Record Results for Qtr 3
Ryanair Holdings PLC
6 February 2001
RYANAIR DELIVERS RECORD 3rd QUARTER PROFITS
TRAFFIC GROWS BY 39% PROFITS INCREASE BY 42%
(PROPOSES TO RAISE UP TO Euro123M BY PLACING ORDINARY SHARES)
Ryanair, Europe's largest low fares airline today (6 February 2001) announced
record traffic and profit figures for its third quarter ended 31 December
2000. Despite being a weaker 'winter' period, passenger volumes rose by 39%
to 1.9m, whilst adjusted profits after tax rose by 42% to Euro21.3m, compared
to the previous quarter. Basic EPS increased by 28% to 6.08 cents per share.
Summary Table of Results (Irish GAAP) - in Euro's
Quarter End: Dec 30, 2000 Dec 30, 1999 % Growth
Passengers 1.89m 1.36m 39%
Revenue Euro114.9m Euro89.6m 28%
Profit after tax Euro21.3m Euro15.9m 34%
Adjusted profit after tax * Euro21.3m Euro15.0m 42%
EPS (euro cents) 6.08 4.76 28%
Adjusted EPS (euro cents )* 6.08 4.48 36%
* Adjusted to exclude the once off profit from the sale of shares in Equant in
the 1999 figures.
Total revenues grew by 28% to Euro114.9m due to strong growth in both traffic
and ancillary sales. The continuing success of Ryanair.com enabled the
airline to offer even lower airfares and stimulate traffic on both existing
and new routes during the weaker winter months. Ryanair continues to tightly
control costs despite this rapid expansion. Operating costs during the
quarter rose by 29% to Euro21.7m a rate which is significantly less than the
rise in traffic. The particularly strong performance of Ryanair.com for
example contributed to an impressive 66% decline in marketing and distribution
costs during a quarter when traffic grew by 39%.
Announcing these results in London, Ryanair's CEO Michael O'Leary said:
'These results confirm another quarter of very strong growth by Ryanair on
both existing and new routes. The fact that Ryanair delivered 39% traffic
growth during an off- peak winter quarter whilst still increasing profit after
tax by 42% demonstrates the strength and robust nature of Ryanair's low fares
formula.
Our website, www.Ryanair.com made a very significant contribution to our
growth. Internet sales are now running in excess of 65% of all bookings,
which when added to Ryanair Direct means that we are now taking over 90% of
all bookings direct. Travel Agency sales now account for just 8% of our
bookings and are still falling.
However, the Ryanair.com website is not our only major cost reduction
intiative. Over the coming 18 months our entire fleet of 21 Boeing 737-200s
will go ex-depreciation. We've just taken delivery of 5 more 737-800s, (15 in
total) which are significantly lowering our operating costs per seat whilst
enabling us to carry 45% more passengers per flight. We have just completed a
12-year debt financing on these 5 aircraft at fixed Euro interest rates of
under 5%. Our fuel hedging policy continues to deliver Ryanair lower than
spot fuel prices and more importantly lessens our exposure to future fuel cost
increases.
Our most important initiative in cost terms during the 3rd quarter was the
revolutionary 5-year pay, productivity and share options agreement with our
pilot group. This new package will make Ryanair's pilots amongst the
best-paid and most productive short haul 737 pilots in Europe. They will
share in the success of Ryanair through enhanced participation in our share
option scheme. In return our pilots will underpin this growth over the next 5
years through moderation of basic pay increases and enhanced productivity. We
have also just now agreed a new 5-year pay and productivity deal with our
inflight people also and expect shortly to reach agreements with all other
groups within the airline on increased pay and productivity packages.
These significant initiatives (which we expect to reduce our major operating
costs on a per passenger basis) enable Ryanair to look to the future with some
degree of confidence. Unlike most of our competitors, our major operating
costs are falling and we intend to use these efficiencies to continue to lower
yields by making lower airfares even more widely available on our existing and
new routes. We will continue to be the only European airline to guarantee
that our prices are the lowest airfares on the internet through Ryanair.com.
