Hello, and welcome to the Ryanair FY22 results conference call. Throughout the call, all participants will be in listen only mode, and afterwards there'll be a question and answer session. During the Q&A, in the interest of time and fairness, please limit yourselves to two questions per person. Just to remind you, this conference call is being recorded. Today, I am pleased to present Group CEO, Michael O'Leary. Please go ahead with your meeting.
Okay. Good morning, ladies and gentlemen. You're very welcome to Ryanair full year results investor conference call. I'm here in London with many of our teams, Eddie Wilson, Neil Sorahan, David O'Brien, CEO of Malta Air. Neil Sorahan, Tracey McCann, Peter Larkin are on from various different points. We have an extensive roadshow in place across Ireland, the U.K., Europe, and in the States this week. If you'd like a meeting, please let us know. Contact us through Peter Larkin and the investor team. You've seen we issued the press release this morning. There's been a comprehensive Q&A up on the website, so I'd refer you all to ryanair.com, and while you're there, make a booking.
With a couple of quick themes for this morning. I think we're a bit more cautious than many other airline competitors that have been out in recent weeks. There's no doubt that there is a strong recovery underway at the moment. I would characterize that recovery as Q1. We are back up at kind of 90% load factors. We hit 90% load factor in April for the first month since COVID that we got above 90%. Pricing is a little bit softer into Q1. That is the April-May-June quarter. Most of that I would blame on the Ukraine invasion or the Russian invasion of Ukraine the last week of February.
Easter looked like it was going to be very strong, and it kind of fell over because bookings plummeted for about four or five weeks following the Ukraine invasion. That has affected pricing into April, May. There's a reasonable recovery into June, but nevertheless pricing. There'll be a strong traffic recovery in Q1, but pricing, I think, will be down maybe modest single-digit % on where we were pre-COVID. Q2 at the moment, and our forward bookings are running about 10% behind where they were for this date for Q2 pre-COVID. Pricing looks stronger. We expect to see load factors return to the low to mid-90% into Q2. That's the July-August-September quarter. Pricing at this point in time looks like it'll be modest single digit above where it was pre-COVID. We're slightly concerned at the risk.
The risk is to the downside. If there's any negative news flow, either on COVID or on Ukraine or Icelandic volcanic ash, you know, that could fall over again, and we're kind of scarred with the experience we had with Omicron, which kind of damaged Christmas at short notice, Ukraine, which damaged Easter at short notice. Generally speaking, we think the summer will be reasonably strong as long as there is no adverse news flow out of COVID or out of Ukraine. We then, though, move forward into the two winter quarters, the December and the March quarter, and we have very little visibility into those two quarters. There's a general view that there will be a you know significant economic downturn, if not recession, across most of the U.K. and Europe in the second half of this year.
Ryanair is poised, I believe, to do very well if there is a recession. We are by some distance, the lowest cost producer and the lowest price offer operator in Europe. In a recession, the low cost providers, whether it's Primark, IKEA, Lidl in the supermarkets or Ryanair in air travel, will do better. People will fly, but they will trade down from the higher cost providers to Ryanair. Because we have so little visibility in the second half of the year, we're not willing to give a guide or a guidance on full year profitability at this time. We've said we can say no more than we expect to be a modest profit recovery. We're not sure whether we'll get back to pre-COVID profitability, which will be something north of around EUR 1 billion after tax.
We should have a reasonably strong first half of the year, but it all depends how much of what the losses will be in the second half of the year. Those are the fundamental drivers of the business for the next twelve months. Around that, we are taking delivery of just over 70 new game changer aircraft this summer. Unlike almost every other airline, we will operate at 115% of our pre-COVID capacity through this summer. Major expansions of capacity in markets in Dublin, where there's a COVID recovery scheme in Italy, where now ITA's reduced capacity in Portugal, in Vienna, where we've seen off most of the other kind of low-fare competitors in the last number of years.
It's essentially Lauda or Ryanair and Austrian Airlines, and in Central and Eastern European markets as well, where we're seeing very large market share gains in Hungary and Poland, in Romania and in others. We're also very fortunate that for the next 12 months we're very well hedged on fuel. I would describe that more to dumb luck than supremely intelligent management. Nevertheless, we have 80% of our fuel purchased forward out to March 2023 at less than $70 per barrel. We are unhedged on the remaining 20%, and that will be a cost challenge through the next four quarters. Nevertheless, we're in a much stronger position on fuel hedging than any other airline in Europe.
We've a combination of new aircraft capacity burning 14% less, 16% less fuel, very well hedged on oil. We have a lot of really good airport deals done. We're opening 15 new bases and more than 700 new routes. We believe that we are poised to be the major beneficiary from the post-COVID recovery. We caution at this stage that that recovery is fragile, and it is exposed to adverse news flows. We continue to perform well. We're very proud of our continuing commitment to our environmental strategy and also our social strategy. On the environment, we're pleased that CDP has improved our climate protection rating from a B- to a B.
We're well on track, we believe, to get to an 'A' rating within the next two years. We're industry-leading in terms of our. There's no other airline rated higher than a 'B' in Europe. We're very pleased with Sustainalytics recently upgraded Ryanair. We're the number one ESG airline in Europe, number two in the world, and we continue to invest heavily, not just in our environmental programs, but also in our social and governance programs as well. Labor has been an issue for a number of our competitors in recent months. I think we have been the beneficiary of some of the decision-making we made during COVID. We committed to all of our pilots and our cabin crew that we would not make them redundant during COVID.
We kept them employed. We did participate in furlough or in the kind of employment support schemes. What was critical is that we kept our pilots and cabin crew current. We kept them all flying at least once a month. We kept them current, we kept them employed, and that means that we're not seeing the same employment pinch points as a number of our competitors here in the U.K. who are short of cabin crew and are either cutting flights or are taking seats out of their aircraft. We have enough pilots and cabin crew to get us through the summer.
It is tight in the U.K. because of the very inflexible labor market post COVID, but we're in reasonably good shape, and we expect to operate all of that capacity through the summer. Much more flexible labor markets in Europe. Again, we have more than 1,000 cadet pilots being trained at the moment and more than 2,000 cabin crew going through recruitment and training programs, not just for this summer, but also into the winter. We're looking forward next winter to taking delivery of another 55 Boeing 737 MAX aircraft, as long as Boeing can deliver them, and the jury is out on whether Boeing will be able to deliver those aircraft next winter.
