Ryanair reports profit, says max boost a year away

Ryanair Holdings Plc said demand for air travel within Europe could receive an unlikely boost if the Chinese coronavirus epidemic persists, prompting people to holiday closer to home.

Trends from 2003, when travelers shunned Asia after the Severe Acute Respiratory Syndrome outbreak, suggest consumers may begin to alter their travel habits, Ryanair Chief Financial Officer Neil Sorahan said in an interview.

“People tended to stay close to home,” Sorahan told Bloomberg Television on Monday. “They holidayed in Europe as opposed to heading as far afield as Asia and elsewhere.”

The coronavirus that originated in Wuhan last month has killed more than 360 people and infected 17,000. Dozens of nations and airlines are restricting travel, with almost 10,000 flights canceled through Jan. 31, according to data provider Cirium, even though the World Health Organization has so far said that such limits aren’t needed to control the spread.

SARS affected 26 countries, resulting in close to 800 deaths from about 8,000 cases, according to the WHO. Fitch Group said Monday that a prolonged outbreak of the coronavirus would weigh on the tourist economy in Thailand, affecting not only Chinese demand but travel from elsewhere. As of Monday the Southeast Asian country had 19 confirmed cases, Fitch said.

For Ryanair, a surge in European travel would bolster margins as it grapples with the grounding of Boeing Co.’s 737 Max jet. The discount giant reaffirmed that deliveries from a 200-strong order won’t commence until September or October, so that fuel-efficiency savings won’t be realized until late in the fiscal year starting in April.

Europe’s biggest low-cost airline posted net income of 88 million euros ($98 million) for the third quarter through December from a year-ago loss, aided by last-minute sales over the Christmas holidays. Bookings are 1% up on last year, with planes 96% full, so an increase in regional travel would push up fares.

Ryanair shares were trading 3.6% higher at 15.43 euros as of 8:07 a.m. in Dublin, where the company is based.