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Oct 31 2017, 07:30 GMT
Ryanair’s rostering failure is not without cost – €25m in non-recurring EU261 costs and €45m in FY2018 crew costs (up to €100m in a full year). However, management is dealing with this head-on and we believe the winning business model endures – unchanged FY2018 guidance of net profit of €1.4-1.45bn, helped by average fares falling -4 to -6% (previously guided -5% to -7%) and ancillaries per passenger up 1% (previously guided flat). Our forecasts are likely to go to the bottom end of the range for FY2018 and we expect broadly flattish net earnings for FY2019 given fuel headwinds. We see no reason to change our ‘Outperform’ rating and 12-month €20.0 price target.