That would gear us up well for growth to 185 million passengers through the summer of 2023, and into fiscal year end March 2024. I've seen a number of reports out recently from analysts who should know better, questioning the business model and the exposure to higher oil prices into FY24. If oil prices remain at these elevated levels, you're going to see fuel surcharges from Europe's legacy airlines this year. You'll also see significant fuel or airfare increases from airlines around Europe who are either unhedged or who are in inferior hedge positions to Ryanair. A lot of those airlines are withdrawing capacity for where they compete with us. I mean, BA last week announced 100 fewer daily flights, mainly on market, short-haul markets, U.K., Italy, U.K., Spain, because of labor tightness.
You know, I think that's an understandable and a sensible move, but it does play to our business strategy over the next 12-15 months. To those analysts who are out there kind of, "Oh, well, oil might be higher in the summer of 2023," it may well be higher in the summer of 2023, but if it is, airfares will be significantly higher as well, and we're poised to be, I think one of the main beneficiaries of higher airfares into summer of 2023. I think for the moment, our investment, we're investing heavily in our people. We've had significant progress. As you know, we engaged in pay cuts with most of our pilots and cabin crew.
We have scored some successes in recent weeks and recent months. We've been engaging in pay restoration negotiations with pilots and cabin crew. I'd say at about 1/3 or 40%, 30% or 40% of our EU markets, we've agreed pay restorations where we're trying to bring forward those pay cuts.
We're bringing forward both the timing from July to April or May, and also instead of restoring 20% pay cuts at the rate of 6%-8% over the next three years, we're inverting it and bringing it forward to 10% this year, 6% next year, 4% the following year, with a commitment that if we get back to pre-COVID profitability this year, we'll combine that 6% and 4% pay restoration over the next two years and bring it forward to July 2023. We remain committed to restoring the pay of our people as soon as our business returns to pre-COVID volumes and profitability. There are some unrealistic expectations out there around Europe that, you know, "Oh, COVID's over, give us back our money." COVID is not yet over. It's not yet.
That's reflected in both our load factors and in our airfares, I think, for the foreseeable future. We're very hopeful that the industry will not suffer any negative news flows and that we will see a strong post-COVID recovery maybe over the next 12 or 15 months. We've committed in our negotiations with our people and their unions that if we recover to pre-COVID levels, we will restore the pay to pre-COVID levels, but only as profitability is restored. I think with that, I'm gonna ask Eddie Wilson, just the CEO of DAC. Eddie, any additional comments you'd like to give us in terms of color? Then hand to Neil Sorahan for something on the balance sheet and on the finances. Eddie?
Yeah, I think the big call-out here is the growth in market shares, and that's built off our leveraging operational resilience because we kept all of our pilots and cabin crew employed. You know, we were able to open 15 bases this year, and again, leveraging off the low-cost deals and growth deals that we did at most of our major hubs.
Which actually puts us in a good position to grow not only this summer but into next summer as well, where we will continue to be opportunistic. With no difficulty in terms of you know we've already sort of inked out exactly where those aircraft are gonna go for next summer. Obviously, we haven't communicated that to airports, but again, it'll be opportunistic. It is they'll be done off sort of low-cost deals within. I mean, the real call-outs on market share are places like Italy, where we're up at 40% with again poor sort of incumbent carriers there in terms of ITA. Spain has done particularly well for us as well.
I think it's indicative of Ryanair really being the only show in town in terms of growth in, particularly in tourism economies of Southern Europe. We were at a recent event in Spain with government ministers in attendance where, you know, Ryanair's contributing 1.2% of Spanish GDP. We're contributing EUR 15 billion in terms of tourist spend. Increasingly, we're seeing governments who are trying to restore their tourist economies, in particular, only looking to Ryanair. We're the only ones that have the aircraft coming. Another 55 next year as part of the 210 aircraft order. Costs are in place at the airports. Michael has touched on the union deals that we're doing at the moment. Clearly, our people there have been through a lot of pain over the last two years.
What has happened there is that at least we've kept everybody employed. I think the difficulties that we saw at early stages of COVID, where we actually, you know, to keep people current, was a huge task when we were flying very few passengers. We can only imagine what our competitors are going through at the moment as they try to use scarce training resources while passenger numbers are building. We will continue to work with the unions and our people in restoring that pay, and we hope that, you know, that we will get, that will cross over in terms of return, profitability returning and pay restoration.
Okay. Thanks, Eddie. Neil, you might just touch briefly on the balance sheet and I think also CapEx for the next 12 months because it'll be caught in the Q&A.
Sure. Yeah, it's an obvious question. Yeah. The balance sheet, we've had good progress over the course of the past year. We've finished with EUR 3.6 billion in cash. Despite EUR 1.2 billion CapEx in the year just ended, very pleased that we saw our net debt position reduced from EUR 2.3 billion to just under EUR 1.5 billion. Over the next couple of years, we're into a peak CapEx period. We expect to have about EUR 2.3 billion in CapEx in the current financial year. That'll dip marginally down to about EUR 2.1 billion-EUR 2.2 billion, the year after that. Our objective over the next two years will be to manage down the net debt position on the balance sheet to a broadly net cash net debt position over a two-year period.
Good. Okay. With that, thanks, Neil. We'll open up for Q&A, please. We are reasonably tight for time because we've got to be out of here at 11 o'clock. If we, you know, two-part questions, and we'll keep it as zippy as we can.
Thank you. Once again, if you wish to ask a question, please dial zero one on your telephone keypad. If you find your question is answered, you can cancel with zero two. Our first question comes from the line of Jaime Rowbotham at Deutsche Bank. Please go ahead. Your line is open.
Jaime, hi.
Morning, Michael. Last month at Airlines for Europe, you were hopefully accurately quoted saying you'd be disappointed not to do somewhere north of EUR 1 billion in profits in the next 12 months. It sounds like we should interpret today's outlook as more cautious. Is that simply because of all the macroeconomic warnings you're reading about, or is it also due to tangible changes in the data you've started to see in the last four weeks? Second one, would it be fair to say you think better demand for summer beach destinations than for city breaks and linked to that, you know, when we think about competition out of Stansted. Do you think we're in the sort of environment where the kind of package holidays that Jet2 can offer could start to be quite a material advantage to them?
If I may just an observation on the CDP ranking. Is there a reason you leave off IAG, who I think have an 'A-' rating? Thanks very much.
