1st Quarter Results
Ryanair Holdings PLC
02 August 2005
RYANAIR ANNOUNCE RECORD Q1 RESULTS
NET PROFIT RISES 21% TO €64.4m - TRAFFIC GROWS 30% TO 8.5M
Ryanair, Europe's No.1 low fares airline, today (2 August 2005) announced record
profits of €64.4m for the Quarter ended 30 June 2005. Traffic grew by 30% to
8.5m passengers, yields increased by 3% and, as a result, total revenues rose by
35% to €404.6m. Unit costs increased by 6% (excluding fuel they fell by 9%) as
fuel costs rose by 112% to €109.9m. As a result, Ryanair's adjusted after tax
margin for the Quarter fell by 2 points to 16% as Adjusted Net Profit increased
by 21% to €64.4m.
Summary Table of Results (IFRS) - in Euro
Quarter Ended June 30, 2004 June 30,2005 % Increase
Passengers 6.6m 8.5m +30%
Revenue €299.6m €404.6m +35%
Profit after tax (Note 1) €53.1m €64.4m +21%
Basic EPS (Euro Cents)(Note 1) 6.99c 8.47c +21%
Note 1:Adjusted profit after tax and EPS during the Quarter ended 30
June 2005 excludes a receipt, net of tax, of €5.2m arising from the
settlement of an insurance claim for the scribing of 6 Boeing 737-200
aircraft.
Announcing these results Ryanair's Chief Executive, Michael O'Leary, said:
'These record quarterly results reflect the disciplined and successful roll-out
of Ryanair's low fares model across Europe. The increased profits during the
Quarter - despite the fact that Easter fell in the prior Quarter - underlines
the fundamental strength of the Ryanair low fares model, which delivers
profitable growth even during periods of intense competition and significantly
higher oil prices.
'Yields were 3% higher than last year - slightly better than anticipated -
despite a 30% increase in seat capacity. These higher yields were primarily due
to the multiple fuel surcharges imposed by the European flag carriers on their
short haul passengers, with the latest round of increases imposed in June. These
surcharges continue to widen the gap between their high fares and Ryanair's low
fares. Both Ryanair's traffic growth (+30%) and yields (+3%) have significantly
benefited from our commitment not to impose fuel surcharges on our passengers.
'Bookings were down for a number of days in the immediate aftermath of each of
the two terrorist attacks in London on the 7th and 21st of July. If there are no
further such attacks in London then we expect that our forward bookings will not
be materially impacted. However, if there are further incidents in London, both
bookings and yields could be adversely impacted.
'During the Quarter fuel costs rose by 112% to €109.9m. Fuel prices continue to
be high and the market remains volatile. We are unhedged for August but have
hedged 90% of our September volumes at $57 per barrel. Thereafter, we are 90%
hedged for the Winter period (October 2005 to March 2006) at rates equivalent to
$49 per barrel and we continue to closely monitor forward prices with a view to
hedging some or all of our requirements for the early part of Summer 2006.
'Our new routes and bases have developed well over the Summer. Both our Luton
and Liverpool bases are performing strongly and traffic at our Shannon base is
running ahead of expectations, although yields continue to be slightly lower
than expected. We recently announced our 14th European base at Pisa in Italy. We
will initially locate 2 aircraft there and have launched a further 3 new routes
from Pisa to Alghero, Dublin and Eindhoven bringing the total routes operated to
/from Pisa to 10. Our growth continues in the UK with 2 new routes from London
Stansted to Toulon in France and Krakow in Poland. We will add a fifth aircraft
to our Liverpool base from the end of September and will launch 4 new routes to
Oslo in Norway, Riga in Latvia, and Bergerac and Carcassone in France. From our
Shannon base, we have recently announced 2 new routes to Bristol in the UK and
Nantes in France.
'During the Quarter we exercised 5 Boeing 737-800 options for delivery in 2007,
1 in February, 1 in March, 1 in April and 2 in May as we continue to see many
more growth opportunities across Europe. The Boeing 737-800 offers Ryanair the
lowest unit operating cost per seat, as well as the technical reliability to
maintain our number 1 on-time performance of any major airline in Europe.