Our growth objectives continue to be realised. Before the end of February we
plan to announce at least six new destinations, one additional European base
and increased frequency on some of our existing routes. This summer's
expansion is designed to enable Ryanair to grow to 9 million passengers over
the coming year making us not just the largest low fares carrier, but one of
the top ten international scheduled airlines (by traffic numbers) in Europe.
This quarter's results again demonstrate the outstanding job that the 1,500
people in Ryanair are doing. We have for 10 years been pioneering low fare
air travel in Europe. We are aggressively competing with British Airways,
Lufthansa, Alitalia and Air France among others in their home markets. We are
bringing down the cost of air travel in Europe, and giving ordinary people the
choice of flying where previously many couldn't afford to pay the high fares
charged by Europe's flag carriers.'
Proposed Share Placement
Ryanair also announces today that it intends to place up to 10 million new
ordinary shares in the company ('the new ordinary shares'), representing
approximately 2.8% of the existing share capital of the company. At the same
time, Michael O'Leary, the C.E.O of the company also intends to sell up to 3.0
million of his ordinary shares ('the existing ordinary shares', and together
with the new ordinary shares, the 'placing shares'). In total this represents
some 3.7% of the company's issued share capital. Michael O'Leary currently
owns 30 million ordinary shares or 8.5% of the issued share capital of the
company. Ryanair and Michael O'Leary also expect to offer the underwriters an
option to purchase up to an additional 1.0 million ordinary shares each to
cover over allotments.
The net proceeds from the placing will be used principally to finance the
acquisition of 13 new Boeing 737-800 series aircraft, five of which will be
delivered in December 2001 and January of 2002, one each in May, June, July of
2002 with five more being delivered in December 2002 and January 2003. The
funds may also be used to exploit opportunities for the purchase of
second-hand aircraft, and the company believes that there will be significant
opportunities to acquire significant quantities such aircraft over the next 12
to 24 months.
The offering will be directed at both existing and new institutional investors
in Ireland, the UK and Continental Europe, with the intention of continuing to
broaden the company's European shareholder base. The placing shares to be sold
in the placing, have not been, and will not be registered under the U.S.
Securities Act of 1933, and no offers or sales of such shares may be made in
the U.S. or to U.S. persons. The placing shares are being offered and sold
outside the United States in reliance under Regulation S under the Securities
Act.
Morgan Stanley & Co. International Ltd, and Davy Stockbrokers, will act as
joint lead managers of the proposed placing and Goldman Sachs will act as a
co-lead manager. Details of the number of new ordinary shares to be issued
and the price at which the placing shares will be sold are expected to be
determined and announced on Friday 9th February, following a series of
roadshow presentations of the company in Ireland, the UK and Continental
Europe.
This announcement has been issued by and is the sole responsibility of Ryanair
Holdings plc (the 'Company ') and has been approved solely for the purposes of
section 57 of the Financial Services Act 1986 by Morgan Stanley and Co.
International Limited ( ' Morgan Stanley'), which is regulated in the United
Kingdom by The Securities and Futures Authority Limited. Morgan Stanley is
advising the Company and Mr. O'Leary in relation to the proposed offering and
no one else and will not be responsible to anyone other than the Company for
providing the protection afforded to customers of Morgan Stanley nor for
providing advice in relation to the proposed offering.Stabilisation-FSA.
This announcement is not for publication or distribution or release in the
United States of America ( including its territories and possessions, any
State of the United States and the District of Columbia). This announcement
does not constitute or form part of an offer or solicitation of an offer to
purchase or subscribe for securities in the United States or any other
jurisdiction. The securities referred to herein have not been and will not be
registered under the United States Securities Act of 1933, as amended, and may
not be offered or sold in the United States or to or for the benefit of U.S.
persons, except pursuant to an available exemption from registration. No
public offering of securities is being made in the United States.
