Q1 2026 Ryanair Holdings PLC Earnings Call
To the Ryanair Q1 results conference call I'm joined by all of our usual crew and CFO is in London as Eddie with dialing in from London dresses are here in the office in Dublin as you've seen this morning, we reported a strong Q1 profit after tax rising to $820 million.
Compared to our prior year Q1 O $360 million traffic grew 4% 58 million passengers at 21% higher fare Q1, as we have repeatedly told you is.
Actually strong mainly due to weak prior year comparison last year, we only had one half of Easter in April and we were in the teeth of the Otas boy cost through Q1 into Q2 last year. So if you go back to year, we made $660 million in Q1 of 2023.
We met that fell last year with the Easter and Otas, you're down to 300 and.
At $360 million in Q1 of 2024, and then we recovered strongly to a more normalized $820 million in Q1 2000 in June to our Q1 2025 over the two year period.
Over the two year period, the Q1 profit drop about 24% rather than this morning's reported up 128% against prior year comps last year, but.
Still a good number and a good performance. The Q1 highlights include traffic grew 4% to $58 million as you know our traffic growth has been constrained by Boeing said delivery delays revenue per passenger rose, 15% average fares were up an artificial 21% in that quarter ancillary revenues up 3% on.
Top of 4% profit growth.
The number I'm most pleased with is unit cost control. So unit cost inflation was up just one 1% the cost gap between us and all our other EU competitors has widened materially during Q1, we.
We took delivery of five game changers in Q1, bringing the total game change your fleet to 181 aircraft at the end of June.
Some of them were operating over 160 new routes.
Opportunistically, Turkey spare leap <unk> engines from Seattle, We got a negotiated a significant discount off of that engine order and therefore is the judicious use of our money.
In order to protect resilience as the fleet of game changing rates to 181 aircraft and we were very pleased that ryanair, whereas the MSCI World Index in June and expect to be added to the FTSE Russell in September.
Just turning I won't dwell too much on these numbers speak for themselves, but again I want to stress again Q1 fair substantially benefited from having a full Easter holiday in April weak prior year comparison, and marginally stronger than expected close in bookings operating cost rose 1% per passenger as our jet fuel hedging largely.
Offsets a significant ATC fees increased and hire an indefensible environmental costs as Etfs allowances unwind in south mandates impact.
However, we are well hedged.
But for the next two years with FY 'twenty takes almost 85% hedged at $76 a barrel and we now have 36% of FY 'twenty seven hedged at just under $66 a barrel at 13%.
The balance sheet remains strong at the end of the quarter net cash was up a 2 billion euros, leaving us well positioned to repay the two large bonds. We have over the next 10 months, including an $850 million bond repayment due in September and one 2 billion in May of next year, which we now expect to repay from our heads.
Internally cash resources as I said, we welcome. The addition to the MSCI World indices unexpected joined the FTSE Russell following their semiannual review at September <unk>.
In terms of fleet. We this summer we have a 181 game changers in the fleet. That's an increase of 25 aircraft from June 2024.
The.
Facilitation.
Strained growth of 3% this year to 206 million passengers. We remain confident that 2009 remaining delayed game changers in our 210 order book will deliver well ahead of our summer 'twenty six.
Unknown Executive: Gentlemen, and welcome to the Ryanair Q1 results conference call.
We take heart from Boeing's recent confirmation they expect the Max.
Unknown Executive: I'm joined by all of our usual crew, Neil, CFO is in London, Aziz, Eddie Wilson dialing in from London, the rest of us are here in the office in Dublin.
Unknown Executive: As you've seen this morning, we reported a strong Q1 profit after tax, rising to €820 million, compared to a prior year Q1 PAT of €360 million. Traffic grew 4% to 58 million passengers at 21% higher fares.
Speaker Change: Deliveries of our horse 15, Max 10 in the spring of 2027 impact Stephanie Pope wrote to me last week confirming those first 15 deliver her confidence in those are 15 deliveries.
Unknown Executive: Q1 as we have repeatedly told you is and OTA down to $360 million in Q1 of 2024. And then we recovered strongly to a more normalized $820 million in June Q1 2025. Over the two year period, the Q1 profits are up about 24%, rather than this morning's report up 128% against weak prior year comps last year.
In the spring of 2007, which we think is good news.
Fuel hedging. Largely offset. A significant ATC fees increased and higher in the indefensible environmental costs as ETFs allowances unwind and South mandates impact. Uh, however, we're well hedge. Uh, but for the next 2 years, with FY, 26, almost 85% hedge at 76, dollars a barrel. And we now 36% of FY, 27 hedge that just under 66 dollars, a barrel of 13% saving
Speaker Change: Overall, the trend we've been highlighting over the last a year or two which is severely constrained European short haul capacity will continue I think for the next five years out to 2030, principally driven by the two big Manufacturers', Boeing and Airbus remaining well behind other aircraft deliveries and many of Airbus Air Europe Airbus operators.
Speaker Change: Working through their practice with the engine repairs and EU airline consolidation continuing these industry capacity constraints combined with Ryanair is ever widening unit cost advantage, our strong balance sheet, our low cost aircraft orders and industry, leading ops resilience will we believe facilitate ryanair is controlled profitable growth to 300 million passengers.
Speaker Change: By FY 2034.
Speaker Change: I would just wanted to touch briefly on the outlook.
Speaker Change: You see in our numbers. This morning, FY 'twenty six traffic remains on track to grow just 3% to 206 million passengers. This is due to heavily delayed Boeing deliveries, we expect very modest unit cost inflation in FY 'twenty six as the delivery of more game changer aircraft are advantageous fuel hedging unaffected.
The balance sheet remains strong at the end of the quarter. Net cash was up at 2 billion euros leaving as well. Positioned to repay the 2 large bonds. We have over the next, uh, 10 months, including an 850 million Bond repayment due in September, and 1.2 billion in May of next year, which we now expect to repay from our healthy internal cache resources. As I said, we welcome the addition to the msdi world in this and expect to join the p****. Russell following, their semi annual review of September. In terms of Fleet, we need this summer, we have 181 game changers in the fleet. Uh, that's an increase of 25 aircraft from June 2024. Uh they uh that will facilitate our constraint growth of 3% this year to 206 million passengers. We remain confident, the 29 remaining delayed game changers, in our 210 order book will deliver well ahead of a summer, 26.
Unknown Executive: Still a good number and a good performance. The Q1 highlights include traffic grew 4% to 58 million.
Unknown Executive: As you know, our traffic growth is being constrained by Boeing's delivery delays. Revenue per passenger rose 15%. Average fares were up an artificial 21% in that quarter. Ancillary revenues up 3% on top of 4% traffic growth. The number I'm most pleased with is unit cost control. The unit cost inflation was up just 1%. The cost gap between us and all our other EU competitors has widened materially during Q1. We took delivery of five game changers in Q1, bringing the total game changer fleet to 181 aircraft at the end of June. This summer, we're operating over 160 new routes.
Speaker Change: Cost control across the group helped to offset increased ATC charges and higher and viral car.
Speaker Change: Some are 25 travel remain demand is strong the Q2 fare increases will be lower than the exceptional Q1 increases if you remember in Q2 last year fares fell by 7%, but we now expect to recover almost all of this 7% fare decline in this year's Q2, and I think that will be much more of a.
Uh, we take heart from Boeing's, uh, recent confirmation, they expect the max aircraft, the max 7, max tend to be certified in late 2025, which would put us on, uh, a well, on course, for on-time. Contractual deliveries of our first 15, Max 10 in the spring of 2027. In fact, Stephanie Pope wrote to me last week confirming those for for 15 to deliver her confidence in those first 15 deliveries in the spring of 27, which we think is good news.
Speaker Change: A read across the full year, rather than the 21% fair increased in Q1 AD.
Speaker Change: The final H one outcome is however heavily dependent on the strength of close in bookings for the remainder of edge.
Unknown Executive: opportunistically 30 spare LEAP 1B engines from CFM. We got a negotiated significant discount on that engine order and therefore it's a judicious use of our money in order to protect resilience as the fleet of game changers arrives to 181 aircraft and we were very pleased that Ryanair were added to the MSCI world index in June, expect to be added to the FTSE Russell in September. Just turning, I won't dwell too much on these numbers, I think they speak for themselves, but again I wanted to stress again Q1 fares substantially benefited from having a full Easter holiday in April, weak prior year comparison and marginally stronger than expected close in bookings.
Speaker Change: Two visibility with 46% of our seats sold for the second half of the year and our prior year comps normalize.
Speaker Change: At last year's modest delivery delay compensation, we got from Boeing in the second half of the year will also roll off this year. So the second half will be a bit more challenging.
Overall, the trend we've been highlighting over the last year or 2 which is uh, severely constrained European shortall capacity. Uh, will continue I think for the next 5 years out to 2030, principally driven by the 2 big uh manufacturers Boeing and Airbus remaining well behind on their aircraft deliveries. Uh, many of Airbus Europe's Airbus operators, working through their path with the engine repairs and EU Airline consolidation continuing these industry capacity, constraints combined with Ryan, Air's ever widening unit cost Advantage, our strong balance sheet, our low cost aircraft orders and industry-leading Ops resilience will we believe facilitate Reiner's controlled profitable growth to 300 million, passengers by FY 2034.
And I would just want to touch briefly on the Outlook.
Speaker Change: It therefore remains too early to provide meaningful full year.
Speaker Change: <unk> guidance, we do however, cautiously expect now to recover almost all of last year's 7% full year fair decline.
Speaker Change: This should lead to a reasonable net profit growth in FY 'twenty six given our continuing exit unit cost control. The final FY 'twenty six outcome will remain heavily exposed to adverse external developments, including the risk of terrorism Terra.
Unknown Executive: Operating costs rose 1% per passenger as our jet fuel hedging largely offset a significant ATC fees increase and higher and indefensible environmental costs as ETS allowances unwind and SAF mandates impact. However, we're well hedged for the next two years with FY26 almost 85% hedged at $76 a barrel and we now have 36% of FY27 hedged at just under $66 a barrel at 13% savings.
As you see on our numbers, this morning FY 26, traffic remains on track to grow. Just 3% to 206 million passengers. This is due to heavily delayed Boeing deliveries, we expect very modest unit cost inflation FY. 26, as the delivery of more game changer aircraft, our advantageous fuel hedging and effective cost control across the group has to offset increased ATC charges and higher environmental costs.
Speaker Change: Tariff wars macroeconomic shocks, including contract escalation in the Middle East and Ukraine and of course European ATC strikes mismanagement short staffing, which continued to <unk> our operations.
Speaker Change: With that I'll turn it over Neil do you want to highlight heading in your MD&A before we open up to Q&A.
Neil: I'll, probably just to emphasize a couple of points that you made there on the balance sheet says is a standout.
Unknown Executive: The balance sheet remains strong, at the end of the quarter net cash was up at 2 billion euros, leaving us well positioned to repay the two large bonds we have over the next 10 months, including an 850 million bond repayment due in September and 1.2 billion in May of next year, which we now expect to repay from our healthy internal cash resources. As I said, we welcome the addition to the MSCI world index and expect to join the FTSE Russell following their semi-annual review in September. In terms of fleet, this summer we have 181 game changers in the fleet.
With strong liquidity in the face of unencumbered as you said that places us very strongly now to repay those bonds simple 1 billion bonds over the next two years. So I think we're in good position there very pleased with their performance on costs.
Neil: Up 1% on a per passenger basis in the first quarter. So again very much on track for modest unit cost inflation for the full year somewhere between one and 3% on an annualized base, depending on where spot fuel goes and what the final schedule looks like over the balance of the year ancillary strong performance of <unk>.
While summer, 25 travel remained, demand is strong, the Q2 fare increases will be lower than the exceptional q1 increases. If you remember in Q2 last year, first fell by uh 7%. But we now expect to recover almost all of this 7%, Fair decline in this year's Q2, I think that'll be much, more of a, read across the full year, rather than the 21% fare increase in q1. Uh, the final here, H1 outcome is however, heavily dependent on the strength of close in bookings. For the remainder of July, August and September, as is normally, at this time of the year, we have zero H2 visibility. We've only 6% of our seats sold for the second half of the year and our prior year comps normalized. Uh, and last year's modest delivery delay compensation. We got from Bowing in the second half of the year. We'll also roll off this year so the second half will be a bit more challenging
Unknown Executive: That's an increase of 25 aircraft from June 2024. That will facilitate our constrained growth of 3% this year to 206 million passengers. We remain confident the 29 remaining delayed game changers in our 210 order book will deliver well ahead of summer 26.
Neil: 8% on a passenger basis, there was some Easter benefit in there. So again no change to the guidance of one 2% increase in ancillary so over the course of the year and then traffic in Q2, we're probably looking at traffic coming in just under 61.
It's there for me too early to provide meaningful full year Pat guidance, we do however cautiously expect now to recover, almost all of last year's 7% full year, Fair Decline and this should lead to a reasonable net profit growth in FY 26, given our continuing, excellent unit, cost control.
Unknown Executive: And we take heart from Boeing's recent confirmation they expect the Max... deliveries of our first 15 Mach 10 in the spring of 2027. In fact, Stephanie Pope wrote to me last week confirming her confidence in those first 15 deliveries in the spring of 2027, which we think is good news.
Neil: And in good shape on a solid set of numbers in Q1.
Neil: Michael and I would like to ask Eddie Wilson gives you cover your current view on current trading as the CEO of DAC current trading into the second quarter of the year, Please and I'll just ask Julius give.
The final fee 26 outcome will remain heavily exposed though, to adverse external developments, including the risk of terrorism. Uh tariff Wars macroeconomic shocks, including conflict escalation in the Middle East, and Ukraine and of course, uh, European ATC strikes mismanagement and short staffing, which continued to be devil our operations. Uh, with that. I'll turn over Neil. Do you want to highlight anything in your mdna? Before we open up to Q&A?
Speaker Change: I'll probably just emphasize a
Neil: Give us a comment on the legal regulatory environment before we open up to Q&A, Ed Sorry, Eddie go ahead.
Unknown Executive: Overall, the trend we've been highlighting over the last year or two, which is severely constrained European short haul capacity will continue, I think, for the next five years out to 2030, principally driven by the two big manufacturers, Boeing and Airbus, remaining well behind on their aircraft deliveries. Many of Airbus, Europe's Airbus operators working through their Pratt & Whitney engine repairs and EU airline consolidation continuing. These industry capacity constraints combined with Ryanair's ever-widening unit cost advantage, our strong balance sheet, our low-cost aircraft orders and industry-leading ops resilience will, we believe, facilitate Ryanair's controlled profitable growth to 300 million passengers by FY2034.
Neil: Yeah.
Neil: Q2, I mean that can serve as a robust I mean.
Neil: Most all across the piece there.
Neil: We put extra.
Neil: We've been growing strongly in those markets, where we're getting a according taxes and growing aggressively in regional Italy also Sweden into Hungary.
These on encumbered. Uh as you said that places is very strongly. Now to repay those bonds the the 2.1 billion bonds over the next 2 years. So I think we're in good position there. Very pleased with the performance on costs.
Neil: And you'll see there's a lot of the regions in particularly in Spain, France and also in the U K are under serious pressure because of uncompetitive cost. So we will and it's it's it's it's it's robust fare environment pretty much across the piece.
Unknown Executive: And I would just want to touch briefly on the outlook. As you see in our numbers this morning, FY26 traffic remains on track to grow just 3% to 206 million passengers. This is due to heavily delayed Boeing deliveries. We expect very modest unit cost inflation FY26 as the delivery of more game-changer aircraft, our advantageous fuel hedging and effective cost control across the group helps to offset increased ATC charges and higher environmental costs. While summer 25 travel demand is strong, the Q2 fare increases will be lower than the exceptional Q1 increases. If you remember in Q2 last year, fares fell by 7%, but we now expect to recover almost all of this 7% fare decline in this year's Q2.
Speaker Change: Good and Juliet and he'd like to raise on the regulatory side. Thanks, Michael just maybe on the package. So everyone is familiar with the Big case, we have in Spain in relation to cabin baggage and positive decision a few weeks ago, where the court suspended the enforceability of part of that decision.
Neil: Also the payment of the big Pine.
Uh, up 1% on a per passenger basis, uh, in the first quarter. So, again very much on track uh, from all the students cost inflation for the full year somewhere between 1 and 3 basis depending on where spot fuel goes uh and what the final schedule looks like over the balance of the year. Uh, and filler is strong performance of 3% on a passenger basis. There was some Easter benefits in there. So again, no change to the guidance of 1 to 2% increase in ancillaries, over the course of the year and then traffic into Q2. We're probably looking at traffic coming in just under 61 million passengers. So about 2% uh growth in traffic there. 3% on a full year basis to 206, uh million. So the the business is in good in, good shape. Um, and a solid set of numbers in q1.
Speaker Change: We discussed.
Speaker Change: Last call hopefully also there are discussions ongoing in Brussels about.
Speaker Change: Potentially regulating the minimum size of cabin baggage and ste.
Speaker Change: The dimensions that are being discussed are smaller than what we currently allow so up would obviously be helpful.
Thank you, Michael. And Eddie Wilson, give us a call, your current view on current trading as a CEO of DAC. Uh, current trading into the second quarter of the year. Uh, please then I just asked Julius. Uh give us a comment on the legal regulatory environment before we open up to Q&A uh uh sorry Eddie. Go ahead.
Speaker Change: Slow progress in Brussels in terms of overflights.
Unknown Executive: I think that will be much more of a read across the full year rather than the 21% fare increase in Q1.
And we would like to see more done on that front.
Speaker Change: A lot of talk about competitiveness on the back of the drug you report in the European Parliament and the European Council.
Unknown Executive: The final H1 outcome is however heavily dependent on the strength of close-in bookings for the remainder of July.
Speaker Change: In that respect.
Unknown Executive: to visibility. We've only 6% of our seats sold for the second half of the year, and our prior year comps normalised, and last year's modest delivery delay compensation we got from Boeing in the second half of the year will also roll off this year, so the second half will be a bit more challenging.
Speaker Change: Thanks, Judy just before I open up that would drive retention it might help to shorten some of the questions. We have seen in recent weeks some of our competitors reporting.
Speaker Change: Slightly.
Speaker Change: Core outlook through the summer price sensitivity on traffic challenging prior year comps I think they were on the opposite of our Oh.
Yeah, um, the uh, Q2, I mean like fairs are are robust. I mean, almost all all across the the piece there. Uh, we put extra, uh, we've been growing strongly in those markets where, uh, where we've been getting a, uh, a cut in taxes and growing aggressively in Regional Italy also into Sweden into Hungary and, uh, you'll see that a lot of the, uh, regions in, uh, particularly in in, uh, Spain France and also in the UK are under serious pressure because of uncompetitive costs. So we will, um, it's it's, it's, um, it's it's, it's, it's robust for environment like pretty much across the east.
Unknown Executive: It therefore remains too early to provide meaningful full-year PAT guidance. We do, however, cautiously expect now to recover almost all of last year's 7% full-year fare decline, and this should lead to a reasonable net profit growth in FY26, given our continuing excellent unit cost control. The final FY26 outcome will remain heavily exposed, though, to adverse external developments, including the risk of terrorism, tariff wars, macroeconomic shocks, including conflict escalation in the costs, up 1% on a per-passenger basis in the first quarter, so again, very much on track for modest unit cost inflation for the full year, somewhere between 1% and 3% on an annualised basis, depending on where spot fuel goes and what the final schedule looks like over the balance of the year.
