Lossmaking Ryanair turns to discounts as Omicron dents bookings

Ryanair said it would discount flights to stimulate demand as coronavirus uncertainty hangs over the aviation industry, after the spread of the Omicron variant dented bookings in the final three months of 2021.

The airline warned of “huge uncertainty” for pricing and yields through to the end of its financial year in March, adding that investors should expect further coronavirus-driven disruption to impact air travel before the region can call an end to the Covid-19 crisis.

The low-cost airline reported a net loss of €96m, better than the €321m loss in the same quarter a year earlier, on revenues of €1.5bn from 31m passengers in the third quarter.

The Irish carrier suffered a drop in bookings and cut January flying schedules after European governments reimposed tougher border restrictions at the end of last year in response to the rapid spread of the Omicron coronavirus strain.

“In recent weeks . . . particularly with the UK and Ireland easing restrictions we’ve started seeing more people taking a view on their summer holidays and Easter breaks,” Neil Sorahan, Ryanair chief financial officer, told BBC Radio 4 on Monday.

“I’d be very hopeful that over the next number of weeks, as more European governments start to relax restrictions, we’ll see more bookings,” he added.

Following the “steep declines” in filled seats on flights, Ryanair said that passengers were continuing to book at the last-minute, and “significant price stimulation at lower prices” would be needed to encourage a recovery in air travel.

Ryanair reaffirmed its expectations that it would fly just under 100m passengers this financial year and its full-year financial guidance, which the airline doubled in December to a net loss of €250m to €450m.