Ryanair Holdings has been notified that the partners of Irish Air Gen Par LP
(Genpar) are proceeding with dissolution of the partnership, which will
involve distribution of 4,553,220 ordinary shares of Ryanair (approximately
1.3% of the outstanding shares of Ryanair) to the individual partners. David
Bonderman, Chairman of Ryanair is the principal partner and prior to the
dissolution had a beneficial interest in 3,528,340 ordinary shares. Post the
dissolution he has transferred 3,278,730 shares into a trust for the benefit
of his children. Two of the other directors of Ryanair, Jeff Shaw and Rick
Schifter, post the dissolution will continue to have a beneficial interest in
192,800 and 332,410 shares, respectively.
For results and further information please contact:
Howard Millar Pauline McAlester
Ryanair Holdings Plc Murray Consultants
Tel: 353-1-8121212 Tel: 353-1-6633332
www.Ryanair.com
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 45 low fare routes across
11 countries. Ryanair has a fleet of 36 Boeing 737's, orders for up to a
further 30 new 737-800's which will be delivered over the next 4 years.
Ryanair currently employs a team of 1,500 people and will carry over 7 million
scheduled passengers in the current year.
www.RYANAIR.COM was launched in January 2000 and is already Europe's largest
travel website. This is the only internet site to guarantee the lowest fares
on the web.
Ryanair Holdings plc and Subsidiaries
Consolidated Profits and Loss Accounts in accordance
with UK and Irish GAAP (unaudited)
Nine Nine
Quarter Quarter months months
Ended Ended Ended Ended
Dec 31, Dec 31, Dec 31, Dec 31,
2000 1999 2000 1999
Euro'000 Euro'000 Euro'000 Euro'000
Operating Revenues
Scheduled revenues 100,256 80,180 338,130 253,092
Ancillary revenues 14,648 9,432 42,693 31,020
Total operating
revenues 114,904 89,612 380,823 284,112
continuing operations
Operating expenses
Staff costs 15,147 12,433 45,689 36,007
Depreciation and 15,505 11,280 42,299 32,424
amortisation
Other operating
expenses
Fuel & Oil 16,524 10,723 46,792 31,792
Maintenance, materials 4,588 4,956 15,346 12,875
and repairs
Marketing and 2,472 7,265 18,153 23,822
distribution costs
Aircraft rentals 2,192 339 7,270 1,770
Route charges 8,770 6,570 27,252 19,821
Airport and Handling 16,829 10,661 50,491 32,242
charges
Other 11,218 8,073 30,664 23,310
Total operating 93,245 72,300 283,956 214,063
expenses
Operating profit- 21,659 17,312 96,867 70,049
continuing operations
Other
income/(expenses)
Interest receivable 5,255 1,907 13,647 5,136
and similar income
Interest payable and
similar charges (3,154) (1,329) (7,535) (2,713)
Foreign exchange gains 677 1,058 323 922
Gain: on disposal of
fixed assets 53 929 53 929
Total other
income/(expenses) 2,831 2,565 6,488 4,274
Profit on ordinary
activities 24,490 19,877 103,355 74,323
before taxation
Tax on profit on (3,145) (3,939) (18,651) (15,981)
ordinary activities
Profit for the 21,345 15,938 84,704 58,342
financial period
Earnings per ordinary
share(1)
Basic(Euro cents) 6.08 4.76 24.16 17.42
Diluted (Euro cents) 6.01 4.76 23.88 17.27
Number of ordinary
shares (in 000's)(1)
Basic 350,782 334,850 350,536 334,850
Diluted 355,279 337,873 354,769 337,729
(1) The company implemented a 2:1 share split on February 28th, 2000. Share
capital and earnings per share figures have been restated to give effect to
the share split.