Speaker Change: The Ot a boycott this time last year, we were in the teeth of the Otas boy cost at it.
Speaker Change: It appears that some of the Otas, we're moving some of that traffic across to our competitor Airlines all the most of which the tour operators to re inject too as a result this year of having now are resolved with our approved oti's transactions, we're seeing the reverse of that so while our competitors have tough prior year comps because they benefited from our <unk>.
Speaker Change: Steve last year this year, they have challenging prior year comps and a tougher outlook on the environment. We are on the reverse of that unusually for Ryan here, we are weak prior year comps through the first and second quarters last year, we are seeing robust demand into the summer of this year at traffic.
Good and Julius and you'd like to raise on the regulatory side. Thanks Michael. Just maybe on the baggage. So everyone is familiar with the big case. We have in Spain in relation to cabin baggage and a positive decision. A few weeks ago, where the court suspended in, for stability of that of that decision. And also the payment of the big fine, uh, that we discussed in, in the last call helpfully. Also, there are discussions ongoing in Brussels about, um, potentially regulating the minimum size of cabin baggage, and the, uh, Dimensions that are being discussed are smaller than what we currently allow. So that would obviously be helpful um slow progress in Brussels in terms of overflights, um and we would like to see more done on
Speaker Change: Asia modestly ahead, as we would expected one or 2% upon themed AD day last year, but the pricing is.
Speaker Change: Is reasonably strong.
Speaker Change: At the full year, we thought we would recover most but not all of the 7% fair declined last year, we've upgraded that slightly or modestly. This morning, we now expect to recover almost all of last year's 7% decline and that is because I think well one we have the two half of Easter in April and two we.
Conduct front. Uh, a lot of talk about competitiveness on the back of the draggy report in the European Parliament and in the European Council, but very little actual action. So, uh, we need we, we need to see more, uh, uh, in that respect.
Speaker Change: Fixed the approved <unk>, we're seeing those stronger forward bookings holiday bookings coming through to us in the first half of the year something I believe we had lost site tour operators some of our airline competitors last year. So we are on the inverse of what our competitors to.
Unknown Executive: Ancillaries, strong performance, up 3% on a passenger basis. There was some Easter benefit in there, so again, no change to the guidance of 1% to in good shape, and a solid set of numbers in Q1.
Speaker Change: To some degree complaining about in recent weeks.
Speaker Change: Okay with that 90, if you'd open up to Q&A and keep everybody to no more than two questions. Please.
Speaker Change: Of course, if you would like to ask a question you may be hit by pressing star followed by one on your telephone keypad.
Speaker Change: Please press star followed by <unk>.
Speaker Change: On the Pan to ask a question. Please ensure your line is painful.
Speaker Change: Please limit yourselves to take questions.
Edward Wilson: And I'd like to ask Eddie Wilson, give us a cover of your current view on current trading as a CEO of DAC, current trading into the second quarter of the year.
Speaker Change: Our first question guys, Hey, Stephen furlong of Stephens. Please go ahead Steven.
Speaker Change: Okay, thanks Judith. Just before I open up, I would draw everybody's attention. It might help to shorten some of the questions. Uh, we've seen in recent weeks. Some of our competitors reporting, uh, you know slightly, uh, poor Outlook through the summer price, sensitivity on traffic, uh, challenging prior to your comps. I think they were on the opposite of our, uh, oh, uh, otaa boycott this time. Last year, we were in the teeth of the otaa boycott it. Now appears that some of the OTAs were moving some of that traffic across to our competitor Airlines or the most had went to the tour, operators to enjet to uh as a result this year of having. Now a resolved that with our approved ot8 transactions, we're seeing the reverse of that. So while our competitors have tough prior year comps because they benefited from our OT dispute last year this year, they have challenging prior to your comps and a tougher outlook on the environment. We're on the reverse of that unusually for around here, we have week prior year comp through the first and second
Speaker Change: Yes, Hi, Michael Okay. Two questions, maybe one for you Michael that number one for Neil.
Unknown Executive: Please, then I'd just ask Julius, give us some comments on the legal regulatory environment before we open up the Q&A. Sorry, Eddie, go ahead. Yeah, the Q2, I mean, like, fares are robust. I mean, almost all across the piece there, we put extra, we've been growing strongly in those markets where we're getting a cut in taxes and growing aggressively in regional Italy, also in Sweden, into Hungary.
Speaker Change: I mean, it's speculation, but retiree thing will play out I saw there in the paper today Embraer were saying that it.
Speaker Change: I might add 9 million for the price of Jackson and their U S customer base.
Speaker Change: Won't pay us and therefore, they would almost have to slow or stop production and then for Neil I was just wondering at what is needed for you to look at locking in this attractive dollar race on the future aircraft deliveries given that will be a significant damage.
Edward Wilson: And you'll see that a lot of the regions in, particularly in Spain, France, and also in the UK are under serious pressure because of uncompetitive costs. So we will, it's robust for our environment, like pretty much across. Good.
Speaker Change: On the capital side for a longer term on depreciation et cetera. Thanks a lot.
Speaker Change: Thanks, Steven Okay quick answer on the tariffs nobody knows.
Speaker Change: What we suspect will happen is I think Trump will continue to probably delay the imposition of tariffs from the first of August into maybe September October until a trade deal is agreed with the Europeans and there's increasing optimism in Turkey in Washington that commercial aircraft aircraft leasing will be exempt from U S. Tariffs there is a.
Here. So we're on the inverse of what our competitors were to some degree complaining about in recent weeks.
Juliusz Komorek: And Julius, any you'd like to raise on the regulatory side? Thanks, Michael. Just maybe on the baggage. So everyone is familiar with the big case we have in Spain in relation to cabin baggage and a positive decision a few weeks ago where the court suspended the enforceability of that decision and also the payment of the big fine that we discussed in the last call. Helpfully, also, there are discussions ongoing in Brussels about potentially regulating the minimum size of cabin baggage. And the dimensions that are being discussed are smaller than what we currently allow. So that would obviously be helpful.
Speaker Change: Knotty. If you open up to Q&A and keep everybody to know more than 2 questions, please,
Of course, if you would like to ask a question, you may do. So by pressing star, followed by 1 on your telephone keypad. Now, if you do change your mind, please press star followed by 2.
Speaker Change: Risk, though that the EU Europeans are going to looking at.
Speaker Change: Reciprocate tariffs, which might target pharma and commercial aircraft that would be as damaging to Airbus as exports into North America, particularly on the long haul aircraft side as it would be to Boeing who don't have that many deliveries into Europe, but nevertheless, so I think the risk is reciprocal tariffs.
Speaker Change: When my parent to ask your question please ensure your line is a muted locally please email yourselves to 2 questions.
Our first question goes to Stephen Furlong of Davey Steven. Please go ahead Stephen. Hi
Speaker Change: I think it's unlikely but.
Speaker Change: In our agreements with Boeing Boeing.
Yeah. Hi Michael. Uh, okay. 2 questions. Um, maybe 1 for you Michael and 1 for Neil. Um, how do you think? I mean it's speculation. But, uh, the Tariff thing will play out. I saw there in the paper today. Embrio were saying that
Juliusz Komorek: Slow progress in Brussels in terms of overflights. And we would like to see more done on that front. A lot of talk about competitiveness on the back of the Draghi report in the European Parliament and in the European Council. in that respect.
Speaker Change: Our liable for the tariffs not Ryan Air we have fixed pricing on our aircraft that Boeing we would however want to work with Boeing.
my dad had 9 million for the price of jets and and their their Us customer base.
Speaker Change: August September October we don't actually need those aircraft until summer of 2026, So we might be working together with Boeing delayed some of some or all of those deliveries, while the Americans and Europeans are resolved any tariff dispute.
Won't pay it and therefore they'd almost have to slow or stop production. And then from Neil, I was just wondering, you know what? What is needed for you to look at locking in this attractive?
Unknown Executive: Okay, thanks Julius. Just before I open up, I would draw everybody's attention, it might help to shorten some of the questions. We've seen in recent weeks some of our competitors reporting, you know, slightly poor outlook through the summer, price sensitivity on traffic, challenging prior year comps. I think they were on the opposite of our OTA boycott. This time last year we were in the teeth of the OTA boycott. It now appears that some of the OTAs were moving some of that traffic across to our competitor airlines, although most of it went to the tour operators, TUI and Jet2.
Dollar rate on on the future aircraft deliveries given. That would be a significant benefit on the on the capital side for a longer term on the precise and Etc. Thanks a lot.
Speaker Change: Secondly, there is a possibility we could take some of those aircraft onto the U K Register where we have Ryan Air UK and Theres no tariffs on commercial aircraft between the Europe and the U K U S. Trade agreement. So I think tariffs are unlikely to the extent that they are imposed I think they are likely to be short lived.
Speaker Change: And while Boeing are liable for the tariffs we would work with Boeing I think guided by delaying deliveries are perhaps looking at taking some deliveries through the U K at which would be a way of allowing Boeing to deliver aircraft to the right hander group without attracting tariffs from the state and Neil maybe you won't talk about the Dol.
Unknown Executive: As a result this year of having now resolved that with our approved OTA transactions, we're seeing the reverse of that. So while our competitors have tough prior year comps because they benefited from our OTA dispute last year, this year they have challenging prior year comps and a tougher outlook on the environment. We're on the reverse of that. Unusually for Ryanair, we have weak prior year comps through the first and second quarters last year. We are seeing robust demand into the summer of this year. Traffic is modestly ahead as we would expect, at one or two percent up on same day last year, but the pricing is reasonably strong.
Speaker Change: <unk> locking of the dollar on our aircraft orders that might get Crazy Mccann here is whether to add some commentary to that.
Thanks Stephen. Okay, quick answer on the tariffs, nobody knows uh what we suspect will happen is I think Trump will continue to probably delay. The imposition of tariffs on the 1st of August into, maybe September October until a trade deal, is agreed with the Europeans and there's increasing optimism in certainly in Washington that commercial aircraft aircraft leasing will be exempt from us tariffs. There is a risk though. That the EU Europeans are going to looking at, uh, reciprocal tariffs, which might Target Pharma and Commercial aircraft. That would be as damaging to airbuses exports into North America, particularly on the Long Haul aircraft side as it would be to Boeing who don't have that many, uh, deliveries into Europe. But nevertheless, so, I think the risk is reciprocal tariff.
Neil: Sure Stephen Thanks, very much yeah. The eurodollars. So that's obviously moved very much.
Neil: In the direction that we would like in relationship to locking in the Capex on the Max 10.
Neil: One blocker is whether we will get hedge accounting or not.
Neil: So the number you asked what we need to do we probably need to get some clarity.
Neil: Our auditors as to what they will need to see before they are happy that we can get hedge accounting, whether that sort of expectation of tens or whether it's the greater surface that were getting from Boeing got to go deliver on time, but we've seen the dollar moved from probably somewhere around 105 106, when we placed at the <unk>.
Unknown Executive: On the full year, we thought we would recover most but not all of the seven percent fair decline last year. We've upgraded that slightly or modestly this morning. We now expect to recover almost all of last year's seven percent decline and that is because, I think, well one, we have the two halves of Easter in April and two, we've fixed the approved OTA and we're seeing those stronger forward bookings, holiday bookings, coming through to us in the first half of the year, something I we had lost to our operators and some of our airline competitors last year.
Neil: Order back in May 2023 to somewhere likely a 120, if we if we were able to do something on it so we'd like to like to hedge but won't do it unless we get the hedge accounting.
Uh, I think it's unlikely but, you know, uh, in our agreements with Boeing Boeing, uh, our liable for the tariffs. Not right. In, are we have fixed price agreements on our aircraft? That Boeing? We would, however, want to work with Boeing, though, to minimize the imposition of tariffs. And we have a number of things we could do. 1, we could delay the deliveries through August September, October. We don't actually need those aircraft until summer of 2026. So we might working together with Boeing delays. Some of the, some are all of those deliveries while the Americans and the Europeans, uh, resolve any tariff, dispute, uh, secondly, there's a possibility. We could take some of those aircraft on to the UK register, where we have Reiner UK, and there's no tariffs on Commercial aircraft between the, in the
Neil: It's important because we don't want the volatility on the noise on the P&L.
Unknown Executive: So we're on the inverse of what our competitors were, to some degree, complaining about in recent weeks.
Neil: Tracy.
Unknown Executive: Okay, with that, Nadia, if you'd open up to Q&A and keep everybody to no more than two questions, please. Of course, if you would like to ask a question, you may do so by pressing star followed by one on your telephone keypad. Please press star followed by two. When preparing to ask your question, please ensure your line is unmuted locally. Please limit yourselves to two questions.
Tracy: And so where we have opportunities and we can do anything knock on the dollar on the like the maintenance leasing engine with <unk>.
Neil: Hum.
Steve: Good well done thanks, Steve next question. Please.
Speaker Change: The next question Gucci, Jamie Rowbotham of Deutsche Bank, Jamie. Please go ahead Jamie.
Jamie Rowbotham: Hi, Michael and two for me just coming back on the cabin bags Julien mentioned, the good news out of Spain, but not the bad news from Brussels, Mep's voted in favor of legislation preventing you from <unk>.
Europe and the UK US trade agreements. So I think tariffs are unlikely to the extent that they're imposed. I think they're likely to be short-lived. And while Boeing are liable, for the tariffs we would work with Boeing, I think either by delaying deliveries or perhaps looking at taking some deliveries through uh the UK which will be a way of uh allowing bowing to deliver aircraft to the Reiner group uh without attracting tariffs from the uh the states uh Neil maybe you want to talk about the dollar locking in the Dollar on our aircraft or if they might get Tracy McCann here as well, then to add some commentary to that.
Stephen Furlong: Our first question goes to Stephen Furlong of Davie. Stephen, please go ahead.
Unknown Executive: Stephen, hi. Yeah, hi, Michael. Okay, two questions. Maybe one for you, Michael, and one for Neil. How do you think, I mean, it's speculation, but the tariff thing will play out? I saw there in the paper today, Embraer were saying that might add 9 million for the price of Jetson and their US customer base. won't pay it and therefore they'd almost have to slow or stop production.
Jamie Rowbotham: Hence you charging extra for hand, luggage, so where do you think we'll get to on this will prevail when it comes to the ability to charge separately.
Jamie Rowbotham: Second one we know where youre at and capacity for Sweden, Hungary regionally, Italy, Poland. Just one that has there been any reaction from airports or countries, where you have been reducing capacity like in Spain have any incentives been offered.
Sure, Stephen. Thanks very much. Uh, yeah. The the Euro dollars is is obviously moved very much uh in the direction that we would like in relation to to locking in the capex on the max 10. Uh, the 1 blocker is whether we'll get hedge accounting or not. Um, so there's a number, you asked what we need to do? We probably need to, to get some clarity, uh, with our Auditors as to, to what uh, they will need to see before they're happy, uh, that we can.
Unknown Executive: And then from Neil, I was just wondering, you know, what is needed for you to look at locking in this attractive dollar race on the future aircraft deliveries, given that would be a significant benefit on the capital side for a longer term on the pre-session, etc. Thanks a lot. Thanks, Stephen.
Speaker Change: Ah, Okay, sorry, where coke capacity.
Jamie Rowbotham: Non banks.
Jamie Rowbotham: Suggestion from the Parliament.
Jamie Rowbotham: Legal status is part of the part of a discussion with the commission on the revised rules. Firstly, the first idea of the boundaries that everybody's entitled to bring two three bags onboard as an implementable. They don't fit in the aircrafts there isn't room on largely full aircraft bar to for a small carry on one small carrier.
Hedge accounting whether that's the certification of the tens or or whether it's uh the greater certainty that we're getting from bowing that they're going to deliver on time. Um but we we've seen the dollar move from probably somewhere around 105 106. When we placed uh the the the order back into May 2023 to somewhere like the over 120, if we, if we were able to do something on it so would like to like to hedge, but won't do it unless we get the Hedge accounting. Um, that's important.
Unknown Executive: Okay, quick answer on the tariffs, nobody knows. What we suspect will happen is, I think, Trump will continue to probably delay the imposition of tariffs from the 1st of August into maybe September, October, until a trade deal is agreed with the Europeans. There's increasing optimism in, certainly in Washington, that commercial aircraft, aircraft leasing will be exempt from US tariffs. There is a risk, though, that the EU Europeans are going to looking at reciprocal tariffs, which might target pharma and commercial aircraft. That would be as damaging to Airbus's exports into North America, particularly on the long-haul aircraft side, as it would be to Boeing, who don't have that many deliveries into Europe.
Speaker Change: Because we don't want the volatility in the noise on the p&l.
Jamie Rowbotham: <unk> got more large trolley bag.
Jamie Rowbotham: We can feed about 50% of the passenger can bring a trolley bag and we use that using the.
Tracy. Yeah, it just added that we are looking at other stuff, so not just faircraft Stevens, so where we have opportunities, and we can do anything lock in the dollar and the likes of Maintenance, or this recent engine deals, we have done. So
Jamie Rowbotham: Priority boarding service.
Speaker Change: Good. Well done. Thanks Stephen. Next question, please.
Jamie Rowbotham: Any rule that would at all to that would be infringing, our EU rules or regulations.
The next question. Goes to Jamie rabo of Duty Bank. Jamie. Please go ahead. Jamie. Hi.
Jamie Rowbotham: Our regulation was serious.
Jamie Rowbotham: So a Tuesday, Arizona, which guarantees freedom of airline to set pricing and policies and we don't believe that that will happen. So I think it is unlikely to play out, but theres clearly going to be some kind of negotiation between the parliament and the commission on passenger right.
Unknown Executive: But nevertheless, so I think the risk is reciprocal tariffs. I think it's unlikely, but you know, in our agreements with Boeing, Boeing are liable for the tariffs, not Ryanair. We have fixed price agreements on our aircraft with Boeing. We would, however, want to work with Boeing, though, to make sure that we can get a deal done. August, September, October, we don't actually need those aircraft until summer of 2026. So we might, working together with Boeing, delay some or all of those deliveries while the Americans and the Europeans resolve any tariff dispute. Secondly, there's a possibility we could take some of those aircraft on to the UK register where we have Ryanair UK, and there's no tariffs on commercial aircraft between the Europe and the UK US trade agreement.
Jamie Rowbotham: We're supported though of the commission's proposal to define.
Jamie Rowbotham: Centimeters.
Jamie Rowbotham: We allow a 40 by 30 by 20 centimeters, which is quite substantial bag that fits under the seat anyway and that will we think undermine our exposed illegality of minister Boston noise Mad cap Bank fines, which were imposed only envelope airlines in Spain, and we would like to see that put behind us, but there will always be some.
MEP voted in favor of legislation preventing you from potentially charging extra for hand luggage. So, where do you think we'll get to on this? We'll we'll sense Prevail when it comes to the ability to charge separately. Um, second 1 we know where you're adding capacity. So Sweden, Hungary Regional Italy, Poland, I just wondered. Has there been any reaction from airports or countries where you've been reducing capacity? Like in Spain have any incentives been offered. Thanks.
Speaker Change: Pension and debate between the Parliament and the commission on passenger rights.
Speaker Change: The apartment was doing its job it would be but being getting much more aggressive about protecting overplayed during ATC strikes and rolling back bogus and by our own fair environmental taxes on intra EU air travel, while we exempt the most losing long haul flights to and from the EU, but the Parliament has always been at home for.
