Earlier this year, Ryanair agreed to buy Austrian holiday airline Laudamotion. On Monday, Ryanair announced that it expects Laudamotion to report annual losses of 150 million euros (£133.92 million), which is higher than the previously estimated 100 million euros.
Ryanair, an Irish airline, also mentioned that it plans to increase its ownership stake in Laudamotion from 25 percent to 75 percent in the coming weeks, pending regulatory approval. The increased loss is attributed to factors such as lower-than-expected summer fares, which were caused by the late release of Laudamotion’s summer schedules.
Neil Sorohan, Ryanair’s Chief Financial Officer, noted that Laudamotion will release its schedules much earlier next year, which should prevent issues related to last-minute discounting. He added that Ryanair will assist Laudamotion with fuel hedging, and he expects the airline to break even by the end of the third year.
Sorohan also mentioned that while Ryanair is open to other acquisition opportunities, the company primarily focuses on organic growth. Laudamotion has been facing significant cost challenges related to fuel, as it does not engage in fuel hedging, according to Ryanair’s financial statement for the three months ending June 30.