Ryanair Holdings plc and Subsidiaries
Consolidated Balance Sheets in accordance with
UK and Irish GAAP
December March
31, 2000 31,2000
Euro'000 Euro'000
(unaudited)
Fixed Assets
Tangible assets 523,973 315,032
Financial assets 36 36
Total Fixed Assets 524,009 315,068
Current Assets
Cash and liquid 432,190 355,248
resources
Accounts receivable 14,771 21,974
Other assets 15,270 6,478
Inventories 14,887 13,933
Total current assets 477,118 397,633
Total assets 1,001,127 712,701
Current liabilities
Accounts payable 39,074 22,861
Accrued expenses and
other 99,320 107,445
Liabilities
Current maturities of
long term debt 20,209 9,567
Short term borrowings 221 3,780
Total current 158,824 143,653
liabilities
Other liabilities
Provisions for
liabilities and charges 22,849 15,279
Long Term debt 292,550 112,412
315,399 127,691
Shareholder's funds -
equity
Called -up share capital 8,911 8,892
Share Premium Account 248,917 248,093
Profit and loss account 269,076 184,372
Shareholder's funds -
equity 526,904 441,357
Total liabilities and
shareholders' funds 1,001,127 712,701
Ryanair Holdings plc and Subsidiaries
Consolidated Cashflow Statements in Accordance
with UK and Irish GAAP (unaudited)
Period Period
ended ended
Dec 31, Dec 31,
2000 1999
Euro'000 Euro'000
Net cash inflow from operating 151,374 102,567
activities
Returns on investments and
servicing of finance 759 2,264
Taxation (12,451) (15,538)
Capital expenditure (including
aircraft deposits) (250,805) (133,353)
Net cash (outflow) before financing
and use of liquid resources (111,123) (44,060)
Financing 191,624 99,225
(Increase) in liquid resources (63,930) (48,200)
Increase in cash 16,571 6,965
Analysis of movement in liquid
resources
Liquid resources at beginning of 334,149 138,039
year
Increase in period 63,930 48,201
Liquid resources at end of period 398,079 186,240
Analysis of movement in cash
At beginning of year 17,319 16,663
Net cash outflow 16,571 6,965
Net cash at end of period 33,890 23,628
Ryanair Holdings plc and Subsidiaries
Consolidated Statement of Changes in Shareholders' Funds - Equity
in accordance with UK and Irish GAAP (unaudited)
Share Profit
Ordinary Premium and
shares account loss Total
account
Euro'000 Euro'000 Euro'000 Euro'000
Balance at April 1, 8,892 248,093 184,372 441,357
2000
Issue of ordinary
equity shares (net 19 824 0 843
of issue costs)
Profit for the 0 0 84,704 84,704
period ______ _______ ______ ______
Balance at December
31, 2000 8,911 248,917 269,076 526,904
Ryanair Holdings plc and Subsidiaries
Consolidated Profit and Loss Account in Accordance with US GAAP (unaudited)
Nine Nine
Quarter Quarter months months
Ended Ended Ended Ended
Dec 31 Dec 31 Dec 31 Dec 31
2000 1999 2000 1999
Euro'000 Euro'000 Euro'000 Euro'000
Operating Revenues
Scheduled revenues 100,256 80,180 338,130 253,092
Ancillary revenues 14,648 9,432 42,693 31,020
Total operating revenues
- continuing operations 114,904 89,612 380,823 284,112
Operating expenses
Staff costs 14,997 12,382 45,190 35,855
Depreciation and amortisation 15,378 10,797 41,686 30,963
Other operating expenses
Fuel & Oil 16,524 10,723 46,792 31,792
Maintenance, materials and 4,588 4,956 15,346 12,875
repairs
Marketing and distribution costs 2,472 7,265 18,153 23,822
Aircraft rentals 2,192 339 7,270 1,770
Route charges 8,770 6,570 27,252 19,821
Airport and Handling charges 16,829 10,661 50,491 32,242
Other 11,196 8,051 30,598 23,245
Total operating expenses 92,946 71,744 282,778 212,385
Operating profit - continuing 21,958 17,868 98,045 71,727
operations
Other income/(expenses)
Interest receivable and similar 5,255 1,907 13,647 5,136
income
Interest payable and similar
charges (3,154) (1,329) (7,535) (2,713)
Foreign exchange gains 2,803 972 3,988 387
Gains on disposal of fixed 53 929 53 929
assets
Total other income/(expenses) 4,957 2,479 10,153 3,739
