Final Results
Ryanair Holdings PLC
20 June 2000
RYANAIR ANNOUNCES RECORD
ANNUAL RESULTS
Ryanair Holdings Plc today (20th June 2000) announced record
financial results for the year ended March 31, 2000. Total
revenues grew by 25% to EUR370.1m, reflecting a 13% increase in
passenger volumes to 5.6m, an increase in average yields due to
a longer sector length, and the increased strength of Sterling
to the Euro. Operating expenses increased by 26% which, as
expected, was fractionally ahead of revenue growth reflecting
the increased costs (primarily staff and, airport and handling
costs) associated with the growth of the airline, and the launch
of eight new routes. As a result profits increased by 26% to a
new record of EUR72.5m for the year.
Summary Table of Results (Irish GAAP) - in Euro's
Year Mar 31, 1999 Mar 31, 2000 % Increase
Passengers 4.9m 5.6m 13%
Revenues EUR295.8m EUR370.1m 25%
Profit after tax EUR57.5m EUR72.5m 26%
Basic EPS 17.44 cents 21.62 cents 24%
Speaking in London today Michael O'Leary, Ryanair's Chief Executive
said;
'The past year has been among the most turbulent in
recent aviation history, with huge increases in fuel
prices, the ending of intra-European duty free, and
continuing intense competition throughout Europe.
Despite this market turmoil, Ryanair has continued to
deliver strong growth in fleet, routes, traffic, and
profitability. These results represent our tenth year
of rising profits, and again demonstrate the unique
strength of Ryanair's Low Fares formula.
These results cover a period during which Ryanair
purchased the first five new Boeing 737-800 series
aircraft and introduced them seamlessly into service.
This additional capacity allowed us to increase
frequencies on existing routes, whilst opening eight new
European routes from London Stansted and Glasgow
Prestwick airports. All of these new routes were
immediately profitable as customers in Germany, Italy,
France, Northern Ireland and Denmark flocked to Ryanair's
low, low, air fares.
The only dark cloud on our growth horizon remains
Ireland, where the Government continues to prioritise the
interests of its high cost airport monopoly over the
needs of the Irish consumer and potential European
visitors. Not surprisingly, total traffic to Dublin from
the UK (by far Ireland's biggest market) has stagnated,
and, in the first three months of 2000, has actually
declined for the first time since the Gulf War in 1991.
While Dublin stagnates - Ryanair continues to grow
strongly by adding capacity to existing and new routes
from Stansted (which is now Europe's fastest growing
airport), and which will shortly surpass Dublin in terms
of passenger traffic.
We remain vigilant in reducing costs and improving our
efficiencies wherever possible. Notable among these
initiatives over the last year has been the introduction
of the 189 seater Boeing 737-800 series aircraft, which
has significantly reduced our operating costs per seat.
Our policy of hedging, fuel, currency, and interest rate
exposures continued to pay substantial dividends last
year as we have been insulated from adverse market
movements. Even as we announce these results today
Ryanair has hedged almost 100% of our fuel needs over the
next twelve months, and we are fully protected from
interest rate increases in servicing aircraft related
debt.
Undoubtedly the most significant cost initiative last year
was the launch of our www.RYANAIR.COM internet site. The
startling success and instant customer acceptance of
RYANAIR.COM has enabled us to increase our proportion of
direct bookings to almost 70%, reduce travel agents
commission to 5%, and finally allow us to eliminate the
over priced Galileo CRS system which we will cease using
on 31 July next. We are reinvesting these substantial
savings in lower air fares and aggressive promotion of our
RYANAIR.COM internet site which will in turn assist our
growth by developing and enhancing customer loyalty.
There are 3 features that make the RYANAIR.COM site
different from other internet travel sites and other low
fares airlines. Firstly it is both profitable and cash
positive. Secondly, because Ryanair has historically sold
some 60% of our seats through travel agents, the switching
of a large proportion of this traffic to the internet is
generating large savings in CRS fees and agent commissions
which are not available to other low fares airlines who
have never had to bear the high costs of travel agency
distribution. Thirdly, RYANAIR.COM has truly unique
content - namely the lowest scheduled air fares in Europe -
and this unique content is winning many new subscribers,
whilst our low fares keeps them coming back.
