Virus second wave may stall travel recovery, Ryanair warns

Bloomberg

Ryanair Holdings Plc issued a stark assessment of the threat to airlines as they seek to rebound from the coronavirus crisis, saying it’s concerned that a series of local lockdowns followed by a second wave of infection will hold back the recovery from the pandemic.
Ryanair kicked off earnings season for European carriers on Monday by posting a loss for the June quarter and saying it will lose money through the rest of the summer. While the restart of flights presents opportunities, the discount giant said it’s worried the virus could continue to roil demand for months to come.
“A second wave of Covid-19 cases across Europe in late autumn, when the annual flu season commences, is our biggest fear right now,” the Irish company said.
Britain’s surprise reintroduction of a quarantine for people arriving from Spain threatens to quell resurgent demand at carriers like Ryanair that are heavily reliant on holiday traffic, and shows how the industry is treading a tightrope as it resumes flying with the virus still raging. The company said the situation could be further compounded by “adverse trading consequences” if the UK completes its exit the European Union without a trade deal in January.
Shares of Ryanair, which deploys 4% of group-wide capacity on UK-Spain flights, according to Citigroup analyst Mark Manduca, fell 2.8% as of 8:01 in Dublin, while Luton, England-based EasyJet Plc, which has 5% of its seats in that market, was down 12%. Jet2 owner Dart Group Plc was 8.9% lower and package-holiday operator TUI AG was off 7.5%.
IAG SA, which owns British Airways Spanish network operator Iberia, lost 7.7%.
Ryanair, which predicted air travel will remain depressed for two or three years at least, had a loss of 185 million euros ($217 million) in the fiscal first quarter, when its jets were largely idled and the customer count fell 99%.
While that’s better than the 200 million euro-loss that the company forecast in May, the International Air Transport Association, among other trade groups, sees the crisis persisting for longer than first forecast, with bigger overall losses.