Profit on ordinary activities
before taxation 26,915 20,347 108,198 75,466
Tax on profit on ordinary
activities (3,650) (3,922) (19,641) (15,855)
Net Income 23,265 16,425 88,557 59,611
Net Income per ADS(1)
Basic (Euro cents) 33.16 24.53 126.32 89.01
Diluted (Euro cents) 32.74 24.31 124.81 88.25
Weighted Average number of
shares(1)
Basic 350,782 334,850 350,536 334,850
Diluted 355,279 337,873 354,769 337,729
(1) The Company implemented a 2:1 share split on February 28th, 2000. Share
capital and earnings per hare figures have been restated to give effect to
the share split. (Each ADS represents five ordinary shares)
Ryanair Holdings plc and Subsidiaries
Summary of significant differences between UK, Irish and US generally
accepted accounting principles (unaudited)
(A) Net Income under US GAAP
Nine Nine
Quarter Quarter months months
Ended Ended Ended Ended
Dec 31, Dec 31, Dec 31, Dec 31,
2000 1999 2000 1999
Euro'000 Euro'000 Euro'000 Euro'000
Profit as reported in the
consolidated profit and loss
accounts and in accordance
with UK and Irish GAAP 21,345 15,938 84,704 58,342
Adjustments
Pension 70 44 198 133
Unrealised gains/(losses) on
forward exchange contracts 2,126 (86) 3,665 (535)
Employment grants 80 22 301 65
Basis of accounting for
August 1996 transaction 127 373 434 1,130
Basis of accounting for
aircraft acquired from
Northill Limited 0 110 179 331
Darley Investments Limited 22 22 66 65
Share option compensation
expense 0 (15) 0 (46)
Taxation effect of above (505) 17 (990) 126
adjustments
______ ______ ______ ______
Net income under US GAAP 23,265 16,425 88,557 59,611
(B) Consolidated Cashflow
Statements in accordance
with US GAAP
Half Half
Year Year
Ended Ended
Dec 31, Dec 31,
2000 1999
Euro'000 Euro'000
Cash Inflow from operating
activities 139,681 89,295
Cashflow from investing
activities (233,964) (174,451)
Cashflow from financing
activities 188,065 96,638
Increase in cash and cash
equivalents 93,782 11,482
Cash and cash equivalents at
beginning of period 121,430 97,704
Cash and cash equivalents at
end of period 215,212 109,186
Cash and cash equivalents
under US GAAP 215,212 109,186
Deposits with a maturity of
between three and six months 216,978 101,988
Cash and liquid resources
under UK and Irish GAAP 432,190 211,174
Ryanair Holdings plc and Subsidiaries
Summary of significant differences between UK, Irish and US generally
accepted accounting principles (continued) (unaudited)
(C) Shareholders' Funds Dec Dec
equity 31, 31,
2000 1999
Euro'000 Euro'000
Shareholders' equity as
reported in the
consolidated balance
sheets (UK and Irish
GAAP) 526,904 309,306
Adjustments:
Pension 1,121 693
Unrealised gains on
forward exchange 1,051 607
contracts
Employment grants (1,033) (606)
Basis of accounting for
August 1996 transactions (1,097) (2,397)
Basis of accounting for
aircraft acquired from
Northill Limited 0 (290)
Darley Investments
Limited (437) (524)
Share option compensation
expense 0 10
Investments 593 2,250
Tax effect of adjustments 243 422
Shareholders' equity as _____ ______
adjusted to accord with
US GAAP 527,345 309,471
_______ ______
Opening shareholders'
equity under US GAAP 439,340 249,912
Investments (1,395) (52)
Net income in accordance 88,557 59,611
with US GAAP
Stock issued for cash 843 0
Closing shareholder's _____ ______
equity under US GAAP 527,345 309,471
_______ _______
Ryanair Holdings plc
Management Discussion and Analysis of Results
Summary
Quarter Ended December 31, 2000
Profit after tax, adjusted for non-recurring gains on disposal of
investments in 1999, increased by 42% to Euro21.3m from Euro15.0m in the
previous quarter ended December 31,1999. Excluding the adjustment for non-
recurring gains Profit after tax has increased by 34%. Total Operating
Revenues, grew by 28% to Euro114.9m whilst passenger volumes increased by 39%
to 1.9m.
