Ryanair Holdings (RY4D) Q2 2027 Earnings Report

The call was optimistic about Ryanair's relative competitive position, balance sheet, fuel hedging for the current year, MAX 10 efficiency, improving fares, and shareholder returns. However, first-half profit declined 15%, fares were lower during the peak summer period, operating costs rose, and management faces a EUR 2 billion FY28 fuel-cost increase with limited visibility and no meaningful FY28 guidance. Management nevertheless emphasized that Ryanair is better positioned than competitors to manage the disruption and expects pricing and market consolidation to support future profitability.

Ryanair expects FY27 traffic to grow now slightly less, 3% to 214 million passengers, with winter traffic from November to March broadly flat year-on-year, and next year traffic at 220 million passengers, or just over 220 million passengers, representing 3% traffic growth; the market expects profits of about EUR 1.7 billion-EUR 1.8 billion this year, with a reasonable chance to maintain that into FY28, although it is too early to provide meaningful FY28 profit guidance. FY27 jet fuel remains 80% hedged at $67 a barrel out to March, FY28 cover has risen from 15% to 25% at an average price of $95 per barrel, and the company would want fuel cover next year probably up at around 50% or 50% for the first half of next year. A EUR 2 billion increase in the fuel bill next year requires about a 20% increase in airfares, or about EUR 10 per passenger; double-digit fare increases are expected, with Q3 trending modestly up, interpreted as mid-single digits, and Q4 up double-digit percent. FY27 ex-fuel unit costs are expected to be up maybe 2%-3% on the full year, while it is too early to get into details on guidance for FY28 on unit costs; FY27 CapEx is expected to be fairly close to about EUR 2 billion and FY28 CapEx somewhere between about EUR 2.7 billion and EUR 3 billion. The company expects 16 MAX 10s in spring 2027, with 20% more fuel efficiency and 20% more seats, and will launch another EUR 800 million share buyback from February through to December 2027 alongside an interim dividend of EUR 0.273 per share payable in late February 2027.