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will probably be much worse than after the financial crisis. Most householders were on variable-rate mortgages at that time [in 2008]. Most are on fixed-rate mortgages now and it takes time for interest rate rises to feed through.” However, Stewart said:


“The highest income groups will be able to cope with higher interest rates. The top 20%-30% of consumers will be in a relatively strong position.” He noted “the last year has


been very good for margins” but Deloitte’s quarterly survey of chief financial officers “shows CFOs expect high operating costs and sharply lower margins”. Stewart suggested:


“Controlling costs and balance sheets will be the top-two concerns. There will be a focus on resilience – not just a business’s own resilience but the resilience of third parties and exposure to third-party risk.” He also noted the UK “has


taken to hybrid working to an extent not seen elsewhere”, pointing to Google mobility data which shows people in parts of London travelling more than 40% less now than pre-pandemic and 27% less in the UK as a whole compared with just 12% less in Germany. Andreas Scriven, Deloitte lead


partner for hospitality and leisure, told the conference: “Consumers are starting to cut back day-to- day and discretionary spending. We see it with large-cost items and we see people trading down. “The hospitality industry has


held up fairly well in the UK, but in Germany there has been a drop-off already and it’s similar in Spain and France.”


Royal Caribbean reports surge in demand for 2023


Royal Caribbean Group reported “better than expected” third-quarter results amid a “continued robust demand environment” and said it is “nearing the point of full recovery”. The cruise group reported net


income of $33 million for the three months to September compared with a loss of $1.4 billion in the same period in 2021. Royal Caribbean president


and chief executive Jason Liberty


reported booking volumes in the quarter “accelerated” versus the previous quarter and remained “significantly higher than booking volumes in the third quarter of 2019”. The group noted: “Guests


continue to make reservations closer to sailing than in the past, resulting in about 50% more bookings in the quarter for current year sailings compared to the third quarter of 2019.” Yet it added: “The most notable


change has been a substantial acceleration in demand for 2023 sailings. Booking volumes for 2023 doubled during the third quarter compared to the second and were considerably higher than


Wonder of the Seas


bookings for 2020 sailings during the comparable period in 2019, the highest in company history.” Revenue in the quarter was


close to $3 billion, with load factors reaching 96% overall but Caribbean sailings near to 105% and Europe just under 90%.


Ryanair posts record profit of €1.37bn for half-year


Ian Taylor


Ryanair reported a record profit of €1.37 billion for the six months to September, up from a half-year profit of €1.15 billion in 2019. Passenger numbers were up 11%


on 2019 at 95 million over the six months and Ryanair’s fares rose 7% overall in the half year but were 14% up in the July-to-September quarter. Chief executive Michael O’Leary


said: “Concerns about the impact of recession and rising consumer price inflation on Ryanair’s business model have been greatly exaggerated. We expect to grow strongly in a recession as consumers won’t stop flying but will become more price-sensitive. “Our very strong post-Covid


recovery shows that price will continue to drive market share gains.” O’Leary added: “There has


been a considerable contraction of short-haul capacity, much of which


54 10 NOVEMBER 2022 However, O’Leary admitted the


recovery for the remainder of the financial year “remains fragile and could yet be impacted by new Covid variants or adverse geopolitical events such as Ukraine”. Yet he insisted: “Forward


Michael O’Leary


will not return in the medium term. “Most of our EU competitors


have cut capacity by up to 20% this winter while Ryanair will offer 10% more seats than pre-Covid. “Consumer propensity to travel


remains high. We expect these strong fundamentals to underpin robust traffic and fare growth for the next 18 months at least, and Ryanair will be the main beneficiary so long as there are no negative developments this winter.”


bookings, both traffic and fares, remain strong into the peak Christmas travel period.” Ryanair raised its forecast


passenger numbers for the full year to March 2023 to 168 million, up from 166.5 million and 13% up on its traffic in 2019. O’Leary said: “We remain hopeful


that full-year fares will remain ahead of pre-Covid [levels] by a mid-to- high single-digit percentage.” But he warned: “Yields could be impacted at very short notice as they were last year by Omicron and the Ukraine invasion. This cautious guidance will remain hugely dependent on not suffering adverse events this winter.”


travelweekly.co.uk


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