Total Operating Expenses increased by 29% to Euro93.2m, due to the increased
level of activity, and the increased costs, primarily depreciation, fuel
and airport & handling costs, associated with the growth of the airline.
These cost increases were partly offset by savings in Marketing &
Distribution costs which declined by 66% to Euro2.5m due to the significant
increase in internet bookings on Ryanair.com. Profit before Tax has
increased by 23% to Euro24.5m, excluding non-recurring gains the increase is
29%. The effective Corporation Tax rate for the quarter was 13% compared
to 20% for the previous year, and primarily reflects the reduction in the
headline rate of corporation tax in Ireland and the positive impact of the
increased level of direct bookings.
Nine months ended December 31, 2000
Profit after tax, adjusted for non-recurring gains in 1999, has increased
by 48% to Euro84.7m, compared to Euro58.3m in the previous nine months ended
December 31, 1999. Excluding the adjustment for the non-recurring gain
Profits after tax increased 45%. Total Operating Revenues grew by 34% to
Euro380.8m whilst passengers volumes have increased by 35% to 5.7m.
Total Operating Expenses increased by 33% to Euro284.0m due to the increased
level of activity, and the increased costs, primarily staff, depreciation,
fuel and airport & handing costs associated with the growth of the
airline. Profit before Tax has increased by 39% to Euro103.4m, whilst
Adjusted Profit before Tax increased by 41%. The effective Corporation Tax
rate for the period was 18% compared to 22% for the previous nine months
and primarily reflects the decline in the headline rate of Corporation Tax
in Ireland.
Balance Sheet
Cash and Liquid Resources have increased from Euro355.2m at March 31, 2000 to
Euro432.2m at December 31, 2000, reflecting the increased cash flows arising
from the profitable trading performance. During the period the company
incurred capital expenditure of Euro250.8m primarily financed by an increase
in the level of long term debt. Shareholder's Funds at December 31, 2000
have increased to Euro526.9m, compared to Euro441.4m at March 31, 2000.
Detailed Discussion and Analysis - Quarter Ended December 31, 2000
Profit after tax, adjusted for non-recurring gains on disposal of
investments in 1999, increased by 42% to Euro21.3m from Euro15.0m in the
previous quarter ended December 31, 1999 driven by strong growth in
passenger volumes and continued tight cost control. Excluding the
adjustment for non-recurring gains in 1999 Profit after tax increased by
34%. Operating Profit increased by 25% to Euro21.7m compared to the quarter
ended December 31, 1999.
Total Operating Revenues increased by 28% to Euro114.9m whilst passenger
volumes increased by 39% to 1.9m.
Scheduled Passenger Revenues increased by 25% to Euro100.3m, reflecting a 39%
increase in passenger volumes, and the successful launch of ten new routes.
The success of Ryanair.com generated substantial cost savings, that were
passed on to passengers in the form of lower average fares, which in turn
further stimulated passenger volumes.
Ancillary Revenues increased by 55% to Euro14.6m, which is higher than the
growth in passenger volumes, and primarily reflects the increase in the
level of car hire rentals, other ancillary products and internet-related
revenues.
Total Operating Expenses increased by 29% to Euro93.2m due to the increased
level of activity, and the increased costs primarily depreciation, fuel
and airport & handling costs associated with the growth of the fleet and
the airline.
