Ryanair posts first loss in 20 years

Ryanair posted its first full-year loss in two decades and disappointed investors with its outlook yesterday, despite the Irish carrier being one of the few airlines forecasting a profitable year ahead.

While rivals shrink in the face of falling demand, Ryanair is hoping to mop up business from cost-conscious travellers during the global recession, and its chief executive officer said it was even casting the slide rule over Deutsche Lufthansa.

"We are having a serious look at Lufthansa. We could almost buy it for cash," Michael O'Leary told a news conference in London.

"We are not planning any bids for Lufthansa in the foreseeable future but it is the only one of the other three large airlines that we would be interested in."

Shares in Lufthansa, whose market capitalisation of around €4.5 billion is €800 million less than Ryanair's value, were up two per cent at €10.25 at 1100 GMT.

Ryanair was trading up 0.3 per cent, underperforming a five per cent stronger Irish market after its 2009-10 outlook was less ambitious than expected.

"The numbers for the year just finished are obviously ahead of market expectations but the guidance he has given for March 2010 seems to be below what analysts had thought in their models up till now," a Dublin-based trader said.

"Basically we had been looking for net profit of somewhere around the high 300s and now (Michael) O'Leary is guiding somewhere between 200 and 300 so there is 100 million of a difference somewhere along the line."

Europe's biggest low-cost carrier wrote €222.5 million off its near 30 per cent stake in Irish airline Aer Lingus, resulting in a net loss of €169.2 million.

Before booking the loss, Ryanair's adjusted full-year net profit of €105 million came in well ahead of expectations and it said it planned to at least double that this fiscal year.

By contrast, British Airways has said tough conditions made it impossible to give guidance and it was facing a "fight for survival".