Ryanair Holdings (RYA) will fly 5 million fewer passengers than planned next year owing to delayed deliveries of Boeing’s grounded 737 Max aircraft, and warned that jobs would be affected and airport bases closed as a result. Europe’s biggest low-cost carrier was expecting to bring the first five of 135 planes on order into service this year, and 58 by next summer. On Tuesday it said that on a “prudent” estimate it would have about half that number but there were no guarantees. Ryanair now expects to carry 157 million passengers in the year to March 2021, cutting its summer 2020 growth rate to 3% from 7%. The lower than expected passenger numbers suggest the airline will cut about 30,000 flights from its plans for next year. The 737 Max remains grounded worldwide after two crashes in Indonesia and Ethiopia killed a total of 346 people. Boeing has yet to convince regulators that its modifications are sufficient to ensure the plane’s safety.
The era of students using their loans to buy expensive textbooks upfront could be coming to an end, after the academic publisher Pearson (PSON) announced a shift towards a Netflix-style subscription-based model. The British company has for years profited from the demand for specialist textbooks at US universities, which students can be required to purchase despite them sometimes costing hundreds of dollars. Pearson has been badly affected by the growth in secondhand sales and falling revenues. The company has come to accept consumer behaviour has changed and, as a result, it is shifting to a model where material is rented, not owned – similar to the change that has taken place in the music and television industry. John Fallon, the chief executive of Pearson, announced on Tuesday that the company would focus on convincing students to subscribe to access online publications. “Our digital-first model lowers prices for students and, over time, increases our revenues,” he said. “By providing better value to students, they have less reason to turn to the secondary market.”
Burberry Group (BRBY) is back in fashion with investors after consumers clamoured to get their hands on bomber jackets and bumbags emblazoned with a new logo. On Tuesday its shares surged 14% making it the biggest riser in the FTSE 100 after a positive response to the latest designs from the new creative head, Riccardo Tisci. It has been interpreted as a sign that a business revamp, intended to propel the British brand into the same orbit as Gucci and Dior, is working. Burberry replaced its longstanding creative supremo, Christopher Bailey, with Tisci in 2018 and the former Givenchy designer has been overhauling the British label best known for its trenchcoats and signature check.
The maker of Irn-Bru and Rubicon drinks has warned of a 20% drop in annual profits after being hit by poor weather and the impact of last year’s sugar tax. Barr (A.G.) (BAG), which also makes Rockstar energy drinks and Funkin fruit cocktail mixers, blamed disappointing spring and early summer weather, especially in its Scottish heartland and the north of England, which contrasts with last year’s long, hot summer when sales surged. Roger White, the AG Barr chief executive, said: “The impulse on-the-go market is not growing, driven by the weather. The weather has been less good than the long-term average. There are some significant year-on-year challenges.”