'In Ireland, passengers at Dublin Airport continue to endure third world
facilities. Despite this, the ineffective Regulator is proposing to allow
airport charges to rise by up to 40%. The Regulator has consistently failed to
address the 50% efficiency gap he identified at Dublin Airport 4 years ago, and
is bizarrely proposing to approve capital expenditure for facilities, which do
not have the support of the airline users at the airport. These expenditure
proposals include the construction of a second runway, which is not required
until Dublin's traffic reaches 35m passengers per year (currently at 17m). The
Government has also nominated the inefficient Dublin Airport Authority to build
a second terminal despite the unanimous support of airlines and passengers for
an independent competing terminal. Ryanair has initiated legal proceedings to
force the Government to honour a commitment to open up this inefficient airport
monopoly to competition.
'Our outlook for the remainder of the year is cautious as we continue to budget
for higher oil prices but anticipate that these will be partly offset by a
combination of other cost reductions and the current benign yield environment.
Our competitors imposition of further fuel surcharges (up to four in the case of
BA) on their passengers and their removal of capacity from markets is positive
for yields, and we still plan to grow traffic by approximately 27% to 35m
passengers this year. However, further terrorist attacks in London could have a
downward impact on passenger volumes and yields, although, at this early stage
we see no reason to revise our guidance. We anticipate there will be continued
intense competition and that there will be fewer low fare carriers in the
European market as higher fuel prices force loss making carriers out of the
industry. Ryanair's unique combination of the lowest costs, the lowest fares,
and industry leading customer service will, we believe, ensure that Ryanair
continues to grow profitability to the benefit of all our European passengers,
our people and our shareholders'.
Dublin 02.08.05
ENDS.
For results and further information
Howard Millar Pauline McAlester
please contact: Ryanair Holdings Plc Murray Consultants
www.Ryanair.com Tel: 353-1-8121212 Tel: 353-1-4980300
Certain of the information included in this release is forward looking and is
subject to important risks and uncertainties that could cause actual results to
differ materially. It is not reasonably possible to itemise all of the many
factors and specific events that could affect the outlook and results of an
airline operating in the European economy. Among the factors that are subject to
change and could significantly impact Ryanair's expected results are the airline
pricing environment, fuel costs, competition from new and existing carriers,
market prices for replacement aircraft, costs associated with environmental,
safety and security measures, actions of the Irish, U.K., European Union ('EU')
and other governments and their respective regulatory agencies, fluctuations in
currency exchange rates and interest rates, airport access and charges, labour
relations, the economic environment of the airline industry, the general
economic environment in Ireland, the UK and Continental Europe, the general
willingness of passengers to travel and other economics, social and political
factors.
Ryanair is Europe's largest low fares airline with 14 bases and 250 low fare
routes across 21 countries. By the end of 2005 Ryanair will operate an entire
fleet of 96 new Boeing 737-800 aircraft with firm orders for a further 134 new
aircraft, which will be delivered over the next 7 years. Ryanair currently
employs a team of 2,700 people and expect to carry approximately 35 million
scheduled passengers in the current year.
Ryanair Holdings plc and Subsidiaries
Consolidated Income Statement in accordance with IFRS (unaudited)
Quarter Quarter
ended ended
June 30, 2005 June 30,2004
€'000 €'000
Operating revenues
Scheduled revenues 346,286 259,059
Ancillary revenues 58,352 40,531
Total operating revenues -
continuing operations 404,638 299,590
Operating expenses
Staff costs 42,152 34,122
Depreciation and amortisation 26,977 23,571
Other operating expenses
Fuel & Oil 109,906 51,842
Maintenance,materials
and repairs 13,838 14,073
Marketing and distribution
costs 5,342 7,266
Aircraft rentals 10,058 8,084
Route charges 41,370 33,205
Airport and Handling charges 54,574 44,270
Other 20,537 18,416
Total operating expenses 324,754 234,849
Operating profit before exceptional items 79,884 64,741
Aircraft insurance claim 5,939 -
Operating profit after exceptional items 85,823 64,741
Other (expenses)/income
Foreign exchange gains 944 120
Gain on disposal of fixed assets - 6
Interest receivable and similar income 8,610 6,059
Interest payable and similar charges (18,435) (12,662)
Total other (expenses)/income (8,881) (6,477)
Profit before taxation 76,942 58,264
Tax on profit on ordinary activities (7,301) (5,188)
Profit for the period 69,641 53,076
Earnings per ordinary share
-Basic (Euro cent) 9.16 6.99
-Diluted (Euro cent) 9.12 6.96
Adjusted earnings per ordinary share*
-Basic (Euro cent) 8.47 6.99
-Diluted (Euro cent) 8.44 6.96
Number of ordinary shares (in 000's)
-Basic 760,519 759,280
-Diluted 763,554 762,162
* Calculated on profit for the period before exceptional items (net of tax).