Okay, thanks. Firstly, you know, I was misquoted at Airlines for Europe. I said, what I hope for and what is not a forecast nor is it guidance. That was also what I would say again today. You know, I hope in the next 12 months we will see a restoration of profits back to pre-COVID levels, that should be somewhere north of EUR 1 billion. What I hope for and what I get are two different things. I think there's a reasonable prospect of a strong profit recovery in the first two quarters of this year. That can, you know, and I keep coming back to the point, it is fragile.
If there is negative news flow on Ukraine or COVID or anything else between now and June, July, the school holidays, you know, that falls over again, as it did at Christmas and it did at Easter. If we got a fair run, we could well get back to pre-COVID levels of profitability. I would also be, you know, I think there's a much greater risk of, you know, an adverse COVID variant as we move into the winter. You see the COVID situation in China is not, you know, if there's another variant out there could be a vaccine-resistant variant. It's, we have to be very cautious about what the second half of the year looks like. We may also be dealing with a recession in the second half of the year.
We are expanding our capacity, you know, meaningfully. We're running a 15% capacity expansion this summer. That will continue through the winter. In fact, we may step up our expansion during the winter to take advantage of airport incentives that will be improved certainly during the winter period and in the run into summer of 2023.
Look, I think it's reasonable and we've done our best this morning. We're saying, you know, what's our outlook on profitability for the next 12 months? We expect modest profitability. It could be significantly better than that. I don't think we're looking at a loss in the next 12 months. I think modest profitability. The real challenge for us is could we give you a range of profitability outcomes that we would be able to, willing to stick to? The honest answer to that is I can't. It could be something significantly north of EUR 1 billion, it could be something significantly south of EUR 1 billion.
Until we get through the first half of the year and have some better visibility into the second half of the year, and that probably won't be until the half year numbers at the end of October, so we really can't give you any accurate range. Is demand better for the beach than the cities? No. I mean, we've seen a very strong recovery in business traffic in the last quarter in recent months. People repairing their supply chains, focusing more on European supply. There is no doubt in my mind, though, that the beach demand for European beaches is very strong in the second quarter. The only reason, you know, if you take the city kind of traffic, a lot of that is we have a very large domestic operation in Spain.
We have a very large domestic operation in Italy. We have a large domestic operation, you know, within the U.K.. A lot of that just books up. Well, not so much the U.K., but a lot of that just, I mean, Ireland, U.K.. A lot of that books later. You know, it doesn't book two, three months in advance. That marketplace is still, you know, will still be running behind the average system-wide forward bookings. We do expect it to book strongly and it will book late, and it will pay slightly more.
It is also subject to falling off if there's, as it did at the end of February, I mean, we saw our bookings fall off by, you know, we lost about 1 million bookings during the last week of February, the first couple of weeks of March just because of the Ukraine invasion. It's very hard to recapture those bookings. If people don't make those short-term decisions to book, well, then we don't see them. I think we're looking. I mean, again, I think it's a reasonably accurate guidance we give you. Traffic will be strong in Q1, but at prices that will be, I think, modest single-digit behind pre-COVID pricing. Traffic, I think based on what we know, though, will be strong in Q2 at pricing that will be mid-single-digit above pre-COVID pricing. We have no visibility on Q3 and Q4. Next question, please.
Thank you. The next question comes from the line of Savanthi Syth at Raymond James. Please go ahead. You're on line, Savanthi.
Good morning.
Hey. Good morning. Just I was wondering if you could talk about, you know, what you're seeing in terms of the uptake on the various ancillary revenue purchases. Namely, you know, are you seeing any changes as demand picks up here, and what your expectations are for at least kind of the first half of this year? And then for my second question, you mentioned, you know, taking more MAX aircraft in the summer and even over the winter having possibly an aggressive plan, but your kind of passenger targets haven't changed. Is that just a reflection of the uncertainty or are you planning to kinda retire more aircrafts there? Net aircraft is not that different.
Okay. I'll ask Eddie just to give you a quick insight on ancillaries, then I'll deal with the MAX aircraft and passenger numbers. Eddie?
Yeah. I think on ancillary revenues, you know, like the three main pillars we have are the bundles, seats, and priority boarding and bags. We are well advanced on priority boarding in terms of dynamic pricing, and we're still quite crude on some of the other tools that we have in terms of managing bags in particular and the relationships within those, and also the relationships within control groups within different markets and different itinerary types. I would say, like, it returns strongly as passenger numbers return on particular load factors, particularly for priority boarding. I would see that getting more sophisticated. I think, you know, ancillaries are quite strong, and resilient, and I think we're gonna be able to build on those as we put in a dynamic pricing model. I think there's some way still to go on this.
Don't forget the duty-free, which is building. Duty-free sales are building on all of the U.K. routes to and from the U.K.. On MAX aircraft, we're gonna take 67-73 MAX aircraft this summer. That's if Boeing actually delivered them to us. We're still struggling with Boeing's delivery issues. That's 73 aircraft against an original forecast of 65 aircraft. Like, ultimately, you know, we would try to accelerate the timing of those deliveries over the next four or five years. Ultimately, the order number is still 210 aircraft. It doesn't fundamentally alter the ambition, which is to grow traffic by 50% to 225 million passengers by FY26. That stays in place. There is no significant movement between the years in that.
We have been, you know, we've made no progress at Boeing on the follow on MAX order. You know, the management of Boeing and Seattle is very poor. I would, you know, I've noticed some commentary from the leasing industry recently that, you know, that the Boeing and Babcock said it was not entirely complimentary of Boeing management on the civil aircraft side. I would wholeheartedly endorse that. I think they're losing market share hand over fist to Airbus and don't seem to be responding appropriately. Moving the headquarters to Virginia from Chicago, while it may be good for the defense side of the business, doesn't fix the fundamental underlying problems on the civilian aircraft side in Seattle. Seattle needs a reboot. It needs a reboot quickly.
Nevertheless, we have an RFP out there for up to 50 secondhand aircraft. We're looking at secondhand Airbus and 737 aircraft. I think we've been impressed with the pricing that's available at the moment, and we may do something. I think in addition more aircraft over the next couple of years. We may look to the secondhand leasing market where there's opportunities to do so. That might, around the edges, accelerate traffic growth through FY24 to FY25, if we could secure a package of between 30 and 50 additional secondhand aircraft. That's if Boeing don't step up with some additional orders. At the moment, we think the Boeing management are running around like headless chickens, not able to sell aircraft.