Unknown Executive: So I think tariffs are unlikely. To the extent that they're imposed, I think they're likely to be short lived. And while Boeing are liable for the tariffs, we would work with Boeing, I think either by delaying deliveries or perhaps looking at taking some deliveries through the UK, which would be a way of allowing Boeing to deliver aircraft to the Ryanair group without attracting tariffs from the state.
Speaker Change: Crazies, and therefore less than intelligent kind of suggestions coming out there is to be expected.
On airport and countries, where there are countries on.
Speaker Change: Who are where we're cutting capacity, Germany as the most notable example.
Speaker Change: There have no aviation policy whatsoever, Germany is the least recovered.
Neil Sorahan: Neil, maybe you want to talk about the dollar, locking in the dollar on our aircraft orders. I might get Tracy McCann here as well then to add some commentary to that. Sure, Stephen. Thanks very much. Yeah, the euro dollars, it's obviously moved very much in the direction that we would like in relation to locking in the capex on the max 10. The one blocker is whether we'll get hedge accounting or not. So the number you asked what we need to do, we probably need to get some clarity with our auditors as to what they will need to see before they're happy that we can get hedge accounting, whether that's the certification of the 10s or whether it's the greater certainty that we're getting from Boeing that they're going to deliver on time.
Speaker Change: Our country post COVID-19, they're operating at about 83% of their pre COVID-19 capacity and still declining it has gone down from 85% last year to 83%. This year. We have moved capacity. They expect airports are where they are increasing fees like Berlin, we closed the base and Frankfurt main we have reallocated all had capacity to those countries in <unk>.
Uh, okay, anywhere cut capacity, um, come back, the suggestion from the parliament is no legal status. It's part of the parliament discussion with the commission on, uh, revised rules. Uh, firstly, the, the, the, the first idea out of the problem is that everybody's entitled to bring 2 free bags on board is unimplemented. They, they don't fit in the aircraft. There isn't room on largely full, aircraft for 2, small carry on for for once more, carry on bag and 1 large poly bag. We uh, can fit about 50% of the passengers, can bring a trolley bag and we use that using the uh, priority boarding service, uh, any rule. That would also, that would be infringing uh, EU rules or regulation 1 08208, which guarantees, the freedom of airline to set pricing and policies. And we don't believe that will happen. So I think it is unlikely to play out, but they're clearly going to be some kind of negotiation between the Parliament and the commission on passenger rights.
Speaker Change: Regions, where they're abolishing environmental taxes and coming up with much more.
Speaker Change: Competitive airport fees, we recently reversed for example, three years of capacity costs at Warsaw Modlin Airport.
Speaker Change: I was out there and more so two weeks ago, where we announced a five year growth deal, where we would travel or traffic and more so modeling on the back of a newly signed six year growth agreement agreed that the airports. So theres lots of that kind of capacity growth available to us Dublin is continues to be a disappointment.
Unknown Executive: But we've seen the dollar move from probably somewhere around 105, 106 when we placed the order back into May 2023 to somewhere likely over 120 if we're able to do something on it. So we'd like to hedge but won't do it unless we get the hedge accounting. That's important because we don't want the volatility and the noise on the P&L.
Unknown Executive: and Tracy. Stephen, so where we have opportunities and we can do anything, lock in the dollar on the likes of maintenance or this recent engine deal, we have done so. Good. Well done. Thanks, Stephen.
We're supported though of the commission's proposal to Define what 1 free carry-on bag should be. It's quite a large bag at 40 by 30 by 15. Cm, we allow 40 by 30 by 20 cm, which is quite substantial bag that fits under the seat anyway, and that will we think undermine uh, or expose the illegality of Minister Bus ando's mad cap bag finds uh, which were imposed only on the low fare Airlines in Spain. And we would like to see that put behind us, but there will always be some tension and debate. I think between the Parliament and the commission on passenger rights, uh, if Department was doing its job, it would be being getting much more aggressive about protecting overflights during ATC strikes and rolling back, uh, bogus and our own, uh, Fair environmental taxes on intra-eu air travel while we exempt the most polluting long hole flights to, and from the EU. But the parliament has always been a home for crazies and therefore less than intelligent.
Speaker Change: Remember last year added government program published in January promise, they with scrap the artificial and illegal cap at Dublin Airport quote as soon as possible and Kohl's seven months later they are all about to go on three months.
Speaker Change: kind of suggestions coming out there is to be expected on airports and countries where, you know, there are countries, uh, on the, uh,
Speaker Change: Of holidays, and nothing has been drawn at the scrap is cap, which is indefensible. When a government that has a <unk> majority in our five years away from the next election, but Goldman to Irish government inaction.
Jaime Rowbotham: The next question goes to Jaime Rowbotham of Deutsche Bank. Jaime, please go ahead. Jaime, hi.
Unknown Executive: Hi Michael, two from me, just coming back on the cabin bags, Juliusz mentioned the good news out of Spain but not the bad news from Brussels that the MEP voted in favour of legislation preventing you from potentially charging extra for hand luggage, so where do you think we'll get to on this, will Centre prevail when it comes to the ability to charge separately? Second one, we know where you're adding capacity, so Sweden, Hungary, regional Italy, Poland, I just wondered, has there been any reaction from airports or countries where you've been reducing capacity, like in Spain, have any incentives been offered?
Speaker Change: It continues to be table, our growth we submitted a plan to the previous government offering to grow from 20 million 30 million passengers over the next five years to 2000, and Turkey, where the only airline that could do that with low cost fuel efficient annoy quieter aircraft and yet. Despite the fact that we have paid for the infrastructure of a second runway of Tilda and therefore.
Who are? Uh, we're we're cutting capacity. Germany is the most notable example. Uh, where there have no Aviation policy whatsoever. Germany is the least recovered uh state or country postco. They're operating here about 83% of their preco capacity and still declining. It's gone down from 85% last year to 83% this year. We have moved
Speaker Change: We now have not one but two caps theres, a 2007 road traffic cap limiting 30 to 32 made and last week the local council.
Speaker Change: <unk> appeal board came up with another madcap limousine. The total number of movements arbitrarily 35 million face a year, which is pretty much where we are at the mall.
Unknown Executive: Thanks. Okay, sorry, we're cut, can't pass it. Carrying on bags, the suggestion from the Parliament is no legal status. It's part of a Parliament discussion with the Commission on revised rules. Firstly, the first idea of the Parliament is that everybody's entitled to bring two, three bags on board. It's unimplementable. They don't fit in the aircraft. There isn't room on largely full aircraft for one small carry-on bag and one large trolley bag. We can fit about 50% of the passengers can bring a trolley bag and we use that using the priority boarding service. Any rule that would alter that would be infringing EU rules on Regulation 1008, which guarantees freedom of airline to set pricing and policies, and we don't believe that will happen.
Speaker Change: Both legal under EU law their countries as the freedom of movement, you can't artificially restrict the citizens EU citizens freedom of movement and Theyre, certainly contrary to the EU U S. Open skies agreements. So we believe the American Airlines will get aggressive on that though Germany in Dublin will be the two examples I would highlight to you.
Speaker Change: We're through government.
Speaker Change: Policy failure in Germany, and inexplicable government inaction in Ireland.
Good capacity out of experience, uh, where they're increasing fees like Berlin. We closed the base in Frankfort. Maine, we have reallocated a lot of capacity to those countries and regions where they're abolishing environmental taxes. And uh coming up with much more, uh, competitive airport. Uh fees, we recently reversed for example, 3 years of capacity cuts at Warsaw modeling airport. Uh, I was out there in Warsaw 2 weeks ago, where we announced a 5 year growth deal where we will travel our traffic and water so modeling on the back of a, a newly signed 6 year growth agreement agreed with the airport. So there's lots of that kind of capacity, uh, growth available to Us. Dublin is continues to be a disappointment. We opened and paid for a second runway in 2022. Uh, and through government uh failure to act. We elected a new government in November of last year. Uh the government program published in January promised, they would scrap the artificial and illegal camp at Dublin Airport, quote, as soon as possible.
Speaker Change: Can't grow.
Speaker Change: Because we can't enter outgrowing, but we are far more opportunities to grow all over Europe.
Speaker Change: At particularly at as they say in contract suite in Hungary, and reach literally where theyre abolishing taxes ADL.
Speaker Change: Anything else you want to add to that that I might ask Julia just to comment on their cabin bag regulatory situation in Europe.
Unknown Executive: So I think it is unlikely to play out, but there's clearly going to be some kind of negotiation between the Parliament and the Commission on passenger rights. We're supportive though of the Commission's proposal to define what one We allow 40 by 30 by 20 centimetres, which is quite a substantial bag that fits under the seat anyway, and that will, we think, undermine or expose the illegality of Minister Bustondoye's mad cap bag fines, which were imposed only on the low-fare airlines in Spain, and we would like to see that put behind us. But there will always be some tension and debate, I think, between the Parliament and the Commission on passenger rights.
Speaker Change: Just just quickly I suppose like I mean, it has taken some time for this message to trickle out post Covid, where we're now seeing that sort of pinch point. There is not there isn't short haul capacity to go around and while that fell on deaf ears for sometimes you can now see that playing out.
Possible end, quote, 7 months later. They're all about to go on 3 months of holidays and nothing has been done, uh, to scrap this cap, which is indefensible in a, in a government that has a 20 seat majority and our 5 years away from the next election. Uh, but government Irish government in action, uh, uh, continues to be devil our growth. We submitted a plan to the previous government offering to grow from 20 million to 30 million pastors over the next 5 years to 2030 with the only airline that could do that with low cost fuel efficient and no,
Speaker Change: Juices and they may actually have to go backwards and I think they know that there is bad news coming for French regional airports same things playing out in Spain.
Speaker Change: Whereby you know has a monopoly there.
Speaker Change: You've got the regional airports that are at 65% underutilized and that's gonna be politically on sustainable in the medium to long term.
Unknown Executive: If the Parliament was doing its job, it would be getting much more aggressive about protecting overflights during ATC strikes, and rolling back bogus and unfair environmental taxes on intra-EU air travel, while we exempt the most polluting long-haul flights to and from the EU. But the Parliament has always been a home for crazies, and therefore less than intelligent kind of suggestions coming out there is to be expected.
Speaker Change: Whereby a.
Speaker Change: Ryan Air while we're still growing in Spain at low single digits. That's at the larger airports largely at the expense of the regional airports, where we've closed a number of them airports.
Speaker Change: There's more to come this winter and on and on top of Germany. Then you can see it also playing out in the U K with a P D, which is kind of go by to quit.
Unknown Executive: On airports and countries where, you know, there are countries on the who are, we're cutting capacity. Germany is the most notable example, where they have no aviation policy whatsoever. Germany is the least recovered country post COVID. They're operating at about 83% of their pre-COVID capacity and still declining. It's gone down from 85% last year to 83% this year. We have moved capacity out of expat airports, where they're increasing fees like Berlin. We closed the base in Frankfurt, Maine. We have reallocated our capacity to those countries and regions where they're abolishing environmental taxes and coming up with much more competitive airport fees.
Speaker Change: Credit this year, and then RPI thereafter, and that's going to hit the regions, particularly badly like places like Scotland, Northern Ireland, particularly out in the regions. There, we're just not going to be able to compete.
Speaker Change: For the the incentives that are elsewhere in places like Sweden, regional Italy and Hungary.
Speaker Change: Both of those caps are illegal under EU law. Their countries is the freedom of movement, you can't artificially restrict the citizens, EU citizens, freedom of movement. And there are certainly contrary to the EU Us open Skies agreement, so we believe the American Airlines will get aggressive on that. So Germany and Dublin will be the 2, uh, examples. I would highlight to you, where, through government, uh, policy failure in Germany and inexplicable government in action in Ireland. Uh, we can't grow, uh, because we we can't or not growing, but we are far more opportunities to grow all over Europe. Um particularly as I say in countries like Sweden Hungary and Regional Italy where they're abolishing taxes Eddie anything else you want to add to that and then I might have Julius just to come in on the cabin bag regulatory situation in Europe.
Judy: And Judy if you want to add anything on the.
Judy: The parliamentary rules on target.
Judy: Passenger rights.
Judy: One thing.
Judy: Issue of carbon mortgage came up in the court of Justice in 2014, and the conclusion. There was wailing case, the boiling case and the conclusion was that the only.
Judy: Item of cabin baggage that must be free is an item that can accommodate the passengers precious and indispensable items and that the court at the time did not put dimensions on it but it is generally accepted that.
Edward Wilson: We recently reversed, for example, three years of capacity cuts at Warsaw Modlin Airport. I was out there in Warsaw two weeks ago where we announced a five-year growth deal where we would treble our traffic in Warsaw Modlin on the back of a newly signed six-year agreement agreed with the airport. There's lots of that kind of capacity growth available to us.
Judy: That fits under the seat is big enough to accommodate precious and indispensable items, but that would be your personal computer or your wallet.
Yeah, just just quickly. I suppose, like, I mean, it has taken some time for this message to trickle up postco where we're now seeing the sort of pinch point of their is not. There isn't short, hold capacity, uh, to go around. Um, and while that's still on deaf ears for sometimes, you can now see that playing out, particularly in Regional uh airports like in France, they put up the taxes and now you have the French transport Minister saying. This is a terrible thing even though he actually introduced it. And they may actually have to go backwards and I think they know that there is bad news coming for French. Uh Regional airports. Same thing is playing out in Spain, you know uh whereby a has a monopoly there and you've got the uh Regional airports that are 65% underutilized.
Judy: Medications above.
Judy: About low quarter, those kinds of things everything else that can fit in the carbon can be charged for and thats. What passengers want passengers don't want all passengers to bring a tankage you battery.
Unknown Executive: Dublin continues to be a disappointment. of last year. The government program published in January promised they would scrap the artificial and illegal cap at Dublin Airport, quote, as soon as possible, end quote. Seven months later, they're all about to go on three months of holidays and nothing has been done to scrap this cap, which is indefensible in a government that has a 20 seat majority and are five years away from the next election. But government, Irish government in action, continues to bedevil our growth. We submitted a plan to the previous government offering to grow from 20 million to 30 million passengers over the next five years to 2030.
Judy: Gates, because they know that this will delay the departure of their flight. So the policy. We're trying there currently applies on which has been copied by many airlines.
Judy: In Europe works consumers know it.
Judy: European Parliament will figure it out just in their own time.
Julie: Thank you Julie Okay next question please.
Speaker Change: And that's going to be politically unsustainable in the medium to long term, uh, whereby, uh, Reiner while we're still growing in Spain at low single digits, that's at the larger. Airports largely at the expense of the regional airports where we've closed the number, uh, of of of, um, airports and and there's more to come this winter. And and, and on top of Germany, then you can see it. Also playing out in the UK with APD, which is going to go up by 2, uh, quid this year, and then RPI thereafter. And that's going to hit the Region's particularly badly like places, like Scotland, Northern Ireland, particularly in the regions there where they're just not going to be able to compete um, for the uh the incentives that are elsewhere in places like Sweden, Regional Italy and Hungary.
Judy: Yes.
Judy: <unk> of J P. Morgan Harry Please go ahead.
Speaker Change: Yes, good morning, Michael.
Judy: Just last quarter.
Speaker Change: I placed it in pricing in Q1 and was wondering if that's something you've seen continue as a trend into Q2, so far and then second one probably one for Neil.
Unknown Executive: We're the only airline that could do that with low cost, fuel efficient and no quieter aircraft. And yet, despite the fact that we have paid for the infrastructure of a second runway at Dublin Airport, we now have not one but two caps. There's a 2007 road traffic cap limiting traffic to 32 million. And last week, the local council and the Planning Appeals Board came up with another mad cap, limiting the total number of movements arbitrarily to 35 million flights a year, which is pretty much where we are at the moment. Both are legal under EU law, they're contrary to the freedom of movement.
Speaker Change: Total unit cost per Pax plus one in Q1 of next door was plus free is that the right that we should be extrapolating across the full year or is there any reason to highlight why those numbers are ones that we shouldnt be dragging outwards.
Speaker Change: Q3, Q4, thanks a lot.
Speaker Change: Thanks, Harry I mean, let me deal with the pricing we are seeing stronger close in pricing. The load factors were running about 1% ahead of where we were at this time last year. So we have less seats to sell clothing. There's certainly we're engaged in less discounting, particularly as we move through Q1 and Q2 I think because of the approved hotelier.
And Judy, if you want to add anything on the uh, the the Parliamentary rules on baggage or passenger rights, just 1 Thing, uh, that the issue of cabin baggage came up in the EU court of justice in 2014. Oh yeah. And the conclusion there was wailing case the Wailing case. And the conclusion was that the only uh, uh, item of cabin baggage that must be free is uh, an item that can accommodate the passenger's precious and indispensable items and that uh, the court at the time did not put dimensions on it but is generally accepted that a bag that fits under the seat is big enough to accommodate pressures and indispensable items. So that would be your personal computer, your wallet, some medic.
Unknown Executive: You can't artificially restrict the citizens, the EU citizens' freedom of movement. And they're certainly contrary to the EU-US Open Skies Agreement. So we believe the American airlines will get aggressive on that.
Speaker Change: Fusion, but I would caution again average fares went up 21%.
Edward Wilson: So Germany and Dublin would be the two examples I would highlight to you where, through government policy failure in Germany and inexplicable government inaction in Ireland, we can't grow because we can't and are not growing. But we have far more opportunities to grow all over Europe, particularly, as I say, in countries like Sweden, Hungary, and regionally where they're abolishing taxes. Eddie, anything else you want to add to that?
Patients, um, a bottle of water, those kinds of things, everything else that can fit in. The cabin can be charged for and that's what passengers want passengers. Don't want all passengers to bring a 10kg back to the, uh, to the gate because they know that this will delay, the departure of their flight,
Speaker Change: In Q1, I think about two thirds of that was accounted for by Easter.
Speaker Change: Easter and the approved the Otas boy costs I think the like for like comparison of average fares in Q2 being up around 7% recovering last year, 7% fair decline is probably closer to what the underlying trend is through Q1 into Q2 and I hope that would continue into Q3 as we're seeing this morning, we.
So, the policy which Reiner currently applies and which has been copied by many airlines, uh, in Europe, Works consumers, know it and, and the European Parliament will figure it out in just in their own time.
Julius: Thank you, Julius. Okay, next question, please.
Harry goers: The next question. Go to Harry goers of JP Morgan Harry. Please. Go ahead Harry Harry.
Edward Wilson: And then I might ask Juliusz just to come in on the Camden Bank regulatory situation in Europe. Yeah, just just quickly, I suppose, like, I mean, it has taken some time for this message to trickle up post COVID where we're now seeing the sort of pinch point of there is not there isn't short haul capacity to go around. And while that fell on deaf ears for some times, you can now see that playing out.
Speaker Change: Spect to recover almost all of last year's full year, 7% fair decline.
Speaker Change: And the closing as we move into Q2 is strong but that's also fragile.
Speaker Change: Finally, we continue to be a little bit cautious on the kind of Q2 and full year guidance. If we have some a safety event terrorist event that European cities.
Speaker Change: Going toward our crazy or damaging comes out of our way.
Speaker Change: I don't see tires effective short term bookings those in fact were sitting here in a monsoon in Dublin. This morning, which is probably good for close in pricing certainly out of Dublin.
Speaker Change: Alright.
Speaker Change: <unk> bookings pricing up but thats also fragile that could fall over as we move through July.