Ryanair Holdings plc and Subsidiaries
Consolidated Balance Sheets in accordance with IFRS (unaudited)
June 30, 2005 March 31, 2005
€'000 €'000
Non-current assets
Intangible assets 46,841 46,841
Tangible assets 2,078,724 2,092,283
Deferred tax 23,283 1,328
Total non-current assets 2,148,848 2,140,452
Current assets
Inventories 29,667 28,069
Other assets 24,135 24,612
Accounts receivable 19,414 20,644
Derivative financial instruments 68,358 -
Restricted cash 204,040 204,040
Financial assets:cash on
deposit for greater than 3months 431,611 529,407
Cash and cash equivalents 1,150,804 872,258
Total current assets 1,928,029 1,679,030
Total assets 4,076,877 3,819,482
Current liabilities
Accounts payable 67,047 92,118
Accrued expenses and other liabilities 528,963 414,997
Current maturities of long term debt 118,664 120,997
Current tax 19,760 21,190
Total current liabilities 734,434 649,302
Other liabilities
Provisions for liabilities and charges 9,608 7,236
Derivative financial instruments 175,640 -
Deferred tax 117,965 105,509
Other creditors 72,753 29,072
Long term debt 1,267,457 1,293,860
Total other liabilities 1,643,423 1,435,677
Shareholders' funds - equity
Called - up share capital 9,730 9,675
Share premium account 574,889 565,756
Profit and loss account 1,228,225 1,158,584
Other reserves (113,824) 488
Shareholders' funds - equity 1,699,020 1,734,503
Total liabilities and shareholders' funds 4,076,877 3,819,482
Ryanair Holdings plc and Subsidiaries
Consolidated Cashflow Statement in accordance with IFRS (Unaudited)
Quarter Quarter
June 30, June 30,
2005 2004
€'000 €'000
Operating activities
Profit before taxation 76,942 58,264
Adjustments to reconcile profits before tax
to net cash provided by operating activities
Depreciation 26,977 23,571
(Increase) in inventories (1,598) (676)
Decrease in accounts receivable 1,230 930
Decrease/(increase) in other current assets 4,626 (192)
(Decrease)/increase in accounts payable (25,071) 11,405
Increase in accrued expenses 112,833 53,851
Increase/(decrease) in other creditors 19,988 (518)
Increase in maintenance provisions 2,372 1,486
Interest receivable (4,149) 175
Interest payable 994 (156)
Salary costs 139 47
Share based payment 293 -
Income tax (1,860) -
Net cash provided by operating activities 213,716 148,187
Investing activities
Capital expenditure (13,418) (60,457)
Financial assets: cash > 3months 97,796 155,318
84,378 94,861
Financing activities
Net proceeds from shares issued 9,188 154
Repayment of long debt (28,736) (19,514)
Net cash used in financing activities (19,548) (19,360)
Increase in cash and cash equivalents 278,546 223,688
Cash and cash equivalents at beginning of period 872,258 744,260
Cash and cash equivalents at end of period 1,150,804 967,948
Ryanair Holdings plc and Subsidiaries
Consolidated Statement of Changes in Shareholders' Funds - Equity
in accordance with IFRS (unaudited)
Share Profit
Ordinary premium and loss Other
shares account account reserves Total
€'000 €'000 €'000 €'000 €'000
Balance at April 1,2005 9,675 565,756 1,158,584 488 1,734,503
Issue of ordinary
equity shares 55 9,133 - - 9,188
Movement in reserves - - - (114,312) (114,312)
Profit for the period - - 69,641 - 69,641
Balance at
June 30,2005 9,730 574,889 1,228,225 (113,824) 1,699,020
Reconciliation of adjusted earnings per share
(unaudited)
Quarter Quarter
ended ended
June 30, June 30,
2005 2004
€'000 €'000
Profit for the quarter under IFRS 69,641 53,076
Adjustments
Aircraft Insurance Claim (5,939) -
Taxation adjustment for above 742 -
Adjusted profit under IFRS 64,444 53,076
Number of ordinary shares (in 000's)
-Basic 760,519 759,280
-Diluted 763,554 762,162
Adjusted earnings per ordinary share
-Basic(€cent) 8.47 6.99
-Diluted(€cent) 8.44 6.96