Staff costs have increased by 22% to Euro15.1m. This increase reflects a 17%
increase in average employee numbers to 1,473. Pilots, who earn higher
than the average salary, accounted for 37% of the increase in employment.
Staff costs also rose due to the impact of pay increases granted which
were between 3% and 5.5%.
Depreciation and Amortisation increased by 37% to Euro15.5m due to an
increase in the number of aircraft owned from 26 to 33, two of which were
delivered in December 2000, and the amortisation of capitalised
maintenance costs.
Fuel costs rose by 54% to Euro16.5m due to a 20% increase in the number of
hours flown, an increase in the average US$ cost per gallon of fuel and
the adverse impact of the strengthening of the US dollar to the Euro.
Maintenance costs decreased by 7% to Euro4.6m due to a lower level of
unscheduled engine maintenance offset by an increase in the size of the
fleet operated, an increase in the number of flight hours, and the
increased line maintenance costs due to the continued expansion of our
Stansted base.
Marketing and Distribution Costs decreased by 66% to Euro2.5m due to a
combination of, an increase in the level of direct bookings via the
internet, a 33% reduction in the commission rate paid to travel agents,
and the termination of the distribution agreement with Galileo.
Aircraft Rental Costs increased by Euro1.9m to Euro2.2m reflecting the need to
rent additional seat capacity during the quarter.
Route Charges increased by 33% to Euro8.8m due to an increase in the number
sectors flown, and an increase in the average sector length.
Airport and Handling Charges increased by 58% to Euro16.8m due to an increase
in the number of passengers flown, the impact of increased airport and
handling charges primarily at Dublin and Stansted airports, and the
adverse impact of the strength of Sterling to the Euro, offset by, lower
charges on our new European routes.
Other Expenses increased by 39% to Euro11.2m primarily reflecting the
increased ancillary product costs arising from the increase in ancillary
revenues.
Operating Profits have increased by 25% to Euro21.7m due to the reasons
outlined above.
Interest Receivable increased by Euro3.3m to Euro5.3m reflecting the strong
growth in cash resources arising from the profitable trading performance
during the quarter. Interest Payable increased by Euro1.8m to Euro3.2m due to
the increased level of debt arising from the acquisition of seven new
aircraft.
Gains on disposal of assets in quarter ended December 31, 2000 declined by
Euro0.9m due to a non-recurring gain arising in 1999 from the profit on the
sale of shares in an airline network provider.
Taxation declined in the quarter by Euro0.8m to Euro3.2m whilst the rate of
Corporation Tax declined to 13% compared to 20% in the previous quarter.
This was due to the combined effect of the reduction in the headline rate
of Corporation Tax in Ireland and the positive impact of the increased
level of direct bookings.
Detailed Discussion and Analysis - Nine months ended December 31, 2000
Profit after tax, adjusted for non-recurring gains on disposal has
increased by increased by 48% to Euro84.7m driven by strong growth in
passenger volumes and continued tight cost control. Excluding the
adjustment for non-recurring gains Profit after tax increased by 45%.
Operating Profit increased by 38% to Euro96.9m compared to the nine months
ended December 31, 1999. Profit before tax increased by 41% to Euro103.4m,
which is higher than the percentage increase in Operating Profit due to an
increase in net interest receivable from Euro2.4m to Euro6.1m.
Total Operating Revenues increased by 34% to Euro380.8m whilst passenger
volumes increased by 35% to 5.7m.
Scheduled Passenger Revenues increased by 34% to Euro338.1m primarily due to
a combination of increased passenger numbers, and the positive impact on
average fares of the strength of Sterling to the Euro.
Ancillary Revenues increased by 38% to Euro42.7m, which is higher than the
growth in passenger volumes, and primarily reflects the increase in the
level of car hire rentals, other ancillary products and internet-related
revenues.
Total Operating Expenses increased by 33% to Euro284.0m due to the increased
level of activity, and the increased costs primarily staff, depreciation,
fuel and airport & handling costs associated with the growth of the
airline.