Speaker Change: As we move through August and September into the second half of the year.
Speaker Change: Anything else you want to add on close in pricing of them will go to Neil on unit cost.
Speaker Change: No I don't think I might be a year covered comprehensively.
Juliusz Komorek: of the Wren Company And Juliusz, do you want to add anything on the Parliament rules on baggage or passenger rights? Just one thing that the issue of cabin baggage came up in the EU Court of Justice in 2014. Oh yeah. And the conclusion there was... The Bwelling case. And the conclusion was that the only item of cabin baggage that must be free is an item that can accommodate the passenger's precious and indispensable items. And that, the court at the time did not put dimensions on it, but is generally accepted that a bag that fits under the seat is big enough to accommodate precious and indispensable items. So that would be your personal computer, your wallet, medications, a bottle of water, those kinds of things.
Speaker Change: <unk> unit costs, yes.
Speaker Change: Yeah sure Hari I'm going to go back to my opening comments, where I indicated that we're we're still guiding modest unit cost inflation on a full year basis somewhere between one and trade percents, we were 1% in the first quarter, where we saw traffic grow by 4% will be slower traffic growth into Q2 and on the second half.
Speaker Change: To 3% for the full year basis, I mean, it all hinges on whether we're between say voluntary presented hinges on what happens to the spot fuel over the balance of the year it depends on what happens.
Speaker Change: The final schedule that we load where is that going to be in an H staffing in advance of next summer. So I think it's fair to just stick with that modest unit cost inflation and it'll be somewhere between one and Trey and I won't be breaking it out more than that.
Speaker Change: Okay. Thanks, Aaron Thanks Neal.
Dudley Shanley: The next question guys, Hey, Dudley Shanley Allstate body Dudley. Please go ahead.
Speaker Change: Morning, Michael two questions from me as well first of all it possibly to follow up on Harry's question little bit what to think about it more longer term.
Dudley Shanley: Following the modest unit cost inflation this year.
Juliusz Komorek: Everything else that can fit in the cabin can be charged for. And that's what passengers want. Passengers don't want all passengers to bring a 10kg bag to the gate, because they know that this will delay the departure of their flight. So the policy which Ryanair currently applies and which has been copied by many airlines in Europe works, consumers know it, and the European Parliament will figure it out just in their own time.
Speaker Change: Do you think about you.
Speaker Change: And of course over the next few years as we have a good fuel hedge in place, but its still the lions staffs maintenance airport deals how should we think about that and then the second question is Michael you've been making a lot of noise again recently about Hec, particularly in France have you seen any tangible signs of progress can be made there.
Speaker Change: <unk>.
Speaker Change: Okay, I'm going to offer the first one over to Tracy Mccann here on the longer term, what's your view on longer term unit cough, Neil feel free to add in at the end of that and then I'll deal I'll talk about the French ATC, bringing.
Juliusz Komorek: Thank you, Julius.
Harry Gowers: The next speaker is Harry Gowers of J.P. Morgan. Harry, please go ahead. Harry, hey. Yeah, morning, Michael. Um, just first question...
Speaker Change: Bringing julius as well on that so Tracy optical so I suppose into an extra deliverables purchased sand touched on that there was significant savings, but again, it's important to point out that we are seeing increased environmental and SaaS.
Unknown Executive: Close in pricing in Q1 and was wondering, that's something you've seen continue as a trend into Q2 so far. And then second one, probably one for Neil, you know, total unit cost per pax plus one in Q1 and exfuel was plus three. Is that the rate that we should be extrapolating across the full year? Or is there any reason to highlight why those numbers are ones that you know, we shouldn't be dragging outwards Q2, Q3, Q4? Thanks a lot. Thanks, Harry.
Speaker Change: Second that again this year we finished.
Speaker Change: Hopefully, we'll get the benefits of them incrementally.
Speaker Change: And we will get the benefit of the field, Brian I think the fact that we're financing the aircraft out of cash again. Unlike our competitors, we don't have them I financing cost. So I think the key we will have an inflationary cost increase the quota cap between us and the competition will continue to widen.
Unknown Executive: I mean, let me deal with the pricing. We are seeing stronger close in pricing, the load factors, we're running about 1% ahead of where we were at this time last year. So we have less seats to sell close in. There certainly we're engaged in less discounting, particularly as we move through Q1 and Q2. I think because of the approved OTA distribution, but I would caution again, your average fares are up 21% in Q1. I think about, you know, two thirds of that was accounted for by Easter and the OTA boycott. I think the like for like comparison of average fares in Q2 being up around 7%.
Speaker Change: Yes.
Speaker Change: And I know you want to add.
Speaker Change: The gap is the key points.
Speaker Change: Everybody acuity aware of our slide on unit costs, where we've now seen the next nearest competitor moved from what was over 50% of our GAAP to nearly 80% of our gaps and I expect that to remain in place. We will have a big competitive advantage. When we built our engine shops over the next few years.
Speaker Change: Advantage when we taken.
Speaker Change: The game changer aircraft with the <unk>.
Speaker Change: The extra seat.
Speaker Change: So I think that there will be we will remain very much head and shoulders above everybody else when it comes to unit costs stable future.
Unknown Executive: Recovering last year 7% fare decline is probably closer to what the underlying trend is through Q1 into Q2. And I hope that would continue into Q3. As we're saying this morning, we expect to recover almost all of last year's full year 7% fare decline. And the close in as we move into Q2 is strong. But that's also fragile. You know, and it's why we continue to be a little bit cautious on the kind of Q2 and full year guidance. You know, if we have some safety events, terrorist events in European cities, you know, something untoward or crazy or damaging comes out of the way, I don't see terrorists affecting short term booking flows.
Speaker Change: Okay.
Speaker Change: Okay. Thanks, Neil AGC I mean, I'll give you. An example, the so the first day that the French recreational strike on the third and fourth of July.
Speaker Change: This year Couldnt think of anything to strike over so they came up with that they are using old equipment in their shortstop.
Speaker Change: So there are solutions that has to go on strike on a Thursday and Friday of the bank holiday weekend in June no great surprise, there that cost us we had to because Europe, we're still hasnt acts to protect overflights, we were forced to cancel 700 flights canceled 130000 passenger journeys.
Unknown Executive: In fact, we're sitting here in a monsoon in Dublin this morning, which is probably good for close in pricing, certainly out of Dublin for At East London Centre, I'm quite a fan of barbecue Closing bookings, pricing up, but that's also fragile and that could fall over as we move through July, as we move through August and September into the second half of the year.
Speaker Change: If they had protected overflights, particularly from the UK and Ireland, where who are more susceptible to override cancellation when the French go on strike, 90% of those flight cancellations would have been avoided.
Speaker Change: We canceled 130000 passenger journeys average fare 65 years of about eight 5 million of revenue loss now clearly we can solidify. So we also have a cost savings, but if you take your kind of 20% net margin on eight 5 million. Those two days, we lost probably something of the order of about one 5 million of net profit just over two days.
Unknown Executive: Eddie, anything else you want to add on closing, pricing, and then we'll go to Neil on Unicom? No, I don't think, Mike, you've covered that all comprehensively.
Speaker Change: And in fact, we also picked up cost because we have rights to care expenses to re accommodate those passengers, which again because we're not allowed to.
Neil Sorahan: Jayden Eales, Unicost. Yeah, sure, Harry. I'm going to go back to my opening comments where I indicated that we're still guiding modest Unicost inflation on a full year basis, somewhere between 1% and 3%. We were 1% in the first quarter where we saw traffic grow by 4%. It'll be slower traffic growth into Q2 and the second half to get to 3% on a full year basis. I mean, it all hinges on whether we're between, say, 1% and 3%. It hinges on what happens to spot fuel over the balance of the year. It depends on what happens on the final schedule that we load, where is that going to be, and indeed, staffing in advance of next summer.
Speaker Change: You have immunity prosecution. So there is a solution to this is the solution has already adopted by the Spanish Italians had the Greeks and that is protective of registering national ATC strike. It doesn't measure somebody is ready to go on.
Speaker Change: But it means that the French logo flights will take all of the hate and you protect the overplayed.
Speaker Change: The commission did nothing more than a separate deal for aerospace Eurocontrol can run the old rates overrun on a day when France is having at ATC strike and we've seen it in defensive but the rest of underlying our horse of underlaid again as still won't take any action on this issue. It's a reasonably simple measure it would be one.
Neil Sorahan: So I think it's fair to just stick with that modest Unicost inflation. It'll be somewhere between 1% and 3%, and I won't be breaking it out more than that. Thanks Harry, thanks Neil.
Speaker Change: The most politically popular things European Commission could do in.
Dudley Shanley: The next question goes to Dudley Shanley of Goodbody. Dudley, please go ahead. Dudley, hi. Good morning, Michael. Two questions for me as well.
Speaker Change: In the face of post Brexit to demonstrate how we're delivering a single market on behalf of a Europe citizens. It does mean upsetting some French unions, but I think thats always.
Dudley Shanley: First of all, possibly to follow up on Harry's question a little bit, but to think about it more longer term. Following the modest unit cost inflation this year, how do you think about the unit costs over the next few years? Do we have a good fuel hedge in place? But it's the other lines like staff, maintenance, airport deals, how should we think about that?
Speaker Change: Of course, well worthwhile the more you can offset print unions the better.
Speaker Change: But all her incompetence and inaction on us.
Speaker Change: Bond relay and runs around talking about making Europe competitiveness, we need to be competitive in response Trump's tariffs in response to drag you report on when you give a very simple solution like protect overpriced during national ATC strike no action whatsoever.
Unknown Executive: And then the second question is, Michael, you've been making a lot of noise again recently about ATC, particularly in France. Have you seen any tangible signs that progress can be made there? Thank you.
Speaker Change: Are we making progress not much although we are continuing to campaign. We've now persuaded all of the European Airlines under <unk> for each campaign for override protection jewelry national strikes.
Unknown Executive: Okay, I'm going to offer the first one over to Tracey McCann here on the longer term. What's your view on longer term unit cost? Neil, feel free to add in at the end of that. And then I'll deal, I'll talk about French ATC. I might bring in Julius as well on that.
Speaker Change: But we still haven't seen.
Speaker Change: Much action out of the Commission I think if we keep campaigning we keep calling in explaining how simple this would be.
Tracey McCann: So Tracey, off you go. Yeah, so I suppose into next year, Dudley, we're about 36% hedged on the deal with significant cost savings. But again, it's important to point out that we are seeing increased environmental and staff costs offset. And that, again, this year, we've seen a significant We will get the benefits of them incremental seats, and we will get the benefits of the field borne. I think the fact that we're financing the aircraft out of cash, again, unlike our competitors, we don't have them. I finance them cost. So I think the key is, we will have inflationary cost increases, but the gap between us and the competition will continue to widen.
Speaker Change: We might get somewhere, but I'm afraid I can't point to any immediate.
Speaker Change: Action on it yet Julie do you want to add no Michael it's a <unk>.
Speaker Change: Summary, thanks, Okay. Thanks, Joe the next question please.
Speaker Change: The next question goes to you Alex <unk> of Bernstein, Alex. Please go ahead Alex.
Alex: Hey, good morning, gentlemen.
Speaker Change: We shouldnt expect to recover some but not all of last year's decline in Q2 looking at Q1 versus two years ago. You are up in 2023 was well into April how covenant argued this summer.
Speaker Change: Down not up on two years ago. It is just you're being prudent in the face of the acceleration you've highlighted.
Neil Sorahan: Neil, anything you want to add? The gap is the key point. Everybody is acutely aware of our slide 4 on unit costs where we've now seen the next nearest competitor move from what was over 50% of a gap to nearly 80% of a gap. I expect that to remain in place. We'll have a big competitive advantage when we build our engine shops over the next few years. We'll have a big advantage when we take in the game changer aircraft with the extra seat. So I think, Dudley, we'll remain very much head and shoulders above everybody else when it comes to unit costs for the foreseeable future.
Speaker Change: Second question is around the investment in 30 <unk> on the engines.
They were cheap, but wireless it's necessary at all are you concerned about underlying reliability issues and therefore should we be concerned about possible lower asset productivity or higher maintenance costs over the long run.
Speaker Change: Yes.
Speaker Change: Okay. Let me take both look I mean, where are we on fares.
Speaker Change: They were down 7% last year Q1 were up 21% in Q2, I think we're tracking for.
Speaker Change: Almost almost somewhere between 6%, 7% at the moment, but the reason why can't be constantly these how fragile we are or how dependent are those closing bookings through the remainder all bad.
Unknown Executive: Okay, thanks, Neil.
Unknown Executive: ATC, I mean, I'll give you an example. So the French recreational strike on the 3rd and 4th of July, they this year couldn't think of anything to strike over. So they came up with, they're using old equipment and they're short staffed. So their solution to that was to go on strike on a Thursday and Friday of the bank holiday weekend in June. No great surprise there. That cost us, we had, because Europe still hasn't acted to protect overflight, we were forced to cancel 700 flights, cancelled 130,000 passenger journeys. If they had protected overflights, particularly from the UK and Ireland, where who are more susceptible to overflight cancellation when the French go on strike, 90% of those flight cancellations would have been avoided.
Speaker Change: August and September and as of today, we have 73% of August So we have only 40% of September so so.
Speaker Change: If there's no great change that I would be very confident that we'd be up 7% in the second quarter, but we a very fragile to any short term adverse new slow terrorism safety event something like that so.
Speaker Change: Overall looking out over the 12 month period I think we're reasonably optimistic now I think we have improved the narrative Alex over from the full year results call, where it was we may expect to recover most but not all our at almost all which I think is a modest upgrade but still heavily subject too.
Unknown Executive: We cancelled 130,000 passenger journeys, average fare 65 euros, about eight and a half million of a revenue loss. Now, clearly, we cancelled the flights, so we also have a cost savings. But if you take a kind of 20% net margin on eight and a half million, those two days, you know, we lost probably something of the order of about one and a half million of net profit just over two days. And in fact, we also picked up costs because we had right to care expenses to re-accommodate those passengers, which again, because we're not allowed to.
Speaker Change: Any impact on close in bookings through the remainder of the year and if I look at the second.
Speaker Change: Our adversely affect close in bookings.
Speaker Change: 30, LIBOR B engines, why now is there anything on toward look the reason, we both Turkey leap <unk> engines is primarily and we did a deal with CFM, where CFM were offering us an exceptional discounts I think they wanted a deal I think they had may have had some financial the deadline there.
Speaker Change: Had some spare engines they were willing to.
Speaker Change: Heavily discount them for a quick sale and we were.
Speaker Change: Willing to buy them for a quick sale.
Speaker Change: Have more spare Lee will be and use as a result of that that we need for a fleet of 181 aircraft I think we will be up to what we bought.
Unknown Executive: is having an ATC strike. And we find it indefensible that Ursula von der Leyen, or Ursula von der Leyen again, still won't take any action on this issue. It's a reasonably simple measure. It would be one of the most politically popular things the European Commission could do in the face of post-Brexit to demonstrate how it's delivering a single market on behalf of Europe's citizens. It does mean upsetting some French unions, but I think that's always a cause well worthwhile. The more you can upset French unions, the better. But utter incompetence and inaction on it. Von der Leyen runs around talking about making Europe competitiveness.
Speaker Change: 120, <unk> ranges and.
Speaker Change: So a total of 120 spare engines desktop for the Chipotle has occurred.
Speaker Change: And we have more things that we need but as the as the game changer of the Max fleet grows with the 300 game changed your order we will still be short spare engine. So we moved at a time when.
Speaker Change: <unk> wanted was offering us a deep discount for a quick sale, we got a deep discount, which we can kind of bank on the balance sheet, we have spare cash and we think this is one of these areas, where we can deploy deploy spare cash sensibly.
Harry goers: Any impact on close in bookings through the remainder of the year and if I look at the second half of the year today, we have 6% of the seats sold.
Harry goers: We're very heavily dependent on those trends that may affect both boost our adversely affect close in bookings.
Unknown Executive: We need to be competitive in response to Trump's tariff, in response to the Draghi report. And when you give them a very simple solution like protect overflights during national ATC strikes, no action whatsoever.
Speaker Change: We are a little bit over we too many spare engines at the moment, but given that we know we're taking delivery of 330 aircraft over the next 10 years, it's a sensible short term opportunistic investments at the moment.
Harry goers: <unk>.
Harry goers: 30 leap <unk> engines, why now is there anything untoward look the reason, we both Turkey leap <unk> engines is primarily we did the deal with CFM, where CFM were offering us an exception to the discount I think they wanted a deal I think they may have had some financial deadline.
Unknown Executive: Are we making progress? Not much, although we are continuing to campaign. We've now persuaded all of the European airlines under A4E to campaign for overflight protection during national strikes. But we still haven't seen much action out of the Commission. I think if we keep campaigning, we keep calling and explaining how simple this would be, we might get somewhere. But I'm afraid I can't point to any immediate action on it yet.
Speaker Change: Any other concerns about.
Speaker Change: We don't have any concerns with LIBOR BS we are and we believe we will we are moving aggressively towards <unk>.
Harry goers: Had some spare ranges they were willing to.
Speaker Change: Announcing one or two as spare engine MRO shops.
Harry goers: Heavily discount them for a quick sale and we were.
Harry goers: Willing to buy them for a quick sale.
Harry goers: Have more spare Lee will be and use as a result of this that we need for a fleet of 181 aircraft I think will be up to what we bought.
Speaker Change: For one our differentiator between us and our competitors that we'd be able to maintain our edge is in housewares everybody else will be our competitors are in Europe will be exposed to third party engine maintenance, which is getting radically more expensive.
Juliusz Komorek: Julius, anything else you want to add? No, Michael, that's a great summary. Thanks.
Harry goers: 120, <unk> ranges there.
Harry goers: So in total we have 120 spare engines desktop for the <unk> B has occurred.
Alex Irving: The next question goes to Alex Irving of Bernstein. Alex, please go ahead. Alex, hi. Hey, good morning, gentlemen. You say you expect to recover some, but not all, of last year's decline in Q2. If I look at your Q1 versus two years ago, you're up, and Easter 2023 was well into April. So how confident are you that this summer's stares will be down, not up, on two years ago? Is this just you being prudent in the face of the external risks you've highlighted?
Harry goers: Everything.
Speaker Change: From 2028 onward, and also the turnaround times wildly escalated from typically around 65 days to something closer to 150 days.
Harry goers: We have more things that we need but as the as the game changer of the Max fleet grows with the 300 game changer order, we will still be short spare engine. So we moved at a time when.
Speaker Change: Which will put a lot of burden on <unk>.
Speaker Change: Our competitor, we know already with the problem with the engine repairs a lot of Airbus Airbus Airbus short haul aircraft are grounded in Europe last year, this year and probably again into next year as well and that in turn is creating opportunities for us to grow and improve the airfares and improving our profitability.
Harry goers: <unk> wanted was offering us a deep discount for a quick sale, we got a deep discounts, which we can kind of bank on the balance sheet, we have spare cash and we think this is one of these areas, where we can deploy deploy spare cash sensibly.
Unknown Executive: Second question is around the investment in 30-sphere LEAP-1B engines. I understand they were cheap, but why was this necessary at all? Are you concerned about underlying reliability issues? And therefore, should we be concerned about possible lower asset productivity or higher maintenance costs over the long run? Thanks. Okay, let me take both. Look, I mean, where are we on fares? They were down 7% last year. Q1, we're up 21%. Q2, I think we're tracking for... Almost up, almost, somewhere between 6% and 7% at the moment. But the reason why I can't be confident is how fragile we are, how dependent we are on those closing bookies through the remainder of August and September.
