer?

59:01 Okay, maybe I'll do the churn. I'll ask Neil, maybe you can come back in on fuel. And I think don't get distracted by the churn, Andrew. Yes, We're not churning out of kind of mature routes into immature routes. In a lot of cases, we're churning into airports. Airports are doing deals with us to attract our growth incentive, but because they've either existing incumbents declining or cutting capacity or going bust. While we are moving our capacity into those markets or churning into markets like Sweden, for example, in Atlanta, like Slovakia, regional Italy, These are markets that were either previously underserved but are strong markets for us anyway. So we're going into those markets. We're not taking any yield penalty, but we're getting a huge cost savings.

59:48 Again, I go back to Sweden where the new government there, a very visionary transport minister has abolished the aviation taxes in the home of Greta Thunberg and Flood and Flight Shaping. that abolition and we're going in on mature routes in our land but there's not a lot of growth in our land other than what we're delivering so we're seeing a yield benefit and a cost benefit also remember where we turn out of an airport we have less capacity at the existing airport say for example Charlevoix this winter we're going down from I think we had 19 aircraft down to 12 Vienna we went down from 20 aircraft this winter to 14 You see a big bump in fares on the remaining heavily constrained capacity in those markets as well.

1:00:38 So there are significant compensatory effects of churning aircraft out of an existing airport where you're reducing demand. Now, we're not talking about Berlin, obviously, where we closed the base altogether. But we're still operating about 50% of our capacity into Berlin, but without morning and evening services, and we're seeing a bump up in airfares. when you churn out into a lower cost airport yet you may at the moment we don't have to take a pricing penalty and we get a pricing benefit on those airports that we churn out of which is again why again I come back to I think that the point that jumps out to me is this morning's press release is not the obvious one it is that pricing has turned around in the third quarter and having been down in Q1 down in Q2 suddenly it's up in the shittiest quarter of the year That is, I think, that's the one takeaway I would take from the press release this morning. The big question, will it go up by 20% next year for the whole year?

1:01:36 And I think that's a bit overly optimistic. But I think we have a reasonable shot that it will go up by some good double-digit number and we'll close off the rest with cost savings. Neil, if you want to touch on the fuel hedging, is it spread across the year or confined into quarters? Anything you want to add on fuel hedging?

1:01:54 Sure, Andrew, I'm sure you've seen slide 13 of our presentation where we're talking about 25% of $9.54 a ton. That's spread pretty evenly across all four quarters. We've a slightly higher rate in H1 where we're about $9.80, slightly lower rate in H2 where we're about $9.20, giving the blend of $9.50. As Michael indicated earlier on, I think the next focus when we come back into the market will be on the first half of the year where we'll probably, as indicated previously, try to get that up towards 50% before we get into the peak summer period. It's the same on the FX as well, so the Euro dollar spread across the year at 119, just over 20%.

1:02:44 Tom Fowler, you're on the call, does anyone have a call on fuel or fuel hedging? No, no, I think Neil's covered it all off there Michael, so we evenly hedge across every quarter, typically we don't tend to wait too much when we start our hedging Fine, but I agree to say we're waiting for the outcome of the mid-turns before we make any further decisions I think between now and the end of the year on hedging cover Yeah, we have the team in Dublin, time to go if there's any tips this week Fine

1:03:13 Okay, next question please. Thanks Andrew. Thank you. Next question's from Axel Stass with Morgan Stanley.

1:03:20 Please go ahead. Yeah, morning everyone. Thanks for doing my questions. To your mind's eye, first in the fair, so when you fit the little digits into 2028, and obviously the normal bridge to get there. So is it fair to assume that when you say modestly up, it is mid single digit in Q3 and then high single digit in Q4 because of ether? And then my second question, and I know you said the budget still needs to be done for next year, but what do we expect in terms of unit cost inflation excluding the fuel heading to next year because of the labor agreements and the higher maintenance? Is low single digit a reasonable expectation for now or would you say that's too low? Thank you.

1:04:00 Yeah, okay, look, I wouldn't want to add any more on fares. I think what we said this morning is that Q3 is now trending modestly up, and modestly would be, I think, mid-single digits. But, you know, we've only 50% of Q3 sold. Q3 is hugely driven by the final bookings in the run-up to Christmas, but I think it augurs well for continuing strong fare performance in Q3. Q4 will be up double digits but Q4 is artificial because we both have the Easter in March next year and therefore it's a slightly distorted figure so I wouldn't lose the run of ourselves on that but I think that does give us a good basis going into next summer we and all the other European airlines I think there will be more failures in Europe this winter, some of the Ponzi schemes will finally blow themselves up I think there will be real capacity constraints next year and I think that Neil, you want to take the fuel question?