Staff costs have increased by 27% to Euro45.7m. This increase reflects an 18%
increase in average employee numbers to 1,468. Pilots, who earn a higher
than the average salary, accounted for 29% of the increase in employment.
Staff costs also rose due to the impact of pay increases granted which
were between 3% and 5.5%.
Depreciation and Amortisation increased by 30% to Euro42.3m due to the
delivery of an additional seven next generation 737-800 aircraft, two of
which were delivered in December 2000, and the amortisation of capitalised
maintenance costs.
Fuel costs rose by 47% to Euro46.8m due to a 28% increase in the number of
hours flown, an increase in the average US$ cost per gallon of fuel and
the adverse impact of the strengthening of the US dollar to the Euro.
Maintenance costs increased by 19% to Euro15.3m reflecting an increase in the
size of the fleet operated, an increase in the number of flight hours, and
the increased line maintenance costs due to the continued expansion of our
Stansted base. This was partly offset by a reduction in the level of
unscheduled engine maintenance.
Marketing and Distribution Costs decreased by 24% to Euro18.2m due to a
combination of, an increase in the level of direct bookings, a 33%
reduction in the commission rate paid to travel agents, the termination of
the distribution agreement with Galileo on August 1, 2000, partly offset
by higher marketing costs associated with the promotion of Ryanair.com and
the launch of ten new routes.
Aircraft Rental Costs increased by Euro5.5m to Euro7.3m reflecting the need to
rent additional seat capacity during the period.
Route Charges increased by 38% to Euro27.3m due to an increase in the number
sectors flown, and an increase in the average sector length.
Airport and Handling Charges increased by 57% to Euro50.5m due to an increase
in the number of passengers flown, the impact of increased airport and
handling charges primarily at Dublin and Stansted airports, and the
adverse impact of the strength of Sterling to the Euro, offset by, lower
charges on our new European routes.
Other Expenses increased by 32% to Euro30.7m, which is less than the growth
in ancillary revenues reflecting improved margins on some new and existing
products.
Operating Profits have increased by 38% to Euro96.9m due to the reasons
outlined above.
Interest Receivable increased by Euro8.5m to Euro13.6m reflecting the strong
growth in cash resources arising from the profitable trading performance
during the period. Interest Payable rose by Euro4.8m to Euro7.5m due to the
increased level of debt arising from the acquisition of seven new
aircraft.
Taxation increased in the period by Euro2.7m to Euro18.7m whilst the
Corporation Tax rate declined to 18% compared to 22% in the previous period
primarily due to the reduction in the headline rate of Corporation Tax in
Ireland and the increased level of direct sales.
The Company's Balance Sheet continues to strengthen due to the strong
growth in profits. Tangible fixed assets increased to Euro524.0m from
Euro315.0m principally as a result of the acquisition of seven new Boeing
737-800 aircraft. At December 31,2000 the Company had Euro432.2m in Cash and
Liquid
resources, an increase of Euro76.9m compared to March 31, 2000 despite
utilising Euro60.0m of internally generated cash on aircraft purchases and
deposits. Total Debt has increased since March 31, 2000 by Euro190.8m to
Euro312.8m to part fund the additional aircraft acquired during the period.
Shareholder's Funds at December 31, 2000 have increased to Euro526.9m
compared to Euro441.4m at March 31, 2000.
Notes to the Financial Statements
1. Accounting Policies
The accounting policies followed in the preparation of these
consolidated financial statements for the quarter and nine months
ended December 31, 2000 are consistent with those followed in the
financial year ended March 31, 2000.
2. Approval of the Financial Statements
The Audit Committee approved the consolidated financial statements
for the Quarter and Nine months ended December 31, 2000 on February
2, 2001.
3. Generally Accepted Accounting Policies
The Management Discussion and Analysis of Results for the Quarter and
Nine months ended December 31, 2000 are based on the results reported
under Irish and UK GAAP.
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