Harry goers: We are a little bit over.
Speaker Change: Thanks, Alex.
Harry goers: We have too many spare engines at the moment, but given that we know we're taking delivery of 330 aircraft over the next 10 years, it's a sensible short term opportunistic investments at the moment have we any other concerns about <unk>.
Speaker Change: Next question please.
Speaker Change: The next question go to Jared Caso of UBS.
Speaker Change: <unk>.
Speaker Change: Okay.
Speaker Change: Hi.
Speaker Change: Alright, good set of numbers.
Speaker Change: Two from me I mean, one of your low cost competitors was closing down there.
Harry goers: No frankly.
Harry goers: We don't have any concerns with the <unk>.
Harry goers: And we believe we will we are moving aggressively towards it.
Speaker Change: <unk> base and they've spoken about putting that capacity more in central and eastern Europe. So just interested in your thoughts on.
Harry goers: I think one or two.
Harry goers: Fair engine MRO shops in house, we have announced is that towards the end of the year.
Speaker Change: How you see that.
Speaker Change: Alright.
Harry goers: And we are pretty confident that we will continue to be another bone, our differentiator between us and our competitors that we'd be able to maintain our range is in house, whereas everybody else will be competitive certainly in Europe will be exposed to third party engine maintenance, which is getting radically more expensive from 2028 onwards, and also the turnaround times.
Speaker Change: And then secondly, maybe one for Nick.
Speaker Change: You said that Capex is going to be $2 2 billion, but could be higher on two legs.
Speaker Change: Is there any way you can maybe just give us a bit of magnitude depending on the scenarios on how much higher that could be thanks.
Unknown Executive: And as of today, we have 73% of August sold. We have only 40% of September sold. If there's no great change, then I would be very confident that we'll be up 7% in the second quarter. But it's very fragile to any short-term adverse news flow, terrorism, safety events, something like that. So overall, looking out over the 12-month period, I think we're reasonably optimistic now. I think we have improved the narrative, Alex, over from the full-year results call, where we've expected to recover most but not all. Now we're at almost all, which I think is a modest upgrade, but still heavily subject to any impact on close-in bookings through the remainder of the year.
Speaker Change: Oh Capex, Okay, John I'll take the first one and innovate Neil I'll, let you deal with the Capex, Firstly, Alex, albeit our Jared obviously.
Harry goers: Wildly escalated from typically around 65 days to something closer to 150 days.
Speaker Change: Feel comparatively stated we are just not a low cost competitor Ryanair.
Harry goers: Which will put a lot of burden on R.
Harry goers: Our competitor, we know already with the product with the engine repairs a lot of Airbus Airbus Airbus short haul aircraft are grounded in Europe last year, this year and probably again into next year as well and that in turn is creating opportunities for us to grow.
Speaker Change: I think.
Speaker Change: Surprised.
Speaker Change: The.
Speaker Change: Excuses they came up with for the withdrawal from Abu Dhabi, apparently mostly it was because of.
Harry goers: As improving airfares and improving our profitability.
Speaker Change: A desert out there and therefore.
Alex: Thanks, Alex.
Harry goers: Next question please.
Speaker Change: It creates a significant cost penalties on engines and to which we are acquiring are closing you're based in Saudi Arabia, which is equally a desert.
Harry goers: The next question go to Jared Caso of UBS.
Harry goers: Perhaps.
Harry goers: Hi.
Harry goers: Alright, good set of numbers.
Speaker Change: And penalty but.
Harry goers: Two from me I mean, one of your low cost competitors was closing down there.
Speaker Change: <unk> have always been let me see what's the photo inventive when it comes to explaining our commercial failures.
Harry goers: <unk> base and they've spoken about putting that capacity more in central and eastern Europe. So just interested in your thoughts on.
Unknown Executive: or adversity affect closing bookings.
Speaker Change: <unk>.
Unknown Executive: But 30 LEAP 1B engines, why now? Is there anything going to work? Look, the reason we bought 30 LEAP 1B engines is primarily, we did a deal with CFM where CFM were offering us an exceptional discount. I think they wanted a deal. I think they may have had some financial deadline. They had some spare engines, they were willing to heavily discount them for a quick sale. And we were willing to buy them for a quick sale. And we have more spare LEAP 1B engines as a result of this that we need for a fleet of 181 aircraft.
Speaker Change: Flip flops on strategy a couple of years ago, they were expanding going to expand aggressively into Vienna, and easily and challenge Ryanair. They quietly you treated out of bolt into the middle East, which is going to account for three of their traffic. They now appear to be retreating out of the middle east back into apparently centrally.
Harry goers: How you see the competitive environment going forward.
And then secondly, maybe one for Neil.
Neil: Said that Capex is going to be $2 2 billion, but could be higher on tooling.
Neil: Is there any way you can maybe just give us a bit of magnitude depending on the scenario on how much higher that could be thanks.
Speaker Change: So announcing a multi year growth dealer.
Speaker Change: Which will see us increase the traffic and margin by three fold over the next five years Wisdom last Friday announced the two aircraft based in marketing, which by the way I think it's good for modeling, we and we welcome more.
Neil: Oh Capex, Okay, John I'll take the first one Neil.
Speaker Change: I'll, let you deal with the Capex, Firstly, Alex obviously, our Jared obviously.
Unknown Executive: I think we'll be up to what we've got 120 spare engines. So until we have 120 spare engines, that's not for LEAP 1B, it's for everything. We have more spare engines than we need. But as the game changer, the max LEAP grows with the 300 game changer order, we will still be short spare engines. So we moved at a time when CFM was offering us a deep discount for a quick sale. We got a deep discount, which we can kind of bank on the balance sheet. We have spare cash and we think this is one of these areas where we can deploy spare cash sensibly.
Speaker Change: I feel compelled fixed rate that we use is not a low cost competitor of Ryanair, it's a high cost competitive of Ryanair and therefore, not really competitor at all.
Speaker Change: More.
Speaker Change: If we just once the base more aircraft in central Eastern Europe, and all it will do is highlight the enormous cost advantage and price advantage Ryanair has over with at all of our other competitors in every market, where <unk> has attempted to try to enter or compete against Brian there they've ultimately failed and withdrawn and I think that trend will continue.
Speaker Change: We were somewhat.
Speaker Change: Think.
Speaker Change: Im surprised at the.
Speaker Change: Excuses they came up with for the withdrawal from Abu Dhabi, apparently mostly it was because it's.
Speaker Change: Desert out there and therefore.
Speaker Change: It creates significant cost penalties on engines.
Speaker Change: But to the extent theyre going to reallocate there I mean, the real problem for ways to try to compete with Ryanair outgrow in central Eastern Europe is theyre growing good areas that they have.
Speaker Change: Which we are acquiring are closing you're based in Saudi Arabia, which is equally a desert.
Speaker Change: Ancient penalty, but.
Speaker Change: <unk> have always been let me see what's the photo inventive when it comes to explaining.
Speaker Change: Both are very expensively from their print shareholder then refinance the <unk> kind of sale leaseback recognizing madcap profits are.
Unknown Executive: We are a little bit over, we have too many spare engines at the moment. But given that we know we're taking delivery of 330 aircraft over the next 10 years, it's a sensible, short term, opportunistic investment at the moment.
Speaker Change: <unk> failures.
Speaker Change: No.
Speaker Change: Flip flops on strategy a couple of years ago, they were expanding going to expand aggressively into Vienna, and easily and channel and drawing here.
Speaker Change: In its balance sheet, we stay then mortgage over the next five or 10 years.
Speaker Change: So the more they grow the more gas.
Unknown Executive: Have we any other concerns about We don't have any concerns with the Leapwood Bees. We are, we believe we will, we are moving aggressively towards announcing one or two spare engine MRO shops in. A lot of Airbus short haul aircraft were grounded in Europe last year, this year and probably again into next year as well. And that in turn is creating opportunities for us to grow at improving airfares and improving our profitability. Thanks, Alex.
Speaker Change: You treated out to bolt into the middle East, which is going to account for their traffic. They now appear to be retreating out at the middle east back into apparently central and Eastern Europe.
Speaker Change: They're very expensive aircraft financing and our much lower cost.
Speaker Change: Depreciation charges.
Speaker Change: And on top of that then we have lower aircraft costs lower labor cost lower sales marketing costs and five lower recall and we will be debt free from mid 2026 onwards, where they're more receptive to the rifles I think their net debt position at the last number was about 6 billion euros with a market cap of about 1.1 on one.
Speaker Change: Or so announcing a multiyear growth dealer model, and which will see us increase the traffic in modern by three fold over the next five years Wisdom last Friday announced the two aircraft based in mountain, which by the way I think is good for a moment, we and we welcome more.
Speaker Change: 2 billion euros.
Speaker Change: Sure.
Speaker Change: If we just want the base more aircraft in <unk>.
Speaker Change: I continue to believe that the consolidation process in Europe will ultimately as he was taken out by somebody whether its debenture capital.
Speaker Change: Felicia in Europe, and all this will do is highlight the enormous cost advantage and price advantage Ryanair has over with all of our other competitors in every market, where <unk> has attempted to try to enter or compete against Brian there they've ultimately failed and withdrawn and I think that trend will continue.
Speaker Change: Surprised at somewhere in the Middle Eastern Airlines haven't moved always given the collapse in their market cap they.
Speaker Change: They do at least have a fleet of aircraft.
To the extent that they're going to reallocate there I mean, the real problem for ways in trying to compete with Ryanair outgrow in central Eastern Europe is theyre growing good aircraft that they have.
Speaker Change: Operating are in Europe in the next three to five years as an independent carrier and certainly now that their strategy is to move into more competition with Ryan there and we welcome the competition as it was demonstrated their blue.
Speaker Change: Both are very expensively from their principal shareholder than refinance them at ludicrous kind of sale and leaseback recognizing madcap profits are.
Speaker Change: Their brains out even faster than they have done in the desert to the middle East.
Jarrod Castle: The next question goes to Jarrod Castle of UBS.
Speaker Change: In its balance sheet, we stay then mortgage over the next five or 10 years.
Jarrod Castle: Jarrod, please go ahead. Hi, and well done on a very good set of numbers. Two from me. I mean, one of your low-cost competitors, Wiz, is closing down their Abu Dhabi base. And, you know, they've spoken about putting that capacity more into Central and Eastern Europe. So just interested in your thoughts on, you know, how you see the.
Speaker Change: Neil Capex, you want to touch on that.
Speaker Change: So the more they grow the more the gap widened between they're very expensive.
Speaker Change: Our crazy.
Speaker Change: I will.
Speaker Change: Gary It's a cautionary note that there could be upside on that $2 two depending on the timing of tooling or otherwise for their for the engine shops that very much depends on where we get to when negotiations if theres a benefit for example in taking stock sooner or are paying sooner for some of the plants and equipment to get.
Speaker Change: Aircraft financing and our much lower cost.
Speaker Change: Depreciation charges.
Speaker Change: On top of that then we have lower aircraft costs lower labor cost lower sales marketing costs in fact, lower it costs and we will be debt free from mid 2026 onwards, whereas their mortgage up to the REIT bowls I think their net debt position at the last number was about 6 billion euros with a market cap of about 1.1 or one two.
Unknown Executive: And then secondly, maybe one for Neil, you said that CapEx is going to be 2.2 billion, but could be higher on. Is there any way you could maybe just give us a bit of magnitude depending on the scenarios on how much higher that could be? Go Capex.
Speaker Change: Deep discounts, we may look at it but we're in the midst of negotiations at the moment.
Speaker Change: Don't have any numbers don't have any timing at this point in.
Speaker Change: Billion euros.
Speaker Change: Continue to believe that the consolidation process in Europe will ultimately.
Speaker Change: Point in time other than a cautionary note that you may see a little bit upside and if you are on the Capex and if you do it because we've locked in an advantage on the MRO going forward long term.
Speaker Change: <unk> taken out by somebody whether it's the venture capital.
Unknown Executive: Okay, Jarrod, I'll take the first one and then I'll let you deal with the Capex. Firstly, Jarrod, obviously, I feel compelled to explain that Waze is not a low cost competitor of Ryanair. I think surprised at the excuses they came up with for the withdrawal from Abu Dhabi. Apparently, mostly it was because it's a desert out there, and therefore it creates significant cost penalties on engines, to which we said, well, why are you not closing your base in Saudi Arabia, which is equally a desert with an engine penalty? We have always been inventive when it comes to explaining commercial failures and flip-flops on strategy.
Speaker Change: Surprised at some of the Middle Eastern Airlines haven't moved on with given the collapse in their market cap.
Speaker Change: Thanks.
Speaker Change: They do at least have a fleet of aircraft the aircraft at a very expensive, but thats never really worried that middle eastern investors overtime, but.
Tracy Mccann: Tracy you want to add on Capex or deal cover I think thats pretty much covered yes. Okay. Next question. Please.
Speaker Change: The next question Gucci, Sam <unk> of Raymond James.
Speaker Change: But I don't believe will be.
Speaker Change: Operating.
Speaker Change: Please go ahead.
Speaker Change: Hum.
Speaker Change: In Europe in the next three to five years as an independent carrier and certainly now that their strategy is to move into more competition with Brian here. We welcome the competition as it demonstrates that the blow their brains out even faster than they have done in the desert middle East.
Speaker Change: Just on the you called out on the media call Burma, and environmental costs going up from like four <unk> to.
Speaker Change: 530.
Speaker Change: As your cost gap should be widening but is there a risk that you end up getting a larger share of a smaller pie or is demand strong enough. We can absorb these costs going forward a bit of a longer term question and then the second one is just a quick follow up on Capex.
Speaker Change: Neil Capex, you want to touch on that.
Speaker Change: Tracy.
Speaker Change: I will.
Speaker Change: Gary It's a cautionary note that there could be upside on that $2 two depending on the timing of tooling or otherwise for their for the engine shops that very much depends on where we get to when negotiations if theres a benefit for example in taking stock sooner or are paying sooner for some of the plants and equipment to get.
Speaker Change: I Wonder if you could kind of give an update about the comments you made on fiscal year 2007 and beyond.
Unknown Executive: A couple of years ago, they were going to expand aggressively into Vienna and Italy and challenge Ryanair. They quietly retreated out of both into the Middle East, which was going to account for a third of their traffic. They now appear to be retreating out of the Middle East back into, apparently, central Saudi Arabia. also announcing a multi-year growth deal at Modlin, which will see us increase the traffic at Modlin by three-fold over the next five years. Wizz on last Friday announced a two-aircraft base in Modlin, which, by the way, I think is good for Modlin, and we welcome more, you know, if Wizz wants to base more aircraft in Central Eastern Europe, all it will do is highlight the enormous cost advantage and price advantage Ryanair has over Wizz and all of our other competitors.
Speaker Change: Just related to this engine capex coming in.
Speaker Change: Okay. We can come back you need all the Capex <unk> Thomas Fowler here Who's our.
Speaker Change: Deep discounts, we may look at it but we're in the midst of negotiations at the moment.
Thomas Fowler: Ahead of our fuel and Enviro Thomas you want to take that tackle the <unk>.
Speaker Change: Don't have any numbers don't have any timing at this point in point in time other than a cautionary note that you may see a little bit upside and if he is on the capex and if you do it because we've locked in an advantage on the MRO going forward long term.
Thomas Fowler: Average question of viral cost with demand over time, our fares cover rising in viral cost.
Thomas Fowler: I think in the short term our time it will because I think the competition as the volumes.
Thomas Fowler: Corporate MRO cost I think one thing we've done we have discussed for the last 12 years.
Speaker Change: Thanks.
Thomas Fowler: Yes, our cost will increase but I think the cost of the competition will increase further because particularly over the last four years in EES ere free allowances of cover there.
Speaker Change: Tracy you went out on Capex or deal cover I think thats pretty much correct. Yes. Okay. Next question. Please.
Speaker Change: The next question Gucci start thesis of Raymond James.
Thomas Fowler: Exposure or so.
Speaker Change: Please go ahead.
Thomas Fowler: I think what will happen is as we would've solved with oil prices and channels, enabling we saw fuel surcharges, culminating with Needham increased MRO surcharges are are increasing as long as we have on our cost line advantage and I think we should be able to contract.
Speaker Change: Okay.
Speaker Change: Just on the you called out on the media call Neera.
Unknown Executive: In every market where Wizz has attempted to try to enter or compete against Ryanair, they've ultimately failed and withdrawn, and I think that trend will continue. But to the extent that they're going to reallocate there, I mean, the real problem for Wizz in trying to compete with Ryanair or grow in Central Eastern Europe is they're growing with aircraft that they have done both very expensively from their shareholder. They then refinance them at ludicrous kind of sale and leaseback, recognising mad cap profits are in its balance sheet, which they then mortgage over the next five or 10 years.
Speaker Change: Environmental costs going up from like four pretax five theory.
Speaker Change: I realize your cost gap should be widening but is there a risk that you end up getting a larger share of a smaller pie or is demand strong enough to absorb all these costs going forward. So a bit of a longer term question and then the second one is just a quick follow up on Capex.
Speaker Change: Okay, and Neil one towards Capex FY 'twenty seven.
Speaker Change: So I would still anticipate savvy that the capex dips below $2 billion next year and then the year after that will be somewhere between two and a half and $3 billion as we start to ramp of PDP and deliveries of the Tan starts come in so no I wouldn't have much more to add.
Speaker Change: If you could kind of give an update to some of the comments you made on fiscal year 2007 and beyond.
Speaker Change: Just related to this engine capex coming in.
Unknown Executive: So the more they grow, the more the gap widens between their very expensive aircraft financing and our much lower cost depreciation charges. And on top of that, then we have lower aircraft costs, lower labour costs, lower sales marketing costs, in fact, lower every cost. And we will be debt free from mid-2026 onwards, whereas they're mortgaged up to the eyeballs. I think their net debt position at the last number was about 6 billion euros with a market cap of about 1.1 or 1.2 billion euros. I continue to believe that the consolidation process in Europe will ultimately see Wizz taken out by somebody, whether it's a venture capital.
Thomas: Okay, we can come back to you need on the Capex I'm Thomas.
Speaker Change: We are here who is our.
Speaker Change: And then the commentary I gave back in May other than we've taken the engines and now for this year, where youre seeing us at the two two for the current year and we should still be below $2 billion into next year.
Speaker Change: Ahead of fuel and viral Thomas you want to tackle the <unk>.
Speaker Change: Question on the viral cost with demand over time, our fares cover rising in viral cost.
Speaker Change: In the short term our time it will because I think the competition with <unk> to cover the MRO cost I think one thing we've gone. We've had these calls for the last 12 years as we've grown our cost will increase but I think the cost of the competition will increase further because particularly over the last four years.
Speaker Change: Okay, Savi and discretionary please.
Speaker Change: The next question Gucci, James Hollins of Exane BNP Papa James Please go ahead.
Speaker Change: We've really one for you Michael.
Unless rail maybe just trying to see your plans, there and whether kind of.
Speaker Change: Yes.
Speaker Change: The allowances of cover their.
Speaker Change: The situation has led to some pockets over capacity. This summer what you saw in the canaries in the winter.
Speaker Change: Exposure.
Speaker Change: So I think what will happen is as we would've solved with oil prices into channels, enabling we saw fuel surcharges cullinane, you'll see them increase obviously higher surcharges are are increasing as long as we have on our cost line advantage and I think we should be able to contract value.