Ryanair Holdings plc and Subsidiaries
Consolidated Income Statement in accordance with US GAAP (unaudited)
Quarter Quarter
ended ended
June 30, 2005 June 30, 2004
€'000 €'000
Operating revenues
Scheduled revenues 346,286 259,059
Ancillary revenues 58,352 40,531
Total operating
revenues-continuing operations 404,638 299,590
Operating expenses
Staff costs 41,776 34,082
Depreciation and amortisation 27,269 23,571
Other operating expenses
Fuel & Oil 109,906 51,842
Maintenance, materials and repairs 13,838 14,073
Marketing and distribution costs 5,342 7,266
Aircraft rentals 10,058 8,084
Route charges 41,370 33,205
Airport and Handling charges 54,574 44,270
Other 20,515 18,394
Total operating expenses 324,648 234,787
Operating profit before exceptional items 79,990 64,803
Aircraft insurance claim 5,939 -
Operating profit after exceptional items 85,929 64,803
Other (expenses)/income
Foreign exchange gains 944 120
Gain on disposal of fixed assets - 6
Interest receivable and similar income 8,610 6,059
Interest payable and similar charges (16,902) (10,762)
Total other (expenses)/income (7,348) (4,577)
Income before taxation 78,581 60,226
Taxation (7,540) (5,430)
Net income 71,041 54,796
Net income per ADS
-Basic (Euro cent) 46.71 36.08
-Diluted (Euro cent) 46.52 35.95
Adjusted net income per ADS *
-Basic (Euro cent) 43.29 36.08
-Diluted (Euro cent) 43.12 35.95
Weighted Average number of shares
-Basic 760,519 759,280
-Diluted 763,554 762,162
* Calculated on net income before non-recurring items(net of tax).
(5 ordinary shares equal 1 ADR)
Ryanair Holdings plc and Subsidiaries
Summary of significant differences between IFRS and US generally
accepted accounting principles (unaudited)
(A) Net income under US GAAP
Quarter ended
June 30, June 30,
2005 2004
€'000 €'000
Net income in accordance with IFRS 69,641 53,076
Adjustments
Pension 83 40
Share based payments 293 -
Capitalised interest (net of amortisation)
regarding aircraft acquisition programme 1,241 1,900
Darley Investments Limited 22 22
Taxation - effect of above adjustments (239) (242)
Net income under US GAAP 71,041 54,796
(B) Consolidated Cashflow Statements in accordance with US GAAP
June 30, June 30,
2005 2004
€'000 €'000
Cash inflow from operating activities 213,716 148,187
Cash inflow from investing activities 84,378 94,861
Cash (outflow)from financing activities (19,548) (19,360)
Increase in cash and cash equivalents 278,546 223,688
Cash and cash equivalents at beginning
of year 872,258 744,260
Cash and cash equivalents at
end of period 1,150,804 967,948
Cash and cash equivalents under US GAAP 1,150,804 967,948
Restricted cash 204,040 200,000
Deposits with a maturity of
between three and six months 431,611 157,427
Cash and liquid resources under IFRS 1,786,455 1,325,375
Ryanair Holdings plc and Subsidiaries
Summary of significant differences between IFRS and US generally
accepted accounting principles (unaudited)
(C) Shareholders' funds - equity
June 30, June 30,
2005 2004
€'000 €'000
Shareholders' equity as reported in the
consolidated balance sheets (IFRS) 1,699,020 1,505,370
Adjustments:
Pension 11,788 8,730
Share Based payments 293 -
Capitalised interest (net of amortisation)
regarding aircraft acquisition programme 24,188 19,402
Darley Investments Limited (41) (129)
Minimum pension liability (net of tax) (6,496) (2,631)
Unrealised losses on derivative financial
instruments (net of tax) - (91,730)
Tax effect of adjustments
(excluding pension & derivative adjustments) (5,235) (2,830)
Shareholders' equity as adjusted to accord with
US GAAP 1,723,517 1,436,182
Opening shareholders'equity under US GAAP 1,629,819 1,356,281
Comprehensive Income
Unrealised gains on derivative financial
instruments (net of tax) 13,469 24,951
Net income in accordance with US GAAP 71,041 54,796