Our customer service indices have improved again last
year. Ryanair was for the third year in a row, the most
punctual airline on Dublin-London, now Europe's busiest
international scheduled route. Our on-time record
improved from 74% to 80% of all flights, and our low rate
of customer complaints fell even further from 2.5 to 2.3
per thousand passengers, a figure that is some three
times better than the very best U.S. airlines. Ryanair
continues to grow because we deliver not just the lowest
fares in Europe, but do so on some of the newest aircraft
in use, with reliable on-time services for both our
leisure and business customers.
The new financial year has started well and we are
pleased with current trading. Already four of our five
new aircraft have been delivered, six of our ten new
routes have started operating, and advance bookings on
these and the remaining four (which start in two weeks
time) are strong, but then we would expect no less as we
enter the peak Summer period. We have every reason to be
confident that our target of 7 million passengers this
year can be achieved. We continue to see our growth
prospects as strong and these are being enhanced by the
rush towards consolidation among Europe's flag carriers
which will lead to less competition and put further
upward pressure on their already high air fares.
Equally the failure to date of the newer low fare start
up carriers to demonstrate any record of sustainable
profitability underlines the unique strength of the
Ryanair low fares formula. As the big airline groups
continue to push up air fares, Ryanair will offer
competition and low fare travel to more and more
European consumers.
Lastly, this growth, and these results could not have
been delivered without the exceptional team of
outstanding people which comprise Ryanair. Ryanair's
successful company wide share option scheme continues to
reward all of our people as our share price grows in line
with the advances being made by Europe's largest, most
successful and profitable low fares airline. Ryanair's
growth is not just good news for our passengers, but
continues to be good news for our people whilst
delivering great returns for our shareholders.'
For results and further information Howard Millar Pauline McAlester
please contact: Ryanair Holdings Plc Murray
Consultants
www.Ryanair.com Tel: 353-1-8121212 Tel: 353-1-6633332
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 30 Boeing
737's, orders for up to a further 36 new 737-800's which will
be delivered over the next 4 years. Ryanair currently employs
a team of over 1300 people and will fly 7 million passengers in
the current year.
www.RYANAIR.COM was launched in January 2000 and is already
Europe's largest travel website, recording 50,000 bookings per
week. As Ryanair's low fares network continues to successfully
expand in Europe, the growth in business and bookings at
RYANAIR.COM continues to grow exponentially.
Ryanair Holdings plc and Subsidiaries
Consolidated Profits and Loss Accounts in accordance
with UK and Irish GAAP
Year Year
Ended Ended
March March
31 31
2000 1999
EUR'000 EUR'000
Operating Revenues
Scheduled revenues 330,571 258,873
Ancillary revenues 39,566 36,886
Total operating revenues
continuing operations 370,137 295,759
Operating expenses
Staff costs 48,533 39,834
Depreciation and Amortisation 44,052 36,209
Other operating expenses
Fuel & Oil 41,676 36,555
Maintenance, materials and 16,886 11,961
repairs
Marketing and distribution 32,123 24,602
costs
Aircraft rentals 2,097 2,909
Route charges 26,301 20,806
Airport and Handling charges 43,095 29,035
Other 31,319 25,987
Total operating expenses 286,082 227,898
Operating profit-continuing 84,055 67,861
operations
Other income/(expenses)
Interest receivable and 7,498 6,610
similar income
Interest payable and similar
charges (3,781) (237)
Foreign exchange gains 1,358 389
Gains on disposal of fixed 964 1,187
assets
Total other income/(expenses) 6,039 7,949
Profit on ordinary activities
before taxation 90,094 75,810
Tax on profit on ordinary (17,576) (18,339)
activities
Profit for the financial year 72,518 57,471
Earnings per ordinary share*
Basic - (Euro cents) 21.62 17.44
Diluted (Euro cents) 21.48 17.38
Number of ordinary shares (in
000's)*
Basic 335,478 329,520
Diluted 337,681 330,639
* 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
Year Year
Ended Ended
March 31 March
2000 31 1999
EUR'000 EUR'000