Then even the aircraft they've delivered, they're not able to deliver them on time, which is disappointing. We keep working with them, you know, we're their largest customer, but they need a reboot or a boot up the arse somewhere in Seattle. Hopefully, Calhoun will deliver it. Next question, please.
That's from the line of Duane Pfennigwerth at Evercore ISI. Go ahead.
Duane, hi.
Hey, thanks. Good morning. Can you comment on the capacity outlook you see intra-Europe? Any surprises with fuel at these levels? How do you see the summer playing out from an industry capacity perspective?
Yeah, I mean, we've long had the view that, you know, the short-haul EU capacity will be down between 10%-15% this summer. I think I would hold to that. It may be towards the lower end of that. It's closer maybe to 10% than 15%, but it's continuing to evolve. We see huge capacity taken out, I mean, the headlines would be like Norwegian's capacity is down about 60% on where it was pre-COVID. Alitalia is down 50%. TAP in Portugal down about 30%. Thomas Cook, Flybe, all those guys have disappeared. There's also significant labor shortages in the U.K. I mean, we've seen that in recent weeks play out with BA announcing cutting about 100 daily flights from its short-haul flying program.
Mainly U.K.-Spain and U.K.-Italy, where they try to go where they're competing with Ryanair. easyJet has come up with a remarkable initiative now of taking seats out of the planes to try to reduce the labor or to address labor shortages there. Wizz continue to remove aircraft from Vienna, Central and Eastern Europe. We noticed there more recently they signed up a joint venture in Saudi Arabia. Maybe they're gonna send their aircraft to Saudi Arabia, where I would be reasonably confident they won't have to compete with Ryanair. They can take more aircraft away from Western Europe, where they're not able to compete with Ryanair. I still think that European short-haul is likely to be down, I think a low double-digit percent this summer.
Into that market, we're growing by 15% over our pre-COVID volumes. As Eddie has said, like we are seeing enormous market share growth in markets, big markets like Italy, Portugal, Spain, Austria. Budapest, we're going to remarkably overtake Wizz this year in their home market, whereas the idea of Wizz arriving in Dublin and overtaking Ryanair won't happen in this lifetime or any other lifetime. I think that's what's driving what would appear to us to be reasonably strong pricing into the second quarter this year. How that's sustained into the winter period, I don't know.
I would certainly, I think we, as a group of airlines, would be talking to our airport partners about aggressive capacity growth into the winter, where we're taking delivery of new aircraft from Boeing. A large number of those airports are incentivizing us to accelerate our capacity growth into the winter with fairly significant and deep winter discounts, because the airports want to recover or recapture their pre-COVID traffic.
Thanks. Just for my follow-up.
Yeah.
Any commentary on your non-fuel unit cost, Michael? Specifically as we get back to pre-COVID capacity levels, you know, what sort of targets are you hoping for this year? Thanks for taking the questions.
Pleasure, Duane. Neil, you wanna take that?
Yeah, I'll take that, Michael. Duane, good morning. How are you? As you saw, Duane, last year, we saw a good reduction in unit cost down to EUR 35 . This year, we're starting to get load factors back over 90%. We're taking in the Boeing 737-8200. I would be hopeful that we start to track down towards the kind of EUR 31 per passenger that we would've seen pre-COVID. We'll start moving in that direction strongly, hopefully, over the next number of months.
Thank you.
Thanks, Neil. Next question, please.
That's Alex Irving at Bernstein.
Alex, hi.
Oh, I've got two on labor please. First on your own and then that of your suppliers. On your own labor, I mean, you've been very clear that pandemic pay reductions will be restored to pre-COVID levels as profitability returns, but I'm wondering whether that will be enough as inflation rises and unions seek to keep pace with the cost of living. Obviously, you've got a lot of restructuring in the mix relative to your pre-pandemic state too. How should we think about that developing over the next couple of years, please? Second is on your suppliers' labor as we ramp up capacity. Clearly, you've kept your own pilots and aircraft current, but are the airports and other service providers to Ryanair ready for this too? We've seen reports of challenges in hiring around airports in particular. How worried are you about this? Thank you.
Okay, thanks. I think to give you what we see at the moment, like the labor, the pay restoration has gone reasonably well. We are willing and we're in advanced negotiations with a number of the unions. We've agreed deals at about, let's say, 10, 12 of the EU countries where we employ pilots and cabin crew. In some cases, unions have moved faster. In some cases, the unions have moved slower. Where the unions have moved slower, we have made less progress. Will it be enough? I think it will. You know, fundamentally, we have reasonably high pay within Ryanair, both pilots and cabin crew. They're not kind of entry-level pay. We're not talking about retail or hospitality levels of pay. They're paid significantly more.
We don't have a lot of labor turnover at the moment, either on pilots or on cabin crew. We have seen others try to pinch some of our cabin crew, particularly in the U.K.. While we've lost one or two, really people seem much happier working for us now. I think they're aware of the way that some of our competitor airlines just dumped their people during COVID, whereas we didn't. We kept them employed and much more importantly, current. That's not to say. I think, you know, some of the deals we've already done. To give you a flavor, I mean, our pay cuts, if you take the kind of, the pilots were 20%.
It was 20% pay cuts for the last two years, and then the restoration was going to be six and eight over the next three years. Where we've done those pay restoration improvements, we've now agreed 10 this year. We're bringing that forward from July to April or May, depending on how fast the unions get deals done. It's now 10, six, four. It is significantly accelerated with an understanding there that if we get above pre-COVID profitability or north of EUR 1 billion in the next 12 months, the six and four will be accelerated to next year to 10%. You could get 10/10 and full restoration over the period of the next 12 or 15 months. Those are deals we're willing to do.
You know, we want to restore people's pay as quickly as we possibly can, as long as the business restores itself. I would put that in contrast with a low number of our competitors who have restored all the pay cuts that they did during COVID, but that's because they're short of labor and, you know, they sacked a load of their people and can't get them to come back to work or can't get them back to work at all. I think we're in a fundamentally better space. Across much of Europe, we are high pay employers in Spain and Italy and Portugal, and, you know, with almost no turnover of labor. There are pinch points there. I wouldn't underestimate how difficult it is to hire people and train them in places like the U.K., for example.