Total Comprehensive Income 84,510 79,747
Stock issued for cash 9,188 154
Closing shareholders'equity under US GAAP 1,723,517 1,436,182
Ryanair Holdings plc
Management Discussion and Analysis of Results
Introduction
For the purposes of the MD&A all figures and comments are by reference to the
adjusted income statement excluding exceptional items referred to below.
Exceptional items for quarter ended June 30, 2005 consisted of a receipt of
€5.2m (net of tax) arising from the settlement of an insurance claim for the
scribing of 6 Boeing 737-200 aircraft.
Profit after tax increased by 31% to €69.6m compared to €53.1m in the previous
quarter ended June 30, 2004. The adjusted profit for the quarter, excluding
exceptional items, increased by 21% to €64.4m.
The results for the quarter and comparative year have been prepared in
accordance with International Financial Reporting Standards ('IFRS') accounting
policies expected to be adopted in the annual financial statements for the year
ended 31 March 2006, and a detailed explanation of the financial impact of the
adoption of these policies is set out in a separate document issued with these
quarterly financial results for the period to 30 June 2005. A reconciliation
between the Net Income and Shareholders equity under IFRS and Irish/UK GAAP is
attached in Note 2 to this Management Discussion & Analysis.
Summary Quarter ended June 30, 2005
Profit after tax increased by 21% to €64.4m, compared to €53.1m in the previous
quarter ended June 30, 2004. Total operating revenues increased by 35% to
€404.6m, which was faster than the 30% growth in passenger volumes, as average
fares rose by 3% and ancillary revenues grew by 44% to €58.4m. Total revenue per
passenger as a result increased by 4% whilst load factors remained at 83%.
Total operating expenses increased by 38% to €324.8m, due to the increased level
of activity, and the increased costs, primarily fuel, route charges and airport
& handling costs associated with the growth of the airline. Fuel, our largest
cost item, increased by 112% to €109.9m due to substantial increases in the US$
cost per gallon, partially offset by the strengthening of the Euro to the US$.
Due to the significantly higher fuel costs, Operating margins declined by 2
points to 20%, which in turn resulted in Operating profit increasing by 23% to
€79.9m.
Profit before tax increased by 22%, less than the increase in operating profit
due to the higher net interest charges arising from the increased level of debt,
partially offset by foreign exchange gains which arose from the translation of
foreign currency bank balances to Euro at the quarter end exchange rates. Total
unit costs increased by 6% driven by the 112% increase in fuel costs to €109.9m.
Excluding fuel costs, total unit costs fell by 9%.
Net Margins declined by 2 points to 16% for the reasons outlined above and
Adjusted basic earnings per share increased by 21% to 8.47 cent for the Quarter.
Balance Sheet
The Company's increase in profitability continues to generate strong cashflows
from operations, which for the quarter ended June 30, 2005 amounted to €213.7m.
This cashflow funded additional aircraft deposits whilst the balance is
reflected in the €180.8m increase in Total Cash since March 31, 2005 to
€1,786.5m. The Company had no material capital expenditure during the quarter
whilst Long Term Debt, net of repayments, reduced by €28.7m. Shareholders' Funds
at June 30, 2005 have reduced by €35.5m to €1,699.0m, compared to March 31, 2005
reflecting the increase in profitability during the quarter of €64.4m offset by
a reduction of €114.6m resulting from changes in the accounting treatment for
derivative financial instruments following the adoption of IFRS.