Fixed Assets
Tangible assets 315,032 203,493
Financial assets 36 53
Total Fixed Assets 315,068 203,546
Current Assets
Cash and liquid 355,248 158,595
resources
Accounts receivable 21,974 18,475
Other assets 6,478 6,306
Inventories 13,933 12,917
Total current assets 397,633 196,293
Total assets 712,701 399,839
Current liabilities
Accounts payable 22,861 30,764
Accrued expenses and
other 107,445 77,972
Liabilities
Current maturities of
long term debt 9,567 1,765
Short term borrowings 3,780 3,893
Total current
liabilities 143,653 114,394
Other liabilities
Provisions for
liabilities and charges 15,279 11,277
Long Term debt 112,412 23,204
127,691 34,481
Shareholder's funds -
equity
Called -up share capital 8,892 8,503
Share Premium Account 248,093 130,607
Profit and loss account 184,372 111,854
Shareholder's funds - 441,357 250,964
equity
Total liabilities and
shareholders' funds 712,701 399,839
Ryanair Holdings plc and Subsidiaries
Consolidated Cashflow Statements in Accordance
with UK and Irish GAAP
Year Year
Ended Ended
March 31 March 31
2000 1999
EUR'000 EUR'000
Net cash inflow from operating 149,575 124,411
activities
Returns on investments and
servicing of finance 1,953 6,043
Taxation (15,545) (11,125)
Capital expenditure (including
aircraft deposits) (154,079) (107,123)
Net cash (outflows)/inflow before
financing and use of liquid (18,096) 12,206
resources
Financing 214,862 79,816
(Increase) in liquid resources (196,110) (79,382)
Increase in cash 656 12,640
Analysis of movement in liquid
resources
Liquid resources at beginning of
year 138,039 58,657
Increase in year 196,110 79,382
Liquid resources at end of year 334,149 138,039
Analysis of movement in cash
At beginning of year 16,663 4,023
Net cash inflow 656 12,640
Net cash at end of year 17,319 16,663
Ryanair Holdings plc and Subsidiaries
Consolidated Statement of Changes in Shareholders' Funds - Equity
in accordance with UK and Irish GAAP
Share Profit
Ordinary Premium and
shares account loss Total
account
EUR'000 EUR'000 EUR'000 EUR'000
Balance at April 1, 8,503 130,607 111,854 250,964
1999
Issue of ordinary
equity shares (net
of issue costs) 389 117,486 0 117,875
Profit for the year - - 72,518 72,518
______ ______
Balance at March
31,2000 8,892 248,093 184,372 441,357
Ryanair Holdings plc and Subsidiaries
Consolidated Profit and Loss Account in Accordance with US GAAP
Year Year
Ended Ended
March March
31 31
2000 1999
EUR'000 EUR'000
Operating Revenues
Scheduled revenues 330,571 258,873
Ancillary revenues 39,566 36,886
Total operating revenues
- continuing operations 370,137 295,759
Operating expenses
Staff costs 48,890 39,364
Depreciation and Amortisation 41,641 34,531
Other operating expenses
Fuel & Oil 41,676 36,555
Maintenance, materials and 16,886 11,961
repairs
Marketing and distribution costs 32,123 24,602
Aircraft rentals 2,098 2,909
Route charges 26,301 20,806
Airport and Handling charges 43,094 29,035
Other 31,233 25,901
Total operating expenses 283,915 225,664
Operating profit - continuing 86,222 70,095
operations
Other income/(expenses)
Interest receivable and similar 7,498 6,610
income
Interest payable and similar (3,781) (237)
charges
Foreign exchange (losses)/gains (2,397) 3,407
Gains on disposal of fixed 964 1,187
assets
Total other income/(expenses) 2,284 10,967
Profit on ordinary activities
before taxation 88,506 81,062
Tax on profit on ordinary (16,640) (19,291)
activities
Net income before cumulative
effect of accounting change 71,866 61,771
Cumulative effect of accounting
change (net of tax of - 23,122
EUR11,067,000) ______ ______
Net income 71,866 84,893
Net income per ADS before
notional foreign exchange
gains/(losses)and cumulative
effect of accounting change
(1)(2)
- Basic(Euro cents) 111.19 90.57
- Diluted(Euro cents) 110.47 90.26
Net income per ADS before 107.11 93.73
cumulative effect of accounting
change (2)
-Basic(Euro cents) 107.11 93.73
-Diluted(Euro cents) 106.41 93.41
Net income per ADS (2)
-Basic(Euro cents) 107.11 128.81
-Diluted(Euro cents) 106.41 128.38
Weighted Average number of
shares (2)
-Basic 335,478 329,520
-Diluted 337,681 330,639
(1) The U.S. GAAP Net income is after marking to market forward
contracts. The principle component of the notional loss is in relation
to Stg:Euro contracts which were entered into by the Company to protect
surplus sterling receipts. Under Irish/UK GAAP such notional
gains/(losses) are not taken to the profit/(loss) account.
