Tag: cost (Page 16 of 16)

Ryanair, CEO Suit Filed In U.S. Court

November 7, 2018 / WIL BALDWIN

NEW YORK (Reuters) – Ryanair Holdings Plc (RYA.I) and longtime Chief Executive Michael O’Leary have been sued in New York by a shareholder that said Europe’s largest airline defrauded investors and inflated its share price by overstating its ability to manage labour relations and keep costs down.

The complaint was filed on Tuesday night in the U.S. District Court in Manhattan by an Alabama pension fund, seeking class-action status and damages for investors in Ryanair’s American depositary shares from May 30, 2017 to Sept. 28, 2018.

Ryanair did not immediately respond on Wednesday to requests for comment.

The complaint said Ryanair misled investors in regulatory filings and conference calls about its labour stability, including “industry leading” contracts with pilots and cabin crews, and its positive impact on operations.

It said the truth came out as labour unrest forced the Dublin-based low-cost carrier last December to recognise unions for the first time, and led this summer to costly strikes that stranded thousands of passengers in several countries.

“Unbeknownst to investors, the company’s historical profit growth was built on an undisclosed and unsustainable foundation of worker exploitation and employee turnover,” the complaint said. “The decline in the price of Ryanair ADSs was the direct result of the nature and extent of defendants’ fraud finally being revealed to investors and the market.”

Ryanair cited labour issues on Oct. 1, when it cut its full-year profit forecast. Its share price closed that day more than one-third below its level in mid-March.

O’Leary, Ryanair’s chief executive since 1994, said last month he hoped to reach labour agreements with all of the carrier’s major unions before Christmas.

ADSs on June 30 accounted for 43.7 percent of Ryanair’s issued ordinary shares, assuming all were converted into ordinary shares, the company has said. Ryanair’s market value is roughly $16 billion, according to Refinitiv data.

The lawsuit was filed by the City of Birmingham Firemen’s and Policemen’s Supplemental Pension System. Its law firm Robbins Geller Rudman & Dowd specializes in securities fraud.

It is common for shareholders to sue companies in the United States after what they consider unexpected share price declines.

The case is City of Birmingham Firemen’s and Policemen’s Supplemental Pension System v Ryanair Holdings Plc, U.S. District Court, Southern District of New York, No. 18-10330.

(Reporting by Jonathan Stempel in New York; editing by Bill Berkrot)

Low-Cost Viva Air Looks To Expand In South America

November 2, 2018 / WIL BALDWIN

BOGOTA, Nov 2 (Reuters) – Low-cost airline Viva Air, which operates in Colombia and Peru, is looking to expand its operations to a third country in 2020, its chief executive officer said late on Thursday.

The airline, owned by Irelandia Aviation LLC of Dublin , is spending $5.2 billion to buy 50 Airbus planes which it hopes will help make it the top low-cost carrier in Latin America, chief executive Felix Antelo said at an event in Bogota. It has already obtained seven of those planes.

“Our bases are Colombia and Peru. We’re looking at a third country that we can’t name. In 2019 consolidating Colombia and Peru will be the focus and from 2020 onward we could see a third country,” Antelo said.

Viva Air operates 32 routes in Colombia, Peru and to destinations including Miami with 19 planes and 800 employees.

It will have served 4 million passengers in Colombia and 900,000 in Peru by the end of the year, Antelo said, adding fares within Colombia can be as low as $10 including taxes.

Irelandia Aviation’s low-cost carriers – including Europe’s Ryanair, Asia’s Tiger Airways, Allegiant in the United States and Mexico’s VivaAerobus, have transported more than a billion people.

(Reporting by Luis Jaime Acosta Writing by Julia Symmes Cobb; Editing by David Gregorio)

Image from Airbus

Is American Airlines Recession Proof?

October 22, 2018 / WIL BALDWIN

In recent years, American Airlines (NASDAQ: AAL) CEO Doug Parker has been one of the most vocal advocates of the idea that industry consolidation has permanently transformed the U.S. airline business. Whereas airlines have historically lost huge sums of money during periodic industry busts, Parker has boasted that American Airlines will never lose money again.

Yet on the surface, management’s optimistic outlook seems to clash with a trajectory of declining profits at American Airlines. If the company is struggling to maintain its profitability in a robust economy, one could reasonably wonder how it would do in an economic downturn. Indeed, American Airlines stock is down 38% year to date, so investors clearly are skeptical.

Click the link below for the full story!

Is American Airlines Recession Proof?

Ryanair Hopes To Close Union Deals By Christmas

October 22, 2018 / WIL BALDWIN

DUBLIN (Reuters) – Ryanair (RYA.I) hopes to reach deals with all of its major unions by Christmas, its chief executive said on Monday, in a sign an end may be in sight to disruptions which have hit its profit and shares.

The Irish low-cost carrier, Europe’s largest, on Monday reported a 7 percent fall in profits in the six months to Sept. 30 on high fuel costs and intense competition.

But it said these factors were helping it to resolve its industrial relations troubles.

“Given the adverse environment that’s out there for airlines and the number of job losses being reported in recent weeks both by pilots and cabin crew, there is a much more sensible, common sense approach being taken by the unions,” Chief Executive Michael O’Leary said in a video presentation.

O’Leary said that recent progress in talks left Germany and Belgium as the only two large markets for the airline where recognition agreements had not been secured.

“We would be hopeful of concluding agreements with them this side of Christmas,” he added.

The fall in profit was less than the 9 percent drop forecast by analysts and Ryanair shares were 4.2 percent higher at 12.00 euros at 1100 GMT.

Ryanair’s shares are almost 40 percent down from a peak of 19.39 euros in August last year before the industrial relations issues began.

A staff revolt forced management to recognise unions for the first time last December and the airline has since struggled to put in place union recognition agreements.

A spokesman for Belgium’s LBC-NVK union said it was waiting for an offer from Ryanair on Thursday and had warned the airline they could strike again if there is no progress.

A spokesman for German unions VC said he saw “no real progress” in talks with Ryanair, which also needs to secure recognition deals in the Netherlands and Sweden.

On Friday it said it had reached agreement with British, Portuguese and Italian pilots and was close to a deal with Spanish pilots, although the British union said the deal had not been approved by its members yet.

Ryanair issued a profit warning on Oct. 1 citing damage to bookings from strikes and cutting its forecast for full-year profit by 12 percent.

But on Monday, O’Leary said much of the weakness of recent weeks was sector-wide rather than specific to Ryanair.

Over-capacity in European short-haul will push Ryanair fares down by 2 percent in the six months to March 31 compared to the same period last year, O’Leary forecast. He warned he would not rule out a 3 percent fall.

“We are entering into a grim winter in terms of declining air fares,” he told an analyst conference call. “But moving into the summer of 2019 I would expect to see some upward traction on pricing… following oil prices with a 12-month lag.”

Ryanair, which makes most of its profit in the summer, reported a profit of 1.2 billion euros ($1.38 billion) in the six months to Sept. 30, better than the 1.127 billion euros forecast in a company poll of more than 10 analysts.

($1 = 0.8685 euros)

(Additional reporting by Ilona Wissenbach and Daphne Psaledakis; Editing by Amrutha Gayathri and Alexander Smith)

Image from https://www.ryanair.com/us/en/

Ryanair, CEO Suit Filed In U.S. Court

Low-Cost Viva Air Looks To Expand In South America

Is American Airlines Recession Proof?

Ryanair Hopes To Close Union Deals By Christmas

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