Detailed Discussion and Analysis Quarter ended June 30, 2005
Profit after tax increased by 21% to €64.4m due to a 3% increase in average
fares and strong ancillary revenue growth, which was more than offset by fuel
costs increasing by 112% to €109.9m reflecting the higher US$ cost per gallon.
Operating margins, as a result, fell by 2 points to 20%, which in turn resulted
in Operating profit increasing by 23% to €79.9m compared to the previous
quarter.
Total operating revenues increased by 35% to €404.6m whilst passenger volumes
increased by 30% to 8.5m. Total revenue per passenger increased by 4% in the
quarter due to a combination of higher average fares and strong ancillary
revenue growth.
Scheduled passenger revenues increased by 34% to €346.3m due to a combination of
a 3% improvement in average fares, increased passenger volumes on existing
routes, and the successful launch of new routes and the new bases at Shannon,
Liverpool and Luton. Load factors remained at 83% for the quarter.
Ancillary revenues increased by 44% to €58.4m, significantly faster than the
growth in passenger volumes reflecting a strong performance in non-flight
scheduled revenues, car hire and other ancillary products. Ancillary revenues
now account for 14.4% of total revenues in the quarter compared to 13.5% in the
previous quarter.
Total operating expenses increased by 38% to €324.8m due to the increased level
of activity and increased costs, primarily fuel, aircraft rentals, route
charges, and airport and handling costs associated with the growth of the
airline. Total operating costs were also adversely impacted by an 8% increase in
the average sector length to 570 miles whilst higher US$ fuel prices were partly
offset by the strength of the Euro exchange rate against the US$.
Staff costs increased by 24% to €42.2m, primarily due to a 12% increase in
average employee numbers to 2,764, the impact of pay increases granted of 3%
during the quarter, and the increase in the proportion of pilots recruited who
earn a higher than average salary. Pilots accounted for 42% of the increase in
employment during the quarter.
Depreciation and amortisation increased by 14% to €27.0m. Depreciation charges
increased due to the increase in the size of the 'owned' fleet from 56 to 74,
offset by lower amortisation charges due to the retirement of 737-200 and the
positive impact of a new engine maintenance agreement on the cost of
amortisation of 737-800 aircraft. The strengthening of the Euro to US$ also had
a positive impact on the depreciation and amortisation charge relating to new
aircraft deliveries.
Fuel costs rose by 112% to €109.9m due to an increase in the number of sectors
flown, an 8% increase in the average sector length, and a significantly higher
average US$ cost per gallon of fuel partially offset by the positive impact of
the strengthening of the Euro to the US$ during the period.
Maintenance costs decreased by 2% to €13.8m reflecting the improved reliability
arising from the higher proportion of 737's operated, the lower level of
maintenance costs incurred due to the return of six leased 737-300's and the
positive impact of the strengthening of the Euro exchange rates against Sterling
and US$.
Marketing and distribution costs decreased by 26% to €5.3m due to the reduction
in the level of marketing activity and related expenditure compared to the
previous year.
Aircraft rental costs increased by 24% to €10.1m reflecting an additional 7
aircraft on lease during the quarter offset by the savings arising from the
return of 6 737-300's to ILFC.
Route charges increased by 25% to €41.4m due to an increase in the number of
sectors flown and an increase in the average sector length to 570 miles, offset
by a reduction in enroute charges in certain EU countries.
Airport and handling charges increased by 23% to €54.6m, which was slower than
the growth in passenger volumes and reflects the impact of increased costs at
certain existing airports offset by lower costs at new airports and bases.
Other expenses increased by 12% to €20.5m, which is less than the growth in
ancillary revenues and reflects improved margins on some existing products and
cost reductions achieved on indirect costs.
Operating margins have declined by 2 points to 20% due to the reasons outlined
above whilst operating profits have increased by 23% to €79.9m during the
quarter.
