Ryanair’s shares soared on Tuesday morning after the airline group’s chief executive, Michael O’Leary, signalled in an interview that the threat of a double-digit percentage drop in average air fares has been averted.
Shares in the carrier jumped as much as 6.1 per cent in early trading in Dublin to almost €16.04. Mr O’Leary told Reuters on Tuesday that he no longer sees a risk of double-digit percentage falls in average fares this summer as weakness has “levelled out”. He said that a decline of 5 per cent for the period now “looks reasonably accurate”.
The gain comes five weeks after the stock fell by more than 17 per cent in a single day when it warned it expected fares to be “materially lower” across its crucial summer season when compared with last year, continuing a trend that saw average fares slump 15 per cent in the three months through June.
Meanwhile, Ryanair confirmed in a statement that it has completed a €700 million share buyback programme that it launched in May, with 38.6 million shares – including underlying American Depository Shares – being repurchased and cancelled over the period.
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The carrier is now proceeding with a follow-on share buyback scheme, having hired Davy to mop up as much as €800 million of stock on its behalf in the open market before the end of next May.
Michael O’Leary also said on Tuesday that relations with Boeing’s new management were “difficult” and that deliveries continued to be behind schedule.
The airline, one of Boeing’s largest customers, said there was a risk it would take delivery of just 20-25 of the 737 MAX aircraft ahead of next summer, rather than the 29 scheduled, he told Reuters. Still, Eddie Wilson, chief executive of Ryanair DAC within the wider group, indicated he was confident that Boeing will overcome its production issues.
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