Unknown Executive: I'm surprised that some of the Middle Eastern airlines haven't moved on Wizz, given the collapse in their market cap. They do at least have a fleet of aircraft. are operating in Europe in the next three to five years as an independent carrier and certainly not if their strategy is to move into more competition with Ryanair. We welcome the competition as it will demonstrate that they'll blow their brains out even faster than they have done in the deserts of the Middle East.
Speaker Change: And with the niche that is normalized and then Michael maybe just take us behind the scenes real conversations with Stephens Piper Kelly from Boeing on the Max 10 certification you seen way more confident than you have for a long time that it will get satisfied.
Speaker Change: <unk> seen maybe just run us through walnuts.
Neil: Okay, and Neil one towards Capex FY 'twenty seven.
Speaker Change: While our confidence is coming from <unk>.
Neil: <unk>, Yeah, no real change to what I would have said back in May. So you would still anticipate savvy that the capex dips below $2 billion next year and then the year after that will be somewhere between two and a half and $3 billion as we start to ramp of PDP and deliveries of the Tan starts to come in and so no I wouldn't have much more to add.
Speaker Change: Thanks, James 80, maybe you take the Israeli you might add Jordan into that as well, which is obviously also affected our Thursday, Israel and Jordan with the current middle East instability in our deal with them Stephanie.
Speaker Change: Yeah, I mean, what had happened there was where we were in the the height of the summer when things escalators.
Neil Sorahan: On that, Neil, CAPEX, do you want to touch on that, or Tracy?
Speaker Change: Particularly with Iran. We took the the issue obviously from first of all from a safety point of view, but like we have to take a longer term view them. After that risk assessment, and then say look we're going to reallocate that capacity. The difficulty is that once you put that capacity on sale reversing that pie game.
Neil Sorahan: I will, I will, Jarrod. It's a cautionary note that, you know, there could be upside on that 2.2 depending on the timing of tooling or otherwise for the engine shops. That very much depends on where we get to in negotiations. If there's a benefit, for example, in taking stock sooner or paying sooner for some of the plants and equipment to get deep discounts, we may look at it.
Neil: <unk>.
Neil: And then the commentary I gave back in May other than we've taken the engines and now for this year, where youre seeing us at the two two for the current year and we should still be below $2 billion next year.
Savi: Thanks, Savi next question Natalie please.
Speaker Change: What may seem like tensions have come down but like it.
Savi: Our next question Gucci, James Hollins of Exane BNP Papa James Please go ahead.
Unknown Executive: But we're in the midst of negotiations at the moment, don't have any numbers, don't have any timings at this point. point in time, other than a cautionary note that you may see a little bit upside on the CapEx. And if you do, it's because we've locked in an advantage on the MRO going forward long term.
Savi: We've already seen Michael.
Speaker Change: <unk> been talking to the edge or damien's in particular, who are anxious to have us.
Savi: Got it.
Savi: Israel, maybe just run us through your plans, there and whether kind of the situation that has led to some pockets of capacity. This summer what you saw in the canaries in the winter.
Speaker Change: And should have us back in there.
Speaker Change: And we are currently talking to them. So we still haven't.
Speaker Change: And whether that's a normalized and then Michael maybe just take us behind the scenes your conversations with Stephanie probably for Kelly from Boeing on the Max 10 certification you seen way more confident that you have for a long time that it will get certified parts.
Speaker Change: We we would've had upwards of about 100 weekly frequencies.
Unknown Executive: Thanks Neil. Tracy, anyone out on CapEx or Neil cover up? I think that's pretty much covered, yeah.
Speaker Change: Into Tel Aviv Ah <unk>.
Speaker Change: And frankly less into Jordan with Jordan is a good market, particularly for the winter time, and we're going to we will we'll take a view on that because what we're doing at the moment is we're assessing and the winter allocations were down to the last couple of airports in countries, particularly where we continue to.
Savanthi Kayani: The next question goes to Savanthi Sitt of Raymond James. Savanthi, please go ahead. Hey, good morning, everyone. Yeah, just on the, you know, you called out on the video called environmental costs going up from like four putbacks to 530.
Speaker Change: <unk>, maybe just run us through why that's why our confidence is coming from <unk>.
Speaker Change: Thanks, James 80, maybe you take the Israeli you might add Jordan into that as well, which is obviously also affected our service to Israel and Jordan with the current middle East instability in our deal with them Stephanie Pope.
Speaker Change: Put the focus on cost is where that capacity is allocators and Israel and Jordan will be in the mix on that but for obviously for different reasons. So we haven't finalized for the winter, yet and we're still talking to them.
Unknown Executive: I realize your cost gap should be widening, but is there a risk that you end up, you know, getting a larger share of a smaller pie or is demand strong enough to absorb all these costs going forward? So a bit of a longer-term question.
Speaker Change: Yes.
Speaker Change: What had happened there was we were in the height of the summer when things escalators.
Speaker Change: Particularly with Iran. We took the issue obviously from first of all from a safety point of view, but we have to take a longer term view.
Speaker Change: Okay, and James in relation to Boeing.
Unknown Executive: And then the second one is just a quick follow-up on CapEx. I wonder if you could kind of give an update to some of the comments you made on fiscal year 27 and beyond just related to with this engine CapEx coming in. Okay, we come back to you Neil on the CapEx.
Speaker Change: I continue to believe.
Speaker Change: After that risk assessment, then say look we're going to reallocate that capacity. The difficulty is that once you put that capacity on sale reversing that back in.
Speaker Change: <unk> orphan Berg, Stephanie Pope are doing a great job share repo in particular I mean, there is no doubt that the quality of what is being produced at the hose and Wichita in the aircraft in Seattle has dramatically improved in fact, we have scaled back we no longer have engineers based in Wichita, they're not allowing any holds be moved to Seattle because he has any deepak. So every.
Speaker Change: What may seem like.
Speaker Change: Tensions have come down, but like it's in July and August September took the decision to leave that until the end of the.
Thomas Fowler: I'm Thomas Fowler here, who's our head of fuel and Enviro. Thomas, do you want to tackle Savi's question on EnviroCost? Will demand over time or fares cover rising EnviroCost? I think the competition will have to rise first to cover the environmental costs. I think one thing we've done, we've had this cost for the last 12 years as we've grown. Yes, our costs will increase, but I think the cost of the competition will increase further, because particularly over the last four years in EGS, their free elements have covered their EGS exposure, while ours hasn't. So I think what will happen is that we would have settled with oil prices.
Speaker Change: At the end of the summer.
Speaker Change: End of the summer season, we have been talking to the Jordanians in particular, who are anxious to have us.
Speaker Change: <unk> moving defect free that is speeding up the production in Seattle and also.
Speaker Change: What kind of are anxious to have us back in there.
Speaker Change: Materially increase the quality of what's coming out of Seattle.
Speaker Change: And we are currently talking to them. So we still haven't we we would've had upwards of about 100 weekly frequencies.
Speaker Change: And all I can point to you is you know originally the 'twenty nine delayed aircraft for huge contrasts to the spring of 2026.
Speaker Change: Asked us could we take them early in August September October November 2025, we said, we would even though it doesn't suit us from a cash point of view, but given pre past experience. If we can secure the aircraft early in advance of summer 2006, we would and we take them.
Speaker Change: Tel Aviv.
Speaker Change: And frankly less into Jordan with Jordan is a good market, particularly for the winter time, and we're going to we will take a view on that because what we're doing at the moment is we are assessing the winter allocations were down to the last couple of airports in countries, particularly where we continue to.
Speaker Change: I still think they would favor those early I think she's doing a great job.
Unknown Executive: We saw fuel surcharges coming in. You'll see them increase, whether it be in oil surcharges or increase in price. As long as we have our cost line advantage, I think we should be able to cover it.
Speaker Change: Noninterest taken about one week.
Speaker Change: Put the focus on cost as to where that capacity is allocators and Israel.
Speaker Change: Following the 787 practices to be there on the ground in India, but <unk> you call Stephanie She's in Seattle, There's a problem you should pick up the big off the board and color and I think ourselves and the rest of the wider team there.
Speaker Change: Jordan will be in the mix on that but for obviously for different reasons. So we haven't finalized for the winter, yet and we're still talking to them.
Neil Sorahan: Okay, Neil, you want to touch camp except by 27 and... I would still anticipate, Savi, that the CapEx dips below 2 billion next year, and then the year after that will be somewhere between 2.5 and 3 billion, as we start to ramp up PDPs and deliveries off the 10 start to come in. So, no, I wouldn't have much more to add than the commentary I gave back in May, other than we've taken the engines in now for this year, where you're seeing us at the 2.2 for the current year, and we should still be below 2 billion into next year.
Speaker Change: Okay, and James in relation to Boeing.
Speaker Change: Really got enough they completed a pay increase of 40%, though morale has improved significantly attendances and prudent but they are doing a good job and they are delivering those aircrafts much more important than that in the short term is the progress on certification.
Speaker Change: I continue to believe.
Speaker Change: <unk> orphan Berg, Stephanie pulp are doing a great job Jeffrey pulp in particular, I mean, there is no doubt that the quality of what is being produced at the hose and Wichita in the aircraft in Seattle has dramatically improved.
Speaker Change: We've scaled back we no longer have engineers based in Wichita, they're not allowing any hold to be moved to Seattle. If he has any defects. So every holders moving defect free that is speeding up the production in Seattle and also <unk>.
Speaker Change: They expect I think the new administration has been a bit more supportive of Boeing the new hated the FAA I think is still to be approved.
Speaker Change: Congress, but we expect that imminently.
Speaker Change: I was a bit concerned about certification of the aircraft.
Speaker Change: Clearly increased the quality of what's coming out of Seattle.
Unknown Executive: Thanks, Sabi.
Unknown Executive: Next question, Nadia, please.
Speaker Change: Stephie I previously promised at that Boeing would tell us one way or another by the end of June whether we were going to get whether they were going to deliver those air Max 10 stores in the spring of 2027 are we would change back and take more addition of more <unk> hundred She's now confirmed in writing that we will get the Max 10, they will come on the delivery.
Speaker Change: All I can point to you is you know originally the 'twenty nine delayed aircraft for acute come towards the spring of 2026. They asked US could we take them early in August September October November 2025, we said, we would even though it doesn't suit us from a cash point of view, but given pre past experience. If we could security aircraft early in advance of December 26, we will.
James Hollins: The next question goes to James Hollins of Exsane B&P Paribas. James, please go ahead. Yeah, one for Eddie, one for you, Michael. Eddie, on this rail, maybe just run us through your plans there and whether kind of the situation there has led to some pockets of overcapacity this summer, like you saw in the Canaries in the winter, and whether you expect that to normalise.
Speaker Change: Date in the first quarter in the first five months of 2027.
Speaker Change: And we take them up.
Speaker Change: I still think they would favor those early I think she's doing a great job.
Unknown Executive: And then, Michael, maybe just take us behind the scenes of your conversations with Stephanie Pope or Kelly from Boeing on the MAX 10 certification. You seem way more confident than you have for a long time that it will get certified pretty soon. Maybe just run us through why that conference is coming from. Thank you. Thanks, James.
Speaker Change: And then we're getting Max hands.
Speaker Change: And hopefully confirm that in writing I think they've been had some.
Speaker Change: Noninterest taken about one week off.
Speaker Change: In the last number of months.
Speaker Change: Are there other customers United most notably have deferred Max 10 deliveries have converted some back to 800.
Speaker Change: He went over to India. Following the 787 crash just to be there on the ground in India, but you called Stephanie She didn't Seattle Theres a problem. If you pick up that we can pick up the board and color and I think ourselves and the rest of the wider team there.
Speaker Change: And I think that's probably has helped things. They are shortly if not already in September they expect will elaborate Dave hit rate Turkey. It may again in June we'll do so again in July.
Edward Wilson: Eddie, maybe you take Israel, you might add Jordan into that as well, which has obviously also affected our service to Israel and Jordan with the current Middle East instability. And I'll deal with Stephanie Pope. Yeah, I mean, what had happened there was we're in the height of the summer. And when things escalated, particularly with Iran, we took the issue obviously, first of all, from a safety point of view, but we had to take a longer term view after that risk assessment and say, look, we're going to reallocate that capacity. The difficulty is that once you put that capacity on sale, reversing that back in, you know, and what may seem like tensions have come down, but if you been talking to the Jordanians in particular, who are anxious to have us back in there.
Speaker Change: I've really got enough. They can see the pay increase of 40%. So you don't morale has improved significantly.
Speaker Change: Basically be allowed to go up to a 42 by the FAA sometime in September October this year.
Speaker Change: Tendencies improvement so, but they are doing a good job and they are delivering those aircrafts much more important than that in the short term is the progress on certification.
Speaker Change: The situation continues to significantly improve but yes. It does.
Speaker Change: So I think the new administration has been a bit more supportive of Boeing the new hated the FAA I think is still to be approved.
Speaker Change: Not to say they don't face challenges like if something falls off in aircrafts somewhere something untoward happen.
Speaker Change: Our plan could get derailed, but certainly everything at that I think Kelly and definitely both have done in the last 12 months have been impressive the delivery has been impressive and the quality of us getting delivered.
Speaker Change: Congress, but we expect that imminently.
Speaker Change: I was a bit concerned about certification of the aircraft.
Speaker Change: Stephanie previously promised that Boeing would tell us one way or another by the end of June whether we were going to get whether they were going to deliver those.
Speaker Change: He's now top notch and I would be much more bullish than longhorn Boeing than I have been for the last I think 345 years.
Speaker Change: <unk> tends to us in the spring of 2027 are we would change back and take more addition, more <unk> hundred. She has now confirmed in writing that we will get the Max 10, they will cover off the delivery date in the first quarter and the first five months of 2027.
Speaker Change: There is not without challenges or problems, but I think they really are getting on top of it.
Unknown Executive: And we are currently talking to them. So we still haven't, you know, we would have had upwards of about 100 weekly frequencies into Tel Aviv, significantly less into Jordan, but Jordan is a good market, particularly for the wintertime. And we're going to, we'll take a view on that, because what we're doing at the moment is we're assessing the winter allocations. We're down to the last couple of airports and countries, particularly where we continue to put the focus on costs as to where that capacity is allocated. And Israel and Jordan will be in the mix on that, but for obviously for different reasons.
Speaker Change: And then we're getting Max tens.
Speaker Change: Their own deliveries are Asian process as well.
Speaker Change: And that should hopefully confirm that in writing I think they've been had some.
Speaker Change: Alright. Thanks, Thanks, James next question please.
Speaker Change: There other customers, United most notably have deferred Max 10 deliveries have converted some back to 800.
Speaker Change: The next question guys from any bad Kayani of Bank of America. Please go ahead.
Speaker Change: Yes.
Speaker Change: And I think that's probably has helped things they are shortly if not already in September they expect their average they've hit rate 38. It may again in June we'll do so again in July they expect CB allowed to go up to rate 42 by the FAA sometime in September October this year.
Speaker Change: Good morning, my questions have been answered, but just wanted to ask what's your latest thinking on cash return to shareholders. I know you have your buybacks right now but you.
Speaker Change: You had <unk> 2 billion of net debt as of June.
Speaker Change: July is the bundled payments and Capex commitments, you've talked about but would you what's your thinking on another share buyback at this point.
Unknown Executive: So we haven't finalized for the winter yet. And we're still talking.
Speaker Change: I think the situation continues to significantly improve but that's not to say they don't face challenges like if something falls off in aircrafts somewhere something untoward happens.
Unknown Executive: Okay, and James, in relation to Boeing, you know, I continue to believe Kelly Ortenburg, Stephanie Pope are doing a great job. Stephanie Pope in particular, I mean, there is no doubt that the quality of what has been produced at the hulls in Wichita and the aircraft in Seattle has dramatically improved. In fact, we've scaled back, we no longer have engineers based in Wichita, they're not allowing any hulls to be moved to Seattle if it has any defects. So every hull is moving defect free, that is speeding up the Much more important than that in the short term is the progress on certification.
Speaker Change: I mean.
Speaker Change: We're not seeing anything you know that we are we've announced another share buyback program about $750 million I think that will run over the next.
Speaker Change: At that time could get derailed, but certainly everything is that I think Kelly and Stephanie bulk of gone in the last 12 months have been impressive the delivery has been impressive the quality was getting delivered.
Speaker Change: 12 to 18 months.
Speaker Change: I'm, a little bit I think we and the board are little bit Central I did the share price has been rising strongly.
Speaker Change: For new shareholders coming on the register and I think.
Speaker Change: He is now top notch and I would be much more bullish than longhorn Boeing than I have been for the last I think 345 years.
Speaker Change: If anything we don't want to be beating the share price up against them. So if there's plenty of demand for our shares we would rather let the markets.
Speaker Change: Sure.
Speaker Change: It is not without challenges or problems, but I think they really are getting on top but and.
Speaker Change: Solve that.
Speaker Change: But we expect the current buyback would run out until the middle of next year middle of 2026.
Speaker Change: Now are delivering aircraft earlier and are ready to go up in production.
Speaker Change: As well from September so.
Speaker Change: I see no reason to address additional share additional shareholder returns over and above that we have a number of very significant challenges. We have to now just over $2 billion bond repayments for the next 12 months.
Speaker Change: I am much more hopeful and clearly they're much more confidence in their own delivery and certification process as well.
James: Alright. Thanks, Thanks, James Your question please.
Speaker Change: We there are going to be other opportunistic capex things like that.
Kayani: The next question goes from any back Kayani of Bank of America. Please go ahead.
Speaker Change: The 30 leap spare won't be engines, and we want to have a balance sheet to be able to address that.
Speaker Change: Good morning, Scott.
Scott: My questions have been answered, but just wanted to ask what's your latest thinking on cash return to shareholders. I know you have your buybacks right now.
Speaker Change: And I would you know having paid down that bond that we should be down to your gross net cash of the order of about $2 billion I would like to see that grow towards three or $4 billion.
Scott: You had two 2 billion of net debt as of June.
Scott: I realize the bond repayments and Capex commitments, you've talked about but what do you. What's your thinking on another share buyback at this point.
Speaker Change: Over the next year or two.
Speaker Change: While we continue to fund.
Speaker Change: The Capex will step over the next year or two as we start to get into the Boeing Max 10 orders, but the.
Scott: I mean.
Scott: We're not seeing anything.
Scott: We announced the share buyback program about $750 million I think that will run over the next.
Speaker Change: The overwriting I think assurance shareholders could take from the board has been that wherever we identify that we have excess cash it will be returned to shareholders in the form of dividend and our share buyback and we have a share buyback already committed out to the middle of 2026 and there is another.
Scott: 12 to 18 months.
Scott: I'm, a little bit I think we and the board are little bit essentially that the share price has been rising strongly lots of.
Scott: New shareholders coming on the register and I think.
Unknown Executive: So, they expect, I think the new administration has been a bit more supportive of Boeing. The new head of the FAA, I think, is still to be approved by Congress, but we expect that imminently. I was a bit concerned about certification of the aircraft. Stephanie had previously promised that, you know, that Boeing would tell us one way or another by the end of June whether we were going to get, whether they were going to deliver those, the MAX 10s to us in the spring of 2027, or we would change back and take more additional, more A200s.
Scott: If anything we don't want to be beating the share price up against them. So if there's plenty of demand for our shares we would rather let the market.