Interest receivable has increased by €2.6m to €8.6m for the quarter due to the
combined impact of higher levels of cash and cash equivalents and increases in
average deposit rates earned.
Interest payable increased by €5.8m due to the drawdown of debt to part fund the
purchase of new aircraft.
Foreign exchange gains increased during the quarter to €0.9m due to the positive
impact of changes in the Sterling exchange rate against the Euro compared to the
year end.
The Company's Balance Sheet continues to strengthen due to the growth in profits
during the quarter. The Company generated cash from operating activities of
€213.7m. Long Term Debt, net of repayments, reduced by €13.4m. Total Cash
continued to reflect the strong trading performance of the Company during the
year and at June 30, 2005 and stood at €1,786.5m compared to €1,605.7m at March
31, 2005.
Shareholders' Funds at June 30, 2005 have reduced by €35.5m to €1,699.0m,
compared to March 31, 2005 reflecting the increase in profitability during the
quarter of €64.4m offset by a reduction of €114.6m resulting from changes in the
accounting treatment for derivative financial instruments following the adoption
of IFRS.
Notes to the Financial Statements
1. Accounting Policies
This quarterly financial information has been prepared on the basis of the
recognition and measurement requirements of International Financial
Reporting Standards ('IFRS') in issue that either are adopted by the EU and
effective (or available for early adoption) at 31 March 2006 or are expected
to be adopted and effective (or available for early adoption) at 31 March
2006, the Group's first annual reporting date at which it is required to use
accounting standards adopted by the EU. Based on these recognition and
measurement requirements, management has made assumptions about the
accounting policies expected to be applied, which are as set out below, when
the first annual financial statements are prepared in accordance with
accounting standards adopted by the EU for the financial year ending 31
March 2006. The preliminary accounting policies are set out in the document
titled 'Explanation of the financial impact following adoption of IFRS'
published today.
2. Summary Reconciliation from IFRS to Irish/UK GAAP for the Quarter ended 30
June, 2005
Quarter Ended Quarter Ended
30 Jun 05 30 Jun 04
€'000 €'000
Net Income (after tax) under IFRS 69,641 53,076
EPS - IFRS 9.16c 6.99c
Diluted Earnings Per Share - IFRS 9.12c 6.96c
Retirement Benefits 199 65
Business Combinations (423) (586)
Share Based Payments 293 -
Net Income (after tax)
Irish/UK GAAP 69,710 52,555
Earnings per Share -
Irish/UK GAAP 9.16c 6.92c
Diluted Earning per Share -
Irish/ UK GAAP 9.12c 6.90c
% Variance from accounting changes 0.01% -1%
Quarter Ended Full Year Ended
30 Jun 05 30 Mar 05
€'000 €'000
Shareholders equity under IFRS 1,699,020 1,734,503
Retirement Benefits 9,499 9,300
Business Combinations (16,815) (16,392)
Derivative Financial Instruments 114,605 -
Shareholders equity under
Irish/UK GAAP 1,806,309 1,727,411
% Variance from accounting changes 6.3% 0.4%
3. Approval of the Preliminary Announcement
The Audit Committee approved the consolidated financial statements for the
Quarter ended June 30, 2005 on July 31, 2005.
4. Generally Accepted Accounting Policies
The Management Discussion and Analysis of Results for the Quarter ended June
30, 2005 and the comparative Quarter are based on the results reported under
IFRS accounting policies, as adjusted for exceptional income.
5. Ancillary Products and Services
In order to more accurately reflect the structure of certain ancillary
contracts and to provide more meaningful information to users the Group
has taken the opportunity to reclassify certain ancillary revenues and
costs (primarily car hire and travel insurance). This has resulted in a
reduction in revenues of €8.2 million with a corresponding reduction in
costs in the quarter ended 30 June 2005 (30 June 2004: €3.2 million).
This has resulted in an increase in net margin of 0.4% to 15.9% in the
quarter ended 30 June 2005 (30 June 2004 0.2% to 17.7%). Going forward
the Group intends to report ancillary revenues and costs on a basis
consistent with the treatment described herein.'
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The company news service from the London Stock Exchange
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