1:05:03 Yeah, Axel, I wouldn't normally give you guidance on next year at this time. We're just going to get stuck into our budgets. We will be looking on a line-by-line basis as to where costs may go, but it's too early to get into details and guidance for FO28 and unit costs.

1:05:23 But I think we're looking at, I mean, FY27 unit costs, you know, we're still looking at ex-fuel up maybe 2-3% on the full year despite having cut back the traffic. You know, we are, that widens the cost gap between us and every other European airline on an ex-fuel basis. And that gap will get wider again in FY28. I'm not sure really, again, we have to wait until the outcome of the budget. to see what some of the airlines or the other airlines are doing on wage settlements, airports, I mean complaining about the airport cost inflation and the cost inflation. So they are struggling and then they have, unlike Reinhardt, they have huge increases in financing costs. The cost of debt is rising, the cost of aircraft pieces are rising, the dollar is strong at the moment. That cost gap is widening materially into FY28 which puts Almost worth the pressure on our competitors to get airfares up, and they would drag our fares up behind.

1:06:18 Now, I've seen some stupid analysis, I should say, you know. When do you not see stupid analysis? But I've seen a lot of stupid analysis here that fuel costs rising for Ryanair with fuel is a higher percentage, and therefore the rising fuel will be a bigger impact on Ryanair. You don't seem to understand that if the FANSA gets, you know, puts a 10-year fuel surcharge on next year, 10 euro increase in Lufthansa's average airfare is nothing whereas the 10 euro increase in Ryanair's average airfare next year is a 20% increase in fares and yields so it's like for like yes we have cost pressures but we're under an awful lot less cost pressures given our margins than any other European airline is they're under much more pressure to get pricing up and to the extent they get pricing up our price will move by a much bigger percentage percentage by a much bigger percentage, therefore maintaining or widening our margins.

1:07:15 Next question, please. Thank you. We have no further questions in the queue, so I'll hand back to you for any closing comments.

1:07:22 Wonderful. Okay. Look, I think we've covered everything in some detail. Obviously, the big issue for the next 12 months is where fuel will be and where fares will be, and those are two moving variables that we can't give you any particular guidance. Your view is as good as ours today. I think the key kind of drivers will be the US midterms this week and what's the outcome after the US midterms, what impact does that have on the situation in Ukraine and the situation in the Middle East. Nevertheless, I go into, I think, 2020, calendar 2027, quite excited. We're really excited by the MAX-10 aircraft. These are going to be transformational. We only get the first 16, but any aircraft that has 20% more seats and burns 20% less fuel will is going to transform our economics. We have much bigger margins than any other airline in Europe.

1:08:11 We can afford to pay higher oil costs for longer than any other airline in Europe. Fares are already beginning to move upwards into the Q3, which is the worst quarter of the year. And I think you're going to see more failures and more capacity reductions in Europe this winter. Running through into next summer, as Jason said, he thinks at best capacity in Europe next summer will be flat. If some of the other loonies fail, it will be down year on year. Pricing will be strong. And I think we will, as always in a crisis, do better than any other airline because we have the lowest fares and the lowest costs. We think now is an ideal time to buy. Clearly, I apologize, the share price performance has not been good this year to date.

1:08:58 We think that's the timing to announce another share buyback and we lead in with another 800 million share buyback next year. Personally, I hope the share price stays reasonably subdued until we complete that share buyback. But unfortunately, I'm not in control of the share price, the markets are. But I look forward with some considerable optimism. Has anything in the last 12 months altered my view that we are moving towards a period of consolidation in Europe or that our profit per capita will rise to 14, 15 euros per capita? No. Thank you very much. deliver positive returns to our shareholders.

1:10:00 We have a full road show of teams in every geography, Ireland, UK, Europe, America, East, West Coast. If you want a meeting with us, please contact one of our brokers, City, Goodbody or David and we'd be happy to set it up and if you can't make it this week, please come to Dublin at any stage over the next between now and the end of the year. We'd be happy to see you in Dublin and show you the operation. Thank you very much everybody. Look forward to either meeting you or just talking to you later on this week. Thank you Seb, you got the end of the call.