Again, I would point to Stansted, which is an area where we have reasonable labor stability. We are the largest air employer in Stansted, and we kept our people employed during COVID. We did use furlough schemes, but we did keep them employed during COVID, whereas competitors in Gatwick and Heathrow seem to just fire everybody, and then they're kinda surprised that they can't get them all to come back immediately now that the market is recovering. Supplier labor remains a challenge. We've seen pinch points, security in Berlin, security queues at Dublin Airport, check-in, security at Manchester. I would also, you know, the people who are filling the in-flight bars, the duty free, that kind of stuff there.
Where you have kind of low labor rates in those kind of frontline areas, yes, there have been pinch points there. Again, I would point to we worked kinda collaboratively with the bigger airport or bigger airport suppliers in Charleroi, in Stansted, in Bergamo, in Dublin. We are seeing less issues at those airports despite a very strong recovery. Remember, at those airports where Ryanair is operating, they're now operating at above pre-COVID traffic levels, whereas airports like Heathrow and Gatwick, they're still operating at below pre-COVID traffic levels. I think supplier labor will continue to be an issue. I think it'll get resolved pretty quickly in Europe because there's reasonable labor market flexibility and the ability to recruit people pretty quickly. The U.K. will continue to be very challenged.
The labor market is very inflexible post-Brexit. You can't bring in young Europeans. I smile, although with some disappointment at the number of ardent Brexiteers like Lord Wolfson in Next and Tim Martin in fucking Wetherspoons, who now are calling for en masse visa issues so that they can hire staff to run their businesses. It's a pity they didn't think of that when they were campaigning for the fucking Brexit two years ago. We are where we are. I think the U.K. will continue to be challenging. You know, the U.K., while we are seeing modest traffic growth for us in the U.K., mainly market share shifts from U.K. competitors to Ryanair.
Most of our growth is taking place in Continental Europe and in Ireland, where we still have reasonable labor flexibility and our suppliers have reasonable labor flexibility as well. Eddie, you want to add to that?
Yeah, I think just two points. I mean, the first one is that where we have completed deals with unions, we've also the incentive as well for them to deal with restoration is that we have agreed modest pay increases beyond there as well since.
In years, yeah. Four and five.
In years four and five as well, which you know gives the incentive for some of the unions to actually complete deals so they've got long-term stability on pay. Then the second thing I'd say is that anywhere where we have self-handling operations in the U.K., Poland and Spain, we've had no labor difficulties. Again, that is redolent of what we did with pilots and cabin crew. We were planning for the return from the 17th or 18th of March back in 2020. So we are seeing some labor shortages. But again, they are in third-party handlers.
To be fair to them, I would have some sympathy for easyJet and BA in that. You know, it is very difficult. I think they may have overdone the job cuts during COVID, but don't underestimate the extent of how difficult it is to recruit people here in the U.K., given the inflexibility of the labor market post-Brexit. It will continue to be a challenge not just for the airline industry, but for all businesses in the U.K., for the next number of years, until somebody in government wakes up to the fact that you're gonna have to have visas or beginning to attract more labor here in the U.K., if you're going to keep consumer prices down and not add to the recessionary environment by having, you know, dramatically increased pay because of scarce labor here in the U.K..
It's just another one of those damaging dividends that have been delivered by Brexit. We expect more of them here in the U.K.. Thankfully in continental Europe, I think the labor market is more flexible and more responsive. Next question, please.
That comes from the line of Sathish Sivakumar of Citigroup. Please go ahead.
Yeah. Sathish, hi.
Hi, Michael. Yeah. I've got two questions here. So firstly, on the ATC and airport related staff shortages, where do you see actually the biggest challenges within your network? Then the second one, on the pent-up demand, what are the implications are for a potential, say, summer holiday season extended beyond into late September and October? Do you see any, like, early signs in the bookings?
Okay, two quick answers. The biggest challenges at airports, I think the biggest one is the one where we don't operate, thankfully, is in Heathrow. The other ones in the U.K., it would be Gatwick, Manchester, and I think Bristol, there are significant labor challenges there. Other than that, I think the rest of the airport system in the U.K. is in reasonable shape. On the continent of Europe, we're seeing pinch points at, in Berlin Airport has been a challenge. Poland, although they, labor remains, a bit tight in Poland because they demand the economy is recovering so strongly.
You know, the entry-level labor that would be kind of doing baggage handling and check-in is attracted to the property market where it's on fire in Poland at the moment as well. Generally speaking, there's I think less issues around continental Europe, and they have a flexible labor supply of free movement to people across Europe. I think it would be addressed pretty quickly. I think the U.K. would be much more difficult and inflexible. I think the U.K. would be more challenging. Within the U.K., it'd be Manchester, Gatwick, Heathrow would be the ones we'd point to. Any chance that the summer holiday is being extended? I don't really think so. I mean, I think you're ultimately it's driven by school holidays. Children go back to school in September.
I think there will be probably. I would like to hope that there will still be strong demand and constrained capacity through September into October, but it's too early to say yet. We have very little visibility on bookings into October, November, December. I think there will be, you know, people will continue to fly. I think they will get more price-sensitive in the second half of the year, particularly if there's a recession or economic downturn in the U.K. and inflation will continue to be a challenge. But I would believe that Ryanair, as the lowest cost, lowest price provider, certainly in the air travel space, will continue to be a beneficiary of an economic downturn or recession.
Much the same way that Primark, Lidl or IKEA will continue to be a beneficiary of a recession in the U.K. and/or Europe over the next year or two.
Thanks, Michael. Yeah, that's very helpful.
Thanks very much. Next question, please.
That's James Hollins at BNP Paribas. Please go ahead.
James, hi.
Morning. Yeah, two from me. The first one's just on where you're seeing capacity reductions. I think you've pulled out some capacity at Lisbon. As we know, you pulled out of Frankfurt-Hahn. I was wondering as we look at sort of slot issues or pricing issues, maybe this is for Eddie, are there any other sort of key airports or, you know, any of the larger airports where either you're not getting deals done as you wanted and potentially we're looking at other capacity coming out? The second one is, I'm a little bit confused, which isn't uncommon. I'm a little bit confused on the fleet plans. I mean, you're ripping into Boeing, which is fair enough, but to me it looks like they've outperformed on deliveries ahead of the summer.
Is there anything in particular that's making you worried beyond the summer on deliveries? Just for clarification, is the 50 aircraft RFP, is that about accelerating the current guidance you have on the annual passenger numbers that are in the presentation? Thanks.