Scott: Sorry.
Speaker Change: So.
Scott: But we expect the current buyback would run out until the middle of next year middle of 2026.
Speaker Change: Our commitment to returning spare cash to shareholders remains.
Speaker Change: On on challenged.
Scott: I see no reason to address additional share additional shareholder returns over and above that we have a number of very significant challenges. We have to now just over 2 billion of bond repayments for the next 12 months.
Speaker Change: But we will continue to shepherd.
Speaker Change: Cash zealously and maintain a reasonably conservative balance sheet, because we're in a very cyclical capital intensive business the business subject to unforeseen shocks.
Unknown Executive: She's now confirmed in writing that we will get the MAX 10s, they will come on the delivery date in the first quarter, in the first five months of 2027, and that we're getting MAX 10s. And she's helpfully confirmed that in writing. I think they've been helped. Some of their other customers, United most notably, have deferred MAX 10 deliveries, have converted some back to A800s, and I think that probably has helped things. They are shortly, if not already in September, they expect, well, they've hit rate 38 in May, again in June, will do so again in July.
Scott: There are going to be other opportunistic capex things like that.
Speaker Change: And the way to weather our way through those shocks has to go into them with lafarge.
Scott: The <unk> leap spare won't be engines, and we want to have a balance sheet to be able to address that.
Speaker Change: Cash reserves in the balance sheet, but we can do.
Scott: And I would having paid down that bond that we should be down to <unk>.
Speaker Change: Attractive yields on our distress aircraft parts are distressed engine purchases as those opportunities arise.
Scott: Gross net cash of the order of about $2 billion I would like to see that grow towards three or $4 billion over the next year or two.
Speaker Change: Thanks <unk> next question please.
Scott: While we continue to fund.
Speaker Change: The next question Guy Savoy Cullinane of research RBC capital markets. Please go ahead brewery height.
Scott: The Capex will step up in the next year or two as we start to get into the Boeing Max 10 orders, but.
Speaker Change: Hi, Good morning, Firstly would you be able to quantify the contribution of la occurring ratios to the impressive staff unit cost performance in the quarter, what they stand where can they get to and secondly, it looks like you're towards close.
The overwriting I think assured shareholders could take from the board has been that wherever we identify that we have excess cash it will be returned to shareholders in the form of dividends and our share buyback, we have a share buyback already committed out to the middle of 2026 and there is another dividend due for payment in September.
Unknown Executive: basically be allowed to go up to 842 by the FAA sometime in September, October this year. And I think the situation continues to significantly improve. But that's not to say they don't face challenges. Like if something else falls off an aircraft somewhere, something untoward happens, that plan could get derailed. But certainly everything that I think Kelly and Stephanie both have done in the last 12 months have been impressive. The delivery has been impressive. The quality of what's getting delivered is now top notch. And I would be much more bullish and long on Boeing than I have been for the last, I think, three, four or five years.
Speaker Change: Hedging.
Speaker Change: In the quarter, which looks well times, but when should we expect your interest in fuel hedging for full year 2007.
Scott: Subject to AGM approval in September I think of about.
Scott: 200 million order, but 22% or <unk> 23, a share so.
Speaker Change: Okay, maybe ask.
Speaker Change: I ask you to address the lower Crewing ratios is more by reference to the fact, we had higher crewing ratios last year because of the Boeing delivery delays in the coming back into and then I asked actually Thomas Fowler to touch on fuel hedging and <unk> when.
Scott: Our commitment on returning spare cash to shareholders remains.
Scott: On on challenged.
Scott: But we will continue to shepherd cash zealously and maintain a reasonably conservative balance sheet, because we're in a very cyclical capital intensive business the business subject to unforeseen shocks.
Speaker Change: When we expect to increase our <unk>.
Speaker Change: Hedging position Traci crew ratios that we did have cutting lasers did fall in the fourth quarter, but it's just again they were too high because of the delay in the delivery of aircraft. We just had slower recruitment, but we will see that probably ramp up again as the ramp up for next summer.
Unknown Executive: It's not without challenges or problems, but I think they really are getting on top. and their own delivery and certification process as well. Great, thanks.
Scott: And the way to weather our way through those shocks has to go into them with large.
Scott: Cash reserves in the balance sheet, but we can do attract.
Speaker Change: For an aircraft deliveries and we will have and and moderate pay increases is up.
Scott: Attractive yields on distressed aircraft ports are distressed engine purchases as those opportunities arise.
Unknown Executive: Thanks, James.
Muneeba Kayani: Next question, please, Daniel. The next question goes to Muneeba Kayani of Bank of America. Muneeba, please go ahead.
Speaker Change: Thanks, Tracy and Thomas you want to touch on fuel hedging and my boss needs to come in at the.
Scott: Thanks <unk> next question please.
Speaker Change: On the back of your remarks.
Speaker Change: The next question guys you will recall the name of research RBC capital markets. Please go ahead brewery height.
Speaker Change: I think when you look at what we did at the end of May.
Unknown Executive: Good morning. Most of my questions have been answered, but I just wanted to ask what's your latest thinking on cash return to shareholders? I know you have your buyback right now, but you had $2 billion of net debt as of June. I realize the bond repayments and CAPEX commitments you've talked about, but what's your thinking on another share buyback? I mean, we're not doing anything, you know, we've announced another share buyback program of about 750 million. I think that will run over the next 12 to 18 months. I'm a little bit, I think we and the board are a little bit sensitive, the share price has been rising strongly, lots of new shareholders coming on the register.
Speaker Change: Obviously as you said like olive oil over the line.
Speaker Change: Hi, Good morning, Firstly would you be able to quantify the contribution of low occurring ratios to the impressive staff unit cost performance and of course to what they stand and what can they get to and secondly, it looks like imports post.
Speaker Change: Bill.
Speaker Change: But we will go past hedge them probably at some stage.
Speaker Change: And in the next few months due to our policies do meet on some which hedging demand grew ahead of previous years.
Speaker Change: Hedging.
Speaker Change: In the quarter, which looks well timed.
Speaker Change: I'm going to split the opportunistic bounced back to hedge and again, when we see the oil price normalized.
Speaker Change: Should we expect your interest in <unk>.
Speaker Change: For full year 2007.
Speaker Change: And remember the Opex is all well hedged as well sorry go ahead.
Speaker Change: Okay, maybe I'll.
Speaker Change: I ask you to address maybe the lower crewing ratios, it's more by reference to the fact, we had higher crewing ratios last year because of the Boeing delivery delays in the coming back into and then I might ask.
Speaker Change: I was going to say.
Speaker Change: That Tracy mentioned earlier on we've been building on the Euro dollar and we can take the patch at the weaker dollar which also plays into our R. A few lines.
Unknown Executive: And I think, you know, if anything, we don't want to be bidding the share price up against them. So if there's plenty of demand for our shares, we would rather let the market solve that. But we expect the current buyback will run out until the middle of next year, middle of 2026. I see no reason to address additional shareholder returns over and above that.
Speaker Change: You asked actually Thomas Fowler to touch on fuel hedging and when.
Speaker Change: We're in the peak summer period.
Speaker Change: When we expect to increase our <unk>.
Speaker Change: Spot oil for chat is elevated at the moment.
Speaker Change: <unk> hedging position Tracy two ratios that we did have currently shows did fall in the fourth quarter, but it's just again they were too high because of the delay in the delivery of aircraft. We just had slower recruitment, but we will see that probably ramp up again as we ramp up for next summer.
Speaker Change: We've got big volumes. So we can move to market against ourselves. So I think we will happily SaaS.
Speaker Change: We see the opportunities again in the market in the Bakken at that time as Thomas said.
Speaker Change: Okay. Thanks Laurie.
Speaker Change: Next question please.
Speaker Change: For an aircraft deliveries and we will have.
Unknown Executive: We have a number of very significant challenges. We've just over 2 billion of bond repayments the next 12 months. There are going to be other opportunistic things like the 30 leap spare 1B engines, and we want to have a balance sheet to be able to address that. And I would, you know, having paid down that bond debt, we should be down to, you know, gross net cash of the order of about 2 billion. I'd like to see that grow towards 3 or 4 billion over the next year or two. While we continue to fund, you know, the CapEx will step up in the order.
Speaker Change: Next question Dicey Jaina Mistry of Jefferies. Please go ahead.
Speaker Change: Marvel pay increases is up.
Speaker Change: Thanks, Tracy and Thomas you want to touch on fuel hedging and my boss needs to come in at the on the back of your remarks.
Speaker Change: Hi, Dana and thank you for taking my question.
Speaker Change: Two questions. Please first and is there anything in particular, that's driving strength in your ancillary per passenger in Q1.
Speaker Change: Well I think I think when you look at what we did at the end of May we were it was down a fair bit of hedge and once Johan.
Speaker Change: And then second question.
Speaker Change: So obviously as you said the prices are volatile over the line.
Speaker Change: Thank you to an earlier question around medium term opex inflation.
Speaker Change: Few weeks.
Speaker Change: We will go past hedge them properly.
Speaker Change: Let's just say that unit cost inflation is the medium term is positive.
Speaker Change: And in the next few months due to our policy to return some which hedge in a no go ahead.
Speaker Change: With SaaS coming on EU, ETS et cetera.
Speaker Change: Do you feel comfortable adopting our price right strategy against tobacco fish slightly higher than average constellation.
Speaker Change: Sure.
Speaker Change: I'm going to just be opportunistic announced the fact that hedge and again when we see the oil price normalize a bit.
Unknown Executive: But the overriding, I think, assurance shareholders could take from the board has been that whatever we identify that we have excess cash, it will be returned to shareholders in the form of dividends and our share buyback. We have a share buyback already committed out to the middle of 2026. There is another. So our commitment on returning spare cash to shareholders remains unchallenged.
Speaker Change: Sorry, adopting a path to a price strategy with it.
Speaker Change: And remember the Opex is all well hedged as well sorry go ahead.
Speaker Change: Yes.
Speaker Change: I was going to say right.
Speaker Change: Price increase strategy is that I'm, sorry, yes, yes.
Speaker Change: Tracy mentioned earlier on we've been building on the Euro dollar.
Speaker Change: Yes.
Eddie Wilson: Okay, and maybe Eddie.
Speaker Change: We can take advantage of the weaker dollar, which also plays into our our fuel line.
Eddie Wilson: Do you want to comment on them on salaries in Q1 and the trend in ancillary.
Speaker Change: We're in the peak summer period.
Eddie Wilson: We were up 3% in Q1 against traffic rose 3%.
Speaker Change: <unk> oils for chat is elevated at the moment.
Eddie Wilson: I think there is a lot of this is just enter the work that's going on.
Speaker Change: We've got big volumes. So we can move to market against ourselves. So I think we will happily SaaS.
Eddie Wilson: In labs, and and what is the what is happening in terms of pricing models and adjusting those and also we've made some.
Speaker Change: Because we see the opportunities again in the market in the Bakken at that time as Thomas said.
Unknown Executive: But we will continue to shepherd cash zealously and maintain a reasonably conservative balance sheet because we're in a very cyclical, capital-intensive business. The business is subject to unforeseen shocks. And the way to weather our way through those shocks is to go into them with large cash reserves as a balance sheet where we can do attractive deals on distressed aircraft purchases or distressed engine purchases as those opportunities arise.
Speaker Change: Okay. Thanks, Laurie and now the next question please.
Eddie Wilson: Decent headway on.
Eddie Wilson: The mobile App, which is.
Speaker Change: Next question Daiichi Jaina Mistry of Jefferies. Please go ahead.
Eddie Wilson: As a significant part of our AR bookings now and how has that actually has been the mendes in recent months.
Speaker Change: Hi, Thanks for taking my question.
Speaker Change: Two questions. Please.
Speaker Change: And is there anything in particular, that's driving strength in your ancillary pathogen in Q1.
Eddie Wilson: In terms of how you know bags are presented priority boarding is for is presented and we're seeing some upswing in there so better penetration at better matching of products based on demand.
Speaker Change: And then second question.
Speaker Change: It's related to an earlier question around medium term opex inflation.
Eddie Wilson: As we say on these calls all the time this is sort of incremental growth all the time and tweaking and tweaking.
Speaker Change: But let's just say that unit cost inflation at the medium term is positive.
Unknown Executive: Thanks, Muneeba.
Unknown Executive: Next question, please, Nadia.
Speaker Change: With SaaS coming on EU, ETS et cetera would you feel comfortable.
Eddie Wilson: Tweaking these models based on what demand is out there for those particular products.
Ruairi Cullinane: The next question goes to Ruairi Cullinane of Research RBC Capital Markets. Ruairi, please go ahead. Ruairi, hi. Hi, good morning.
Speaker Change: Our price right strategy against the backdrop, this slightly higher than average cost inflation.
Tracy Mccann: If Tracy I had to add any comments.
Unknown Executive: Firstly, would you be able to quantify the contribution of lower crewing ratios to the impressive staff unit cost performance in the quarter? Where do they stand and where can they get to?
Speaker Change: Sorry, adopting a path to a price strategy with it.
Tracy Mccann: From a drop in salaries.
Speaker Change: Yes.
Speaker Change: Right.
Speaker Change: Price increase strategy.
Tracy Mccann: Which helps on the trade percent uplift on a per passenger basis I'd go back to my opening comments, where I indicated on a full year basis I still think it's kind of one 2% at per passenger growth all of the reasons that that Eddie has set.
Unknown Executive: And secondly, it looks like you paused fuel hedging in the quarter, which looks well timed, but when should we expect you to resume fuel hedging for year 27? Thank you.
Speaker Change: Yes right.
Speaker Change: Okay, and maybe Eddie.
Speaker Change: Do you want to comment on them on salaries in Q1 and the trend in ancillary.
Speaker Change: We were up 3% in Q1 against traffic rose to 3%.
Tracy Mccann: Set out there.
Speaker Change: Yes, I think there is a lot of this is just enter the work that's going on.
Tracy Mccann: What labs and everything else.
Tracey McCann: Okay, maybe Tracey, I'll ask you to address maybe the lower crewing ratios. It's more by reference to the fact we had higher crewing ratios last year because of the Boeing delivery delays and they're coming back into, and then I might ask actually Thomas Fowler to touch on fuel hedging and, you know, when we expect to increase our fuel hedging position. Tracey, crew ratios? So we did have, crewing ratios did fall in the first quarter, but it's just again, they were too high because of the delay in the delivery aircraft. We just had slower recruitment, but we will see that probably ramp up again as we ramp up for next summer, for aircraft deliveries and we will have moderate pay increases as well.
Tracy Mccann: Tracy just I think it is important to highlight that Q1 is extremely strong entertainment there because of that Easter impact of that.
Speaker Change: <unk> and <unk>.
Speaker Change: And what is the what is happening in terms of pricing models and adjusting those and also we've made some decent.
Tracy Mccann: Very low comparable.
Speaker Change: Okay. Thank you and all of the longer term data on the unit cost inflation, Firstly I think.
Speaker Change: Decent headway on.
Speaker Change: The mobile App, which.
Speaker Change: I mean generally long term bullish on unit cost inflation.
Speaker Change: Is a significant part of our bookings down.
Speaker Change: Whereas you have easy jet in.
Speaker Change: How would that actually has been amended in recent months.
Speaker Change: With that others have already up gauge in recent years, we're about from spring 'twenty seven onwards to get into a major up gauging as we move into the Max 10.
Speaker Change: In terms of bags.
Speaker Change: Bags are presented priority boarding is presented and we're seeing some upswing in there so better penetration.
Speaker Change: Debater capacity aircraft will undoubtedly put downward pressure on fares and yields but with capacity generally across Europe heavily constrained out to 2030, I think bears will hold up reasonably well if not continue to rise, particularly in markets like Germany, Our Dublin, where yeah government inaction means theyre not.
Speaker Change: Better matching of products based on demand and as we say on these calls all the time this is sort of incremental growth all the time and tweaking.
Unknown Executive: Thanks, Tracy.
Thomas Fowler: And Thomas, do you want to touch on fuel hygiene? My bad, Neil to come in at the on the back of your remarks. Yeah, well, I think I think when you look at what we did at the end of May. So obviously, as you said, the price has been volatile over the last few weeks, but we will go back hedging probably at some stage in the next few months due to our policy. But we've done so much hedging in May, we were ahead of where we were the previous year, so we'll just be opportunistic now to start hedging again when we see the oil price normalise a bit.
Speaker Change: Tweaking these models based on what demand is out there for those particular products.
Speaker Change: If tracy.
Speaker Change: It is.
Speaker Change: Allowing us to use the additional capacity that already exists and so on.
Speaker Change: Alright.
Speaker Change: Yes.
Speaker Change: Sure.
Speaker Change: We will need a pricing <unk> pricing will modestly rise between now and trading dirty because of the overall capacity constraints, but I think we'll do better on unit cost inflation over that period, when we start taking delivery of meaningful numbers of aircraft that have 30% more seats, but burn 20% less fuel so you get a 40%.
Speaker Change: I would say as well China, we did have a positive impact from these from Ian salaries.
Speaker Change: On that 3% uplift on a per passenger basis.
Speaker Change: Back to my opening comments, where I indicated on a full year basis I still think it's kind of 1% to 2% per passenger growth all of the reasons that already has.
Neil Sorahan: And remember, the op-ex is well hedged as well.
Speaker Change: <unk> cost saving per passenger you get a saving in terms of few of staff efficiency airport and handling cost efficiency for 20% more passengers I think we're going to see an ever widening is hurt that unit cost advantage between us and our competitor Airlines in Europe, depending on how many competitive airlines, we have by the time, we get <unk> 27.
Speaker Change: Set out there.
Speaker Change: What labs are doing and everything else.
Unknown Executive: Sorry, Neil. Go ahead. That's exactly what I was going to say. You know, Tracey mentioned earlier on, we've been, you know, building on the euro-dollar. We've been taking advantage of the weaker dollars, which also plays into our fuel line. We're in the peak summer period. spot oil for Jet is elevated at the moment. We've got big volumes so we can move the market against ourselves. So I think we will happily sit until we see the opportunities again in the market and go back in at that time, as Thomas said. Okay, thanks, Rory.
Speaker Change: Tracy just I think it is important to highlight that Q1 is extremely strong at the famous there because of that Easter impact is that.
Speaker Change: Very low comparable okay.
Speaker Change: Okay. Thank you and the longer term data on the unit cost inflation, Firstly I think.
Speaker Change: I think generally long term bullish on unit cost inflation.
Speaker Change: In 2028, given consolidations, though.
Speaker Change: I do believe that a capacity constrained generally in Europe, which we now trade dirty.
Speaker Change: Whereas you have easy Jason.
Speaker Change: We used that others have already up gauged in recent years, we're about from spring 'twenty seven onwards to get into a major up gauging as we move into the Max 10.
Jaina Mistry: Nadia, next question, please.
Speaker Change: The biggest capacity aircraft will undoubtedly put downward pressure on fares and yields but with capacity generally across Europe heavily constrained out to 2030, I think fares will hold up reasonably well if not continue to rise, particularly in markets like Germany, Our Dublin, where government inaction means theyre not.
Speaker Change: For Airlines competitor Airlines, who can't manage their com are foreseen to constraining capacity, increasing airfares and that will send more and more traffic in our direction as we've seen this summer with the recovery in the iOS.
Unknown Executive: Next question goes to Jaina Mistry of Jeffreys. Jaina, please go ahead. Jaina.
