Bounce for Ryanair and Aer Lingus-owner shares shows airline recovery back on course
Ryanair chief executive Michael O'Leary: Back on the flight path for a potential shares incentive payout of up to €100m
A shares bounce for Ryanair and the Aer Lingus-owner IAG from the lifting of the Omicron clouds has been slowed by the Ukraine crisis but investors are still betting on a recovery for both airlines this year.
It comes as Ryanair-rival Wizz Air warned its fourth-quarter loss would likely top the almost €214m it posted for its third-quarter. The Budapest-based carrier said the emergence of the Omicron variant had hit sales in the latter part of the quarter, and it expected to be impacted by ongoing travel uncertainty in January, February and part of March. European airlines have been on a rollercoaster ride over the last year.
Shares in Ryanair rose on Wednesday by over 3% in Dublin trade, which means they have gained 9% since the start of the month and are now up 17% from this time last year.
At €16.65, the shares are now trading at January, 2019 levels, and value the airline at €18.86bn. That means that Ryanair chief Michael O’Leary could be back on the flight path for a potential shares incentive payout of up to €100m in the coming years. One of the conditions for his exercising 10 million share options at a strike price of €11.12 is if the airline's shares top €21 between April 2021 and March 2024, for a period of 28 days.
Shares in IAG, which also owns British Airways, Iberia, and Vueling, rose 7% in the session and have gained 14% in the past year. It is valued at over £7.9bn (€9.4bn).
Wizz Air chief executive Jozsef Varadi said it was in a stronger position to compete with the likes of Ryanair and EasyJet once the long-expected recovery comes. He said the airline had seen demand jump in Britain after the easing of restrictions there.