Okay. You guys sneaked in about five questions there, but let me come back quickly. We have very few capacity cuts anywhere other than there were three aircraft that we had in Lisbon for the winter. We couldn't get slots for those for the summer because TAP is allowed to block slots it won't use. I mean, in our overall environment, that's nothing. We reduced, we closed the Frankfurt Main base . It was down to five, four base. Five- based aircraft there. Some were redeployed to Frankfurt-Hahn, which is not a like for like development. I think there has been a trend of increasing airport costs in the German market for the last year or two, and we're very happy to redeploy those aircraft into markets like Italy, Poland, Slovakia and Central Europe, where we're taking significant market share from competitors.
Overall, this summer we'll operate 115% of pre-COVID capacity, and if we could take more aircraft from Boeing, we would. Moving on to Boeing. The challenge with Boeing at the moment has been the delay in the deliveries. We said to Boeing wanted to know early this year if they could deliver us more aircraft, which by the way, remember, they manufactured pre-COVID, before the MAX was grounded. Would we take them? The answer was yes. The challenge for us is we wanted all those aircraft delivered before the end of April, and we will probably only get the last of those deliveries in June, which, you know, it doesn't sound like a big deal except, you know, we already had those aircraft on sale in April, in May and in June for the summer schedule.
We've had to go back in because of really unexplained delivery delays for aircraft that were manufactured fucking two years ago. We've had to go back in and take out to short our capacity. Now, you wouldn't notice it in the overall, but simply because Boeing failed to meet their delivery commitments in mid-April and mid-May. We've had to take out a couple of 100,000 seats out of our summer schedule in April and in May, and we have to go back in about a week or two ago and take them out in June as well. It's probably cost us about 600,000-800,000 seats in May and June, which is disappointing and still unexplained by Boeing.
You know, I can understand why, you know, there may be various challenges manufacturing new aircraft, but aircraft that you built and made two years ago, which all you had to kind of do is put petrol in them and fucking fly them to Dublin. Really, I don't understand why it's taking you're taking two- and three-month delays on that. It is redolent of, you know, I think the very poor management performance in Seattle, both in competing for market share against Airbus and in just fucking dishonoring your commitments and delivering the planes you promised to deliver. We are not the only airlines who've been critical of Boeing delivery delays. There's a number of other airlines out there, and we know our customers who are critical of what are unexplained delivery delays.
Now, you know, they would say, "Well, you know, we've had people out with COVID." Look, we've all had people out with COVID. We're still able to deliver the summer schedule we proposed. All you've got to do is deliver aircraft that you built two years ago, and it's been disappointing. It's been very disappointing to see Boeing lose existing customer orders. You know, Jet2 have converted to Airbus. Qantas on the short haul have converted to Airbus. You know, Boeing should be winning that business. Boeing should be out there competing and, you know, there's a lot of, I think, management speak coming out of Seattle and not a lot of delivery, and we need more delivery in Seattle.
If they get their shit together, we would be willing to take more aircraft for summer of 2023 and summer 2024 because we think there is growth there to be won. We're certainly willing to restart negotiation with them on the MAX 10. At the moment, the MAX 10 still isn't certified. If it doesn't get certified by the end of calendar 2023, you know, it may have to go back for a redesign of the MCAS, the computer system, and that could. God knows how long that will delay the process. You know, Boeing need a management reboot in Seattle and, you know, either the existing management needs to up its game or they need to change the existing management, would be our view of life.
You know, it's up to Calhoun to meet those challenges. We're very happy to work with the existing management, but they need to bloody well improve on what they've been doing delivering to us over the last 12 months. That's where we are with Boeing. We're a willing customer, but, you know, we're struggling with slow deliveries and an inability to do a deal on new aircraft, despite the number of white tails they have sitting on the fucking ground in Seattle. You know, you wonder what the hell their sales team have done for the last two years, and frankly, most of them seem to be sitting at home in their fucking jim jams, working from home instead of out there selling planes to customers.
Thank you, Michael.
James, next question.
Thank you. That's from the line of, Muneeba Kayani of Bank of America. Please go ahead. Your line is open.
Yes, good morning.
Good morning.
For the bookings for this summer, can you give us some color around kind of countries where you're seeing the strongest demand and where it's weaker? Just following up on summer pricing of a single-digit price increase. If I remember correctly, I think earlier in April, you'd mentioned in the press that you were expecting something like a 5%-10% price increase for the summer. Is that kind of how we should be thinking, like higher single digits?
Okay, two good questions there. Let me tell you the summer bookings. Like, it's very hard across the piece, you know, when we're so big across all Europe to call where's strong, where's weak. Generally speaking, across the system, certainly demand to the beaches, the Canaries, the Balearics, the Greek islands, Italy is all strong into the summer. I would struggle to come up with any area where there's weakness, although, you know, clearly a lot of the bigger domestic operations, the bookings are generally later, but they come through in strong volumes but closer in. The only notable development was immediately following the Ukraine invasion. There was a fall off in bookings into Central and Eastern Europe.
There was a significant decline on bookings into Poland, Romania, Slovakia, and the Baltic States. You know, there was a kind of impression, shit, there's a war going on over there. That has righted itself, but, you know, it undoubtedly took a hit there. We see strong demand out of the Central and Eastern European countries into the summer, the beaches of Bulgaria, Greece, Turkey, and also, I think, to Spain and Italy during the summer. Really, we're a very big beast and, you know, I would struggle to come up with any particular pockets of weakness compared to strength, other than to point to those examples. Weak into Central Eastern Europe in the immediate aftermath of the Ukraine invasion and the summer to the European summer beaches are very strong.
Pricing in April, I mean, we were talking about pricing in April. I think, yeah, like, you know, we were looking to the first half of the year being up between 5%-10% percentage points. Again, Q1 got hit by the invasion of Ukraine, and that's why I keep coming back to this point. There's a strong recovery underway, but it is fragile. Easter, and Easter was largely the middle of April. Like Easter, the Ukraine invasion probably cost us anything upwards of about 800,000 bookings in Easter. It took, you know, I'd say the Q1 yields would have been small, marginally positive, and it went marginally negative because we had to respond quickly to maintain the Easter and the first half of May bookings. June, second half of May and June are building nicely.
The second quarter, July, August, September, looks strong. Again, if there's any negative news flow emerges in the next couple of weeks, they'll fall over again. What we're trying to convey today is there's a very strong recovery underway. We are very confident that we get to 115% traffic growth pre-COVID through the first two in H1 of the current year. We're not sure of where pricing will finish up. It could be better than we expect if we get a reasonable news flow. It could fall over again if there's negative news flow. It is really very difficult to call it. We know that we have the.