Unknown Executive: Two questions, please. Just first, is there anything in particular that's driving strength in your ancillaries per passenger in Q1? And then the second question, it's related to an earlier question around medium-term OPEC concentration. But let's just say that unit cost concentration over the medium-term is positive. With SAF coming on, EU, ETS, etc., would you feel comfortable adopting a price growth strategy against a back-office slightly higher than average cost investment? Sorry, Adopting a WhatsApp Price Strategy, was it? Yes. Price increase strategy, is that the term you use? Yes.
Speaker Change: Bookings into Ryanair moving away from competitor tour operators and airlines.
Speaker Change: Allowing us to use the additional capacity that already exists and so.
Speaker Change: Thank you Dan our next question please.
Speaker Change: The next question Gucci Gerald <unk> of Padma Liberum Gerald Please go ahead.
Speaker Change: We won't need a pricing strategy I think pricing will modestly rise between now and 2030 because of the overall capacity constraint, but I think we'll do better on unit cost inflation over that period, when we start taking delivery of meaningful numbers of aircraft that have 20% more seats, but burn 20% of that few so you get a 40%.
Speaker Change: When you have one thing for me if I can firstly, what's happened to stage links in Q1, and what do you think's going to happen.
Speaker Change: Mind.
Speaker Change: Yeah.
Speaker Change: And secondly.
Speaker Change: Some of your competitors have been talking about seeing later bookings I was wondering whether you had seen the same leading between lines. I think we can have maybe you're seeing with us I'm just wondering if you'd give some view on when timing of bookings is fully in place.
Speaker Change: <unk> cost saving per passenger you get a saving in terms of few of staff efficiency airport and handling cost efficiency for 20% more passengers I think we're going to see an ever widening <unk> unit cost advantage between us and our competitor Airlines in Europe, depending on how many competitive airlines, we have by the time, we get to $3 27.
Edward Wilson: Okay, and maybe Eddie, do you want to come in on ancillaries in Q1 and the trend in ancillaries? We were up 3% in Q1 against Traffic Roads at 3%. Yeah, I think there's a lot of this is just down to the work that's going on in labs and and what is what is happening in terms of pricing models and adjusting those. And also, we've made some decent headway on, you know, the mobile app, which is a significant part of our bookings now and how that actually has been amended in recent months, in terms of how, you know, bags are presented, priority reporting is presented, and we're seeing some upswing in there.
Speaker Change: Yes, maybe I'll touch on the second one as needed through the stage length. I mean, I think what our competitors are opened later bookings if you like the reverse of last year's trend, where we had a boy otas boycott had the otas booked more with the tour operator to some of our competitor Airlines. That's reversing this year without approved LTA agreements, we are seeing a.
Speaker Change: Between 2008, given consolidations, though.
Speaker Change: I do believe that capacity constrained generally in Europe, which we now have trade 30, we'll see prices continue to.
Speaker Change: Zinc recovery in our OTA bookings those okay bogey tend to book further in advance they tend to be people Boeing.
Speaker Change: Our modestly in place particular as those other airlines competitor Airlines, who can't manage their comps are foreseeing too constraining capacity, increasing airfares and that will send more and more traffic in our direction as we've seen this summer with the recovery in the Doj bookings into Ryanair moving away from.
Speaker Change: Holiday packages.
Speaker Change: So we are seeing actually stronger advance bookings and higher fares this year, but partly by reference to a weak prior year comp, whereas our competitors are seeing.
Speaker Change: Laser focused laser close in bookings this year by reference to a better prior year comp last year because of our Otas boycott.
Speaker Change: <unk> tour operators and airlines.
Edward Wilson: So better penetration, better matching of products based on demand. And, you know, as we say on these calls all the time, this is sort of incremental growth all the time in tweaking these models based on what demand is out there for those particular products.
Dan: Thank you Dan our next question please.
Speaker Change: The next question guys, Hey, Joe Road King of Padma Liberum, Joe take care.
Speaker Change: And I think Thats, all youre seeing there is definitely them and us and we expect that to continue to grow through will continue through to the fact that the remainder of <unk>.
Speaker Change: When you have one thing from me if I can firstly help them to stage links in Q1, and what do you think it's going to happen for the remainder of the year.
Tracey McCann: Tracy, anything you want to add to Eddie's comments? Sorry. from EASTER on the ancillaries, which helped on the 3% uplift on a per passenger basis. I'd go back to my opening comments, where I indicated, you know, on a full year basis, I still think it's kind of 1-2% per passenger growth for all of the reasons that Eddie has set out there in what labs are doing and everything else. Yeah, just I think it is important to highlight that Q1 is extremely strong, the same is fair because of that EASTER impact as well. and very low comparable.
Speaker Change: Neil.
Neil: Thanks in Q1 and for the rest of the year.
Speaker Change: Secondly, some of your competitors have been talking about seeing later bookings I was wondering whether you had seen to say leading between mines.
Neil: There's nothing notable to talk about there in the quarter, we saw our flight hours of 4% in line with our growth.
Speaker Change: Maybe you'll see with us I'm just wondering if you could give some view on when timing.
Neil: So again the longer sectors to drive it. So I mean, the average last year was just over two hours is not going to be using the similar.
Speaker Change: Bookings is fully in place.
Speaker Change: Yes, maybe I'll touch on the second one as needed through the stage length, I mean, I think what our competitors are talking about laser bookings. If you like the reverse of last year's trend, where we had a boy otas boycott on the Otas booked more with the tour operators into some of our competitor Airlines. That's reversing this year without approved LTA agreements, we are seeing a.
Neil: On a full year basis this year for sectors.
Speaker Change: Petromart. Thanks, Neal Thank you Gerald and 90 next question. Please.
Speaker Change: We have no further questions I'll hand back to you Michael Sanitizing.
Speaker Change: Okay, just before I close I'd ask Jamie you might just update us on where we are on the share buyback program as of last Friday. The current program by product search on that.
Speaker Change: Dramatic recovery in our OTA bookings those LTA bogie tend to book further in advance they tend to be people going on holiday packages.
Unknown Executive: Okay, thank you. The longer you're down on the unit cost inflation. Firstly, I think, you know, I've been generally long term bullish on unit cost inflation, you know, whereas you have EasyJet and Wizz and others have already upgaged in recent years. We're about from spring 27 onwards to get into a major upgaging as we move into the max 10. The bigger capacity aircraft will undoubtedly put downward pressure on fares and yields. But with capacity generally across Europe heavily constrained out to 2030, I think fares will hold up reasonably well, if not continue to rise, particularly in markets like Germany or Dublin, where government in action means they're not allowing us to use the additional capacity that already exists.
Speaker Change: As Jamie Donovan, our head of IR at where we are on the current update on the share buyback program.
Speaker Change: So we are seeing actually stronger advanced bookings and higher fares this year, but partly by reference to a weak prior year comp, whereas our competitors are seeing.
Speaker Change: $60 million through Q1 as at the end of June.
Speaker Change: There are available to them under six or 7% and $2 million to $750 million buyback.
Speaker Change: Asia booklet laser close in bookings this year by reference to a better prior year comp last year because of our OTA client and I.
Speaker Change: Okay. Thank you for that as they as chairman. Thank you for taking part in the call again strong Q1, but don't get this way that does not have any irrationally exuberant Q1 is artificially boosted by a weak prior year comp Q2 will be much more.
Speaker Change: I think thats all youre seeing is definitely in them and us and we expect that to continue to grow will continue through to the remainder of page one.
Speaker Change: Yes.
Speaker Change: Like a normal year on year comparison is that we expect to recover almost all of last year's 7% fare decline in Q2, but that's a long way behind the Q1 average fare increased 21% overall for the year as long as the close in booking trend remains strong as long as we don't prefer.
Speaker Change: Thanks in Q1 and for the rest of the year.
Speaker Change: There is nothing notable.
Unknown Executive: So I think we won't need a pricing surge. I think pricing will modestly rise between now and 2030 because of the overall capacity constraints. But I think we'll do better on unit cost inflation over that period. When we start taking delivery of meaningful numbers of aircraft that have 20% more seats, but burn 20% less fuel, so you get a 40% fuel cost saving per passenger, you get a saving in terms of fuel of staff efficiency, airport and handling cost efficiency for 20% more passengers, I think we're going to see an ever widening, certainly unit cost advantage between us and our competitor airlines in Europe, depending on how many competitor airlines we have by the time we get to 2027 or 2028, given consolidation.
Speaker Change: Talk about there in the quarter, we saw our flight hours of 4%, which is in line with our sector growth.
Speaker Change: 4% traffic. Unlike a number of our competitors, we're not moving into longer sectors to drive it. So I mean, the average last year was just over two hours is not going to be using the similar.
Speaker Change: Encounter any unforeseen adverse development of safety terrorism, and war pestilence or stupidity out of the White House and I think we're set fair for a reasonably strong profit recovery in H, one and we would hope that that will continue on into for the remainder of the year. Although we do have tougher prior year comps in the second half.
Speaker Change: On a full year basis this year section.
Steve: Petro much thanks, Steve Thank you Gerald and now the next question. Please.
Michael: We have no further questions I'll hand back to you Michael for any closing.
Speaker Change: Okay, just before I close I'd ask Jamie you might just update us on where we are on the share buyback program as of last Friday. The current program I forgot to touch on that.
Speaker Change: Of the year.
Speaker Change: On the revenue side, because we did better in the second half of last year, having fixed at EOG void costs and on the cost side, we did have a modest as.
As Jamie Donovan, our head of IR at where we are on the current update on the share buyback program over $60 million through Q1 as at the end of June and survey with longer six or 7% and $2 million to $750 million buyback.
Unknown Executive: So I do believe that capacity constraints generally in Europe between now and 2030. airlines, competitor airlines who can't manage their costs, are forced into constraining capacity, increasing airfares. And that will send more and more traffic in our direction, as we've seen this summer with the recovery in the OTA bookings into Ryanair, moving away from competitor tour operators and airlines.
Speaker Change: Supplier compensation in the second half of last year that won't be repeated in the second half of this year, but overall I think we are cautious.
Speaker Change: Okay. Thank you for that as chairman. Thank you for taking part in the call again strong Q1, but don't get this way.
Speaker Change: Q2 will be reporting Q2 to you at the end of October and you'll see some of it in the traffic results for July August and September.
Speaker Change: Not have any irrational exuberance Q1 is artificially boosted by a weak prior year comp Q2 will be much more.
Speaker Change: And.
Speaker Change: Like a normal year on year comparison is that we expect to recover almost all of last year's 7% fair declined in Q2, but thats a long way behind the Q1 average fare increase to 21% overall for the year as long as the close in booking trend remains strong as long as we don't prefer.
Speaker Change: All I can say that apart from that we will continue to be very disciplined and diligent on cost control is the thing that really separates us from our all other airlines in Europe I will look forward to repay the two bonds to 850 in September one 2 billion next may which would make Ryan are uniquely at.
Gerald Khoo: Thank you, Diana. Next question, please, Dania. The next question goes to Gerald Khoo of Panmer Liberum. Gerald, please go ahead. Morning everyone, talk for me if I can.
Unknown Executive: Firstly, what's happened to stage length in Q1 and what do you think is going to happen for the remainder of the year? And secondly, some of your competitors have been talking about seeing later bookings. I was wondering whether you had seen the same reading between lines. I don't think you have, maybe you're seeing the reverse. I was wondering if you could give some view on where the timing of bookings has fallen, please. Yeah, maybe I'll touch on the second one and then I'll need to do the stage length. I mean, what our competitors are talking about later bookings is, if you like, the reverse of last year's trend where we had a boy OTA boycott and the OTAs booked more with the tour operators of some of our competitor airlines.
Speaker Change: Debt free going forward and we will continue to commit to return excess cash to shareholders there'll be another day, a brand subject to AGM approval in September and.
Speaker Change: Encounter any unforeseen adverse development on safety terrorism.
Speaker Change: War pestilence or stupidity out of the White House, then I think we're set fair for a reasonably strong profit recovery in H, one and we would hope that that will continue on into for the remainder of the year. Although we do have tougher prior year comps in the second half of the year on the revenue side.
Speaker Change: Jamie and the team will continue to roll forward the share buyback.
Speaker Change: Platt.
Speaker Change: We hope and expect that we will take delivery of the dredge nine aircraft from Boeing tariff free add between now and Christmas and that ultimately Boeing will be successful in getting the Max seven Max 10 start by the end of this year. So we can look forward with some to be a confidence to taking those Max 10 deliveries in 27 28.
Speaker Change: We did better in the second half of last year, having fixed at EOG employee costs and on the cost side, we did have some modest as the <unk>.
Speaker Change: By our compensation in the second half of last year that won't be repeated in the second half of this year, but overall I think we are cautiously optimistic for a reasonably strong profit recovery for the full year.
Unknown Executive: That's reversing this year. With our approved OTA agreements, we're seeing a dramatic recovery in our OTA bookings. Those OTA bookings tend to book further in advance. They tend to be people going on holiday packages. So we are seeing actually advanced bookings and higher fares this year, but partly by reference to a week prior year comp, whereas our competitors are seeing later bookings, later close in bookings this year, by reference to a better prior year comp last year because of our OTA boycott. And I think that's all you're seeing is differences between them and us. And we expect that to continue through to the remainder of H1.
Speaker Change: And also being able to move on.
Speaker Change: The dollar or the cap of the dollar hedging of that Capex.
Speaker Change: With hedge accounting in place.
Speaker Change: I have nothing else at <unk> do you want to add before we close off.
Speaker Change: It will depend on Q2, we'll be reporting Q2 to you at the end of October.
Michael Sanitizing: No I don't have anything Michael.
Speaker Change: You'll see some of it in the traffic results for July August and September.
Okay. Mario Thank you very much you had thank you Ed is Jim if anybody has any individual queries.
Speaker Change: And.
Speaker Change: All I can say that apart from that we will continue to be very disciplined and diligent on cost control. It's the thing that really separates us from our all other airlines in Europe, we look forward to repay the two bonds to $8 50 in September one 2 billion next may which would make Ryan are uniquely debt free going forward.
Speaker Change: You're free to call, Jamie and the team, we're not doing a road show us as normal on the Q1.
Speaker Change: But if anybody has any queries pleased that fires I mentioned, Jamie if you want to come visit us a substation over to some of our please feel free to do so as long as you're flying with Ryanair in one of our competitor you'll be very welcome.
Neil Sorahan: Neil, stage length in Q1 and for the rest of the year? There's nothing notable to talk about there. In the quarter, we saw our flight hours at 4% in line with our other growth. moving into longer sectors to drive it. So, I mean, the average last year was just over two hours. It's not going to be usually dissimilar on a full-year basis this year for sectors. Thanks very much. Thanks, Neil.
Speaker Change: Thank you very much everybody and we'll all go back to work. Thank you bye bye.
Speaker Change: And we will continue to commit to return excess cash to shareholders there'll be another.
Speaker Change: Burdened subject to AGM approval in September and.
Speaker Change: Jamie and the team will continue to roll forward the share buyback.
Speaker Change: <unk>.
Speaker Change: We hope and expect that we will take delivery of the <unk> nine aircraft from Boeing tariff free between now and Christmas and that ultimately Boeing will be successful getting the Max seven Max 10 started by the end of this year. So we can look forward with some degree of confidence to taking those Max 10 deliveries in 27%.
Unknown Executive: Thank you, Jarrod.
Unknown Executive: And now the next question, please. We currently have no further questions, so I'll hand back to you, Michael, for any closing.
Speaker Change: 88, and also being able to move on.
Jamie Donovan: Okay, just before I close, I might ask, Jamie, you might just update us on where we are on the share buyback programme as of last Friday, on the current programme, I forgot to touch on that. Is Jamie Donovan, our Head of IR, where we are on the current update on the share buyback programme? We're about £60 million through Q1, as at the end of June, and for a little under 6% or 7%, and £750 million buyback.
Speaker Change: The dollar out of the cabinet the dollar hedging of that Capex.
Speaker Change: With hedge accounting in place.
Speaker Change: I have nothing else add anything idea need anything else you want to add before we close off.
Speaker Change: No it doesn't have anything Michael.
Speaker Change: Okay. Thank you very much you had thank you Ed is Jim if anybody has any individual inquiries I feel free to call Jamie and the team we're not doing a road show as is normal on the Q1.
Unknown Executive: Okay, thank you for that. Ladies and gentlemen, thank you for taking part in the call. Again, strong Q1, but don't get dissuaded. Let's not have any irrational exuberance. Q1 is artificially boosted by a week prior your comp. Q2 will be much more, I think, like a normal year-on-year comparison. As I said, we expect to recover almost all of last year's 7% fair decline in Q2, but that's a long way behind the Q1 average fair increase of 21%. Overall for the year, as long as the close-in booking trend remains strong, as long as we don't encounter any unforeseen adverse developments on safety, terrorism, war, pestilence or stupidity out of the White House, then I think we're set fair for a reasonably strong profit recovery in H1, and we would hope that that will continue on into for the remainder of the year, although we do have tougher prior year comps in the second half of the year on the revenue side, because we did better in the second half of last year, having fixed the OTA boycott.
Speaker Change: But if anybody has any queries police fire as I mentioned, Jamie if you want to come visit us at some stage over the summer. Please feel free to do so as long as you're flying with Ryanair and not one of our competitors.
Speaker Change: You'll be very welcome.
Speaker Change: Are you very much everybody and we'll all go back to work down. Thank you bye bye.
Speaker Change: Thank you. This now concludes today's call. Thank you all for joining you may now disconnect your lines.
Speaker Change: Yeah.
Speaker Change: Sure.
Speaker Change: Yes.
Speaker Change: Yes.
Speaker Change: Yes.
Unknown Executive: And on the cost side, we did have some modest supplier compensation in the second half of last year that won't be repeated in the second half of this year. But overall, I think we're Q2.
Speaker Change: Yes.
Unknown Executive: We'll be reporting Q2 to you at the end of October. You'll see some of it in the traffic results for July, August and September. And all I can say is apart from that, we will continue to be very disciplined and diligent on cost control. It's the thing that really separates us from all other airlines in Europe. We look forward to repaying the two bonds, 850 in September, 1.2 billion next May, which will make Ryanair uniquely debt-free going forward. And we will continue to commit to return excess cash to shareholders. There'll be another different subject to ATM approval in September and Jaime and the team will continue to roll forward the share buyback plan.
Speaker Change: Sure.
Speaker Change: Okay.
Unknown Executive: We hope and expect that we'll take delivery of the 29 aircraft from Boeing tariff-free between now and Christmas and that ultimately Boeing will be successful in getting the Mach 7, Mach 10 cert by the end of this year. So we can look forward with some degree of confidence to taking those Mach 10 deliveries in 27, 28 and also being able to move on the dollar or the dollar hedging of that CapEx with hedge accounting in place.
Unknown Executive: I have nothing else to add. Eddie, anything?
Unknown Executive: Eddie or Neil, anything else you want to add before we close up? No, I don't have anything, Michael.
Unknown Executive: Okay, Nadia, thank you very much for your help. Thank you, ladies and gentlemen. If anybody has any individual queries, feel free to call Jaime and the team. We're not doing a road show as is normal on the Q1, but if anybody has any queries, please fire them into Jaime. If you want to come visit us at some stage over the summer, please feel free to do so, as long as you're flying with Ryanair and not one of our competitors, you'll be very welcome. Thank you very much, everybody, and we'll all go back to work now.
Unknown Executive: Thank you. Bye-bye.