Rainier earnings Q22020

LONDON – Rainier said on Monday it would run a “significantly reduced flying schedule” over the next six months compared to its original expectations as European governments tightened social sanctions.

The statement comes just two days after the UK government announced a second lockdown in England since November, with the French and German governments also pushing for plans for a second nationwide lockdown last week. Meanwhile, many governments in Europe have also stepped up controls over the past few days, plagued by another wave of coronavirus infections.

“The WHO (World Health Organization) itself has confirmed that lockdown should be the last resort. Lockdown is essentially a failure,” Michael O’Leary, CEO of Rainier, told CNBC’s “Squawk Europe x Europe” on Monday.

“If we had a provision for more aggressive testing and tracing, or (as the Prime Minister of the UK), Boris Johnson promised world-class testing and tracing, which is clearly not in the UK, we could have avoided another lockdown,” O’Leary added.

This has hit budget airlines hard with stay-at-home orders Nationwide epidemic of corona virus. The company reported a 78% decline in revenue on Monday between April and September compared to a year ago. Rainier also saw an 80% drop in customer numbers in those six months.

“It’s clear that air travel is at the forefront of this epidemic … and we think the only way out is with the governments, the British, the Irish and other European governments, who introduced the pre-departure test,” O’Leary told CNBC.

Behind the latest sanctions in Europe, Rainier expects fewer flights to go ahead.

“We expect the potential of intra-European air travel to remain unchanged for the next few years,” Rainier said in a statement.

O’Leary added that “this will be the main volume of essential travel this winter, but basically we’re talking about numbers that are less than a third of our usual.”

However, the firm believes the crisis will also create “going forward” opportunities such as an increase in its fleet and lower airport costs.

Other Highlights of the Year:

• A net loss of 197 million euros compared to a profit of 1.15 billion euros a year ago.
• Rating operating costs fell 67% from a year ago to 1.35 billion euros.
• The load factor has risen to 72% from 96% a year ago.

Shares of Rainier have been down about 19% since the beginning of the year.