If you like, we have the benefit or the luxury of being very well hedged on fuel, competing with other competitors across Europe who are either unhedged or less well hedged than we are. We have a huge cost advantage over them. If there is any downturn or negative news flow, we will simply open up on pricing, maintain our traffic growth, but open up on pricing. That will then reflect itself in yields and profitability going forward, which is why we are slightly uncertain today on both yields and profitability into the second half of the year. Next question, please.
Thank you. That's from the line of Carolina Dores of Morgan Stanley. Please go ahead.
Carolina, hi.
Hi. Hi, good morning. Probably for Neil. I guess on the hedging and the exposure that you have, usually you used to do just forward on jet fuel. Is there now an exposure to the crack spread, or have you been hedging on oil, or the exposure or the hedging continue to be purely on jet fuel? And my second question on the RFP that you're doing, if assuming that you could take Airbus, would you consider it. Would you buy those aircraft, or you just lease it for until you can get the enough points to make up the fleet? Thank you.
Okay, Carolina.
Neil, I don't know if either Thomas Fowler might be on the line, but do you wanna deal with the fuel hedging, and I'll deal with the RFP?
Yeah. I'm very happy to deal with the fuel. Carolina, there's absolutely no exposure to the crack spreads or where we're hedging. As we've always done the underlying jet commodity. So perfectly correlated from that perspective. Michael, if you wanna do the RFP.
Okay. On the RFP, we've an RFP out there for up to 50 short-haul aircraft. We are willingly happy to look at Airbus and/or 737s. We have Airbus in the Lauda fleet and 737s all over Buzz, and Malta Air and Ryanair. We're happy to buy or lease, as long as, you know, whichever would come up with, whichever would offer us the better financial return. I think the likelihood in the current marketplace though is we're probably looking at leasing, you know, anything between 30-50 new aircraft for delivery for summer of 2023, 2024, 2025. I would like to see that as an acceleration of growth over that period of time, in addition to the 50 aircraft deliveries we take for the MAX aircraft we take from Boeing, assuming Boeing can actually deliver those aircraft.
It could be Boeing or it could be Airbus or 737s. The Airbus market is undoubtedly tighter. Airbus have been significantly more successful than Boeing over the last couple of years at selling the NEOs than Boeing have with the MAX aircraft. Obviously, the MAX sales was disrupted by the grounding for two years. We've been very disappointed at the rate and frequency at which Boeing has been signing up MAX orders over the last 12 months when the MAX have been ungrounded. You know, not only they've not been selling up, they've not been doing deals, they've been losing MAX customers to Airbus competitors. We're open-minded, we would be happy to take.
If it's likely, I think in the current marketplace, we're looking at probably seven to 10 year leases, reasonably young secondhand Airbus or 737s and whichever would come out. We might take a mix of both. We could grow if we take additional Airbus in Lauda or in Lauda or Malta or Lauda Europe, which is based in Malta, or 737s we take through Ryanair or Malta Air or Buzz. It would be, you know, we as always would be opportunistic. Who's to say? Like, Boeing might get their shit together and decide they want to sell us some additional white tails that they have a lot of them sitting around parked up in the U.S. You know, we're as always opportunistic.
I think there's an opportunity to add more low-cost capacity into a marketplace where there's going to be a, over the medium term, two to three years, a strong traffic recovery in Europe. Next question, please.
That's from the line of Jarrod Castle at UBS. Please go ahead.
Jarrod, hi.
Hi. Good morning, Michael. Just a question, I guess, for you. I mean, I don't know if there's much you can say on it, but it was obviously a different environment when you kind of struck a deal for your 10 million option incentive program. So I guess, you know, could we see the terms revisited or, you know, are you confident there's a fighting chance that you can deliver on the vesting requirements before 2024? And then secondly, also something you've previously said, I think at the half-year results initially you said, you know, you could possibly get to debt neutral 12-18 months and then kind of firmed it to 24 months, with the, you know, three Qs, I guess, or with the trading update.
I mean, could we see a situation where it's sooner than March 2024? 'Cause your working capital seems very strong at the moment. Thanks.
Sorry, Jarrod. Can you repeat the second half of the question? You kind of broke up at the start. What was the second question?
Well, it was just, you know, around your net debt kind of getting back to zero. I mean, could we see it sooner than March 2024? Just given that you've got this very strong working capital inflow and, you know, you're ramping up quite quickly now. Thanks.
To use that one first. I mean, you could see net debt, you know, like it with a fair wind and an optimistic outcome, you could see us returning to net zero sooner than the end of FY 24. Will we get there by FY 23? I don't think so, unless profitability runs ahead of our expectations the next 12 months, it's possible, but I think it's unlikely by FY23. I would be.
Can I jump in there, Michael?
Yeah.
I just, I mean, Jarrod, I put EUR 4.5 billion worth of CapEx guidance into the market there at the start of this call. You have to remember that EUR 4.5 billion worth of CapEx will have to be funded over the next couple of years. Be reasonably happy that over that two-year period, that will come down. I think it would be unreasonable to expect that we would have all of that covered out by the end of the current financial year.
Yeah. I don't disagree, but I mean, I think we will certainly be at zero net debt by the end of FY24. We might get there a little bit earlier, but it won't be by the end of FY23. On my contract, I would point out, by the way, although everybody continues to miss it, that I took a pay cut from EUR 1 million to a quarter of 250,000 over the last two years during COVID. We have not yet hit any of the targets for my EUR 10 million incentive. Am I confident I will get there by 2024?
No. I'm cautiously optimistic that we will hit one of the two, if not both, targets. That would be a net profit of EURO 2 billion or a share price. I think it's EURO 20 or EURO 21. I think there's a reasonable fighting chance into a post-COVID recovery. We could get to one or other or both of those by FY24, but the gap is, window is closing, and if I don't get there, well, then shareholders have had the benefit of my leadership at a fucking deeply discounted rate for the last three years.
I understand I won't starve, but nevertheless, it is the downside of these share option schemes if the company doesn't perform. I would, in our defense, say that wasn't a management failing, but none of us envisaged fucking COVID grounding the business for the last two years. I have undoubtedly been the worst paid CEO in the airline sector in Europe for the last two or three years. That was part of the downside of the deal I did. The upside is if we can hit the targets, I do well out of share options. The downside, if I don't hit them, I take a hit on the underlying pay.
