4th Feb 2019 07:00
LONDON (Alliance News) - Ryanair Holdings PLC on Monday said it will make changes to its structure after swinging to a third-quarter loss and warning of lower annual profit.
The Irish budget airline said that over the next 12 months it will move to a group structure not dissimilar to that of rival International Consolidated Airliners Group PLC, owner of British Airways and Spain's Iberia.
Under the proposed changes, a small senior management team will oversee the development of four airline subsidiaries, Ryanair DAC, Laudamotion, Ryanair Sun and Ryanair UK.
Chief Executive Officer Michael O'Leary will become group CEO, leading all the units, the airline said. The company will, later this year, appoint a replacement as CEO of Ryanair DAC.
Chair David Bonderman and Senior Independent Director Kyran McLaughlin have agreed to remain on the company's board until summer 2020. They will leave after that date.
"In order to ensure a smooth succession, Stan McCarthy who joined the board in May 2017, has agreed to take up the position of deputy chair from April 2019, and will transition to chair of the board in summer 2020," Ryanair added.
Meanwhile, the airline said its third-quarter results were disappointing, with the group swinging to a EUR83.6 million pretax loss from a EUR112.9 million profit in the comparative period a year ago.
The company's loss included a EUR61.5 million loss resulting from the acquisition of Austrian airline Lauda. Excluding Lauda losses, Ryanair reported a EUR6.5 million operating loss versus a EUR126.0 million profit a year before.
Revenue rose 9% to EUR1.53 billion from EUR1.41 billion on the back of higher customer numbers, up to 32.7 million from 30.4 million a year ago.
O'Leary said: "While a EUR20 million loss in the third was disappointing, we take comfort that this was entirely due to weaker than expected air fares so our customers are enjoying record low prices, which is good for current and future traffic growth."
Ryanair load factor was unchanged compared to the prior year at 96%.
Looking ahead, Ryanair said that, excluding an expected "heavy" loss from Lauda in its first year of operations, its annual profit will come in between EUR1.0 billion and EUR1.1 billion due to lower winter fares but better-than-expected cost performance in the second half.
A year ago, Ryanair profit was EUR1.45 billion, so the decline will be as much as 31%.
"While we have reasonable visibility of our fourth quarter bookings, we cannot rule out further cuts to air fares and/or slightly lower full year guidance especially if there are unexpected Brexit and/or security developments which adversely impact fares for close-in bookings between now and the end of March," the company added.
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