I think, I would say, "Don't cry for me, Argentina." The truth is I'll keep working away here trying to hit these ambitious targets on behalf of our shareholders and our people, because if we get to those targets, our people get the pay cuts restored, too. That is much more important to me than my share options over the next two years.
Thanks, Michael. Hopefully both happen.
Yeah. Next question, please.
That's Harry Gowers at JP Morgan. Please go ahead.
Harry, hi.
Morning, Michael. Thanks for taking. I'll be quick. Just some comments, maybe if we do enter a recessionary environment, some color on what you've seen previously when there's been a weak environment. I mean, maybe could we see some trading down on the leisure side, but maybe also the corporate passenger side as well?
Well, yes. I mean, all of the last three or four recessions over the last 20 years are. You know, Ryanair as the lowest cost carrier grows faster, generally and more profitably in recessions. What would be different this time around is if there's a recession this winter, what happens to oil prices? You know, energy is the real kind of the unknown quantity. I mean, I'm personally of the view, I don't think Putin can sustain a kind of the war in Ukraine for another six, nine, 12 months. That gets resolved before the end of this calendar year. That means there's a much more kind of significant fall in energy prices, but I don't know when the timing of that will be.
We do run the risk that you could have a very deep recession into the winter of this year, allied to high energy prices as we move into the winter and there's still scarce supply. Ultimately, Russian natural gas and oil will find an outlet somewhere, even if it's only into China. It is a commodity. The greatest cure for high oil prices is high oil prices. You know, I think the shale, U.S. shale production, Iran and others may be encouraged into increased production. The Saudis might add, or the OPEC+ countries may add to production, but who knows? All I do know is that, you know, if oil prices remain at these elevated levels, you will see fuel surcharges this summer in Europe.
Competitors like Wizz Air who are completely unhedged and EasyJet are less well-hedged than we are into the winter, will be under significant pressure to up airfares. We will have a significant headroom in the difference between our airfares and competitor airfares through next winter. There will be, both at the corporate side and on the leisure side and the city break, people will trade down to the lowest cost provider, and that will undoubtedly be Ryanair. I would be optimistic that we will grow stronger and more profitably if there is a downturn or a recession this winter or into the summer of 2023.
Great. Thank you very much for your thoughts.
Thank you. I would add to that, you know, we'll be operating a fleet next summer 2023 of almost 120 aircraft. We're carrying 4% more seats and burning 16% less fuel. We will be much better positioned than any other airline in Europe to weather higher oil prices through a recession. Next question, please.
Thank you. That comes from the line of Mark Simpson at Goodbody. Please go ahead.
Yeah. Morning. Yeah, thanks for hanging on, sir, for the last calls or questions. Two for Neil, actually. Neil, FX policy, I mean, your hedging, any guidance for FY24. You're well-positioned, I think, for the current fiscal year. Just on the accrued expenses and other liabilities, the unearned revenue line at the end of March.
Okay. As you said, we're well hedged on the currency in the current year at over 1.17. Just over about 65% of the currency on the OpEx. Very well hedged on the CapEx, where we've locked out the aircraft order book at 1.24 in the euro/dollar. The hedging on the dollar into 2024 would be reflective of the quantum of hedging that we have on the jet side, Mark. We tend to do those more or less in parallel with each other. Not a huge amount into FY 2024 other than the CapEx, which is well locked away. Yes, you're right, accrued expenses and unearned income are in fact the big movement that you're seeing there.
There is a jump up obviously for increased activity in the business. But you're also seeing strong earnings coming through in that number as well. A movement of about EUR 1.7 billion year-on-year.
Thanks, Neil.
Sorry, that EUR 1.7 is mainly the unearned revenue at that year-end?
There's accruals in there. There's accrual movements in there as well, Mark. There's the unearned as a big chunk of that also.
Yeah, that's great. Okay, appreciate it. Thanks.
It's always the bulk, Mark.
Yeah. Yeah.
Thanks, Mark. Next question, please.
Currently we have no further questions in the queue.
Very good. Okay, thank you very much everybody for participating in the call. If I could leave you with a couple of parting thoughts. One, there is a strong recovery underway this summer. Ryanair is poised to recover, I think, far more strongly than any other airline in Europe. We have lower costs. We have new aircraft capacity coming to us at lower prices. These aircraft are very fuel efficient and we are very well hedged out to March 2023. The share price is under significant pressure as the sector has been for the last couple of months. This is a unique opportunity for those of you who are brave and look to any of the medium term to invest in Ryanair at something under EUR 14 per share. I think there will be a very strong rebound.
We just can't tell you whether the rebound will be this summer or next winter or the summer after that, but I think there will be a very strong rebound in the share price. If you are not a European holder, please do not buy our ordinaries. Please only buy the ADRs. The ordinaries, we will continue to disenfranchise. If there are non-EU shareholders appear on the share register owning the ordinaries, we will force you to sell those shares. Please invest in our stock, but do so only if you're a European shareholder in the ordinaries, and if you're non-European in the ADR program. Eddie, anything else? I'll ask maybe Eddie, and then Neil Sorahan any parting thoughts?
Well, just on the opportunities that are out there for growth, and the strength of the 15 bases that we opened this year, and we've got strong demand from airports for the allocation of aircraft for next summer. You know, costs are under control, and those that we can control and looking like we've got the aircraft, we've got the people and we've got the airports. Looking forward not just to the end of this summer, but into next summer 2023 as well.
Neil, any parting thoughts?
Okay. Just to remind everybody, we've a rock-solid balance sheet, BBB rated with 90% of the fleet unencumbered. That gives us huge flexibility in what we do. As Eddie said, costs are well under control and fuel is particularly well hedged for the next 12-15 months. In a very strong competitive advantage from that perspective.
Okay. Thank you very much everybody. We have, as I said, extensive roadshow underway for the remainder of this week. We have, I think about 12 roadshow teams on the road. If you want a meeting with us, please let us know either through Citi or Davy, and we'll be happy to facilitate it, whether it's in Ireland, U.K., Continental Europe or in the U.S. In the meantime, we look forward to meeting you all. Thank you for your support over what has been a very difficult last year or two, and we hope you'll see the benefit of that support over the next, 12 or 18 months with, significantly improving, operational and profit performance and share price performance. Thanks very much, everybody. Hope to see you soon. Bye-bye.
This now concludes the conference. Thank you all very much for attending. You may now disconnect your lines.