(2) 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. (Each ADS represents five ordinary shares)
Ryanair Holdings plc and Subsidiaries
Summary of significant differences between UK, Irish and US generally
accepted accounting principles
Note 1 - Restatement of Comparative Results
Generally accepted accounting principles in Ireland and the United
Kingdom vary in certain significant respects from generally accepted
accounting principles in the United States as described in Note 29 to
our consolidated financial statements included in our 1999 Annual Report
on Form 20-F.
(A) Net Income under US GAAP Year Year
Ended Ended
March March
31 2000 31 1999
EUR'000 EUR'000
Profit as reported in the
consolidated profit and loss
accounts and in accordance
with UK and Irish GAAP 72,518 57,471
Adjustments
Pension 363 116
Unrealised (losses)/gains
forward exchange contracts (3,755) 3,018
Employment grants (664) 414
Basis of accounting for
August 1996 transaction 1,996 1,238
Basis of accounting for
aircraft acquired from 442 442
Northill Limited
Darley Investments Limited 86 86
Share option compensation (56) (61)
expense
Taxation effect of above 936 (952)
adjustments
Net income as adjusted to
accord with US GAAP before
cumulative effect of 71,866 61,771
accounting change
Cumulative effect of
accounting change (net of
tax expense of
EUR11,067,000) 0 23,122
Net income under US GAAP 71,866 84,893
Ryanair Holdings plc and Subsidiaries
Summary of significant differences between UK, Irish and US generally
accepted accounting principles
(B) Consolidated Cashflow
Statements in accordance
with US GAAP Year Year
Ended Ended
March 31 March 31
2000 1999
EUR'000 EUR'000
Cash Inflow from operating
activities 135,983 119,330
Cashflow from investing
activities (327,006) (158,664)
Cashflow from financing
activities 214,749 81,671
Increase in cash and cash
equivalents 23,726 42,337
Cash and cash equivalents at
beginning of year 97,704 55,367
Cash and cash equivalents at
end of year 121,430 97,704
Cash and cash equivalents
under US GAAP 121,430 97,704
Deposits with a maturity of
between three and six months 233,818 60,891
Cash and liquid resources
under UK and Irish GAAP 355,248 158,595
March March
31 2000 31 1999
(C) Shareholders' Funds equity EUR'000 EUR'000
Shareholders' equity as
reported in the consolidated
balance sheets (UK and Irish 441,357 250,964
GAAP)
ADJUSTMENTS:
Pension 923 560
Unrealised (losses)/gains on (2,614) 1,141
forward exchange contracts
Employment grants (1,334) (670)
Basis of accounting for
August 1996 transactions (1,531) (3,527)
Basis of accounting for
aircraft acquired from
Northill Limited (179) (621)
Darley Investments Limited (503) (589)
Share Option compensation
expense 0 56
Investments 1,988 2,302
Tax effect of adjustments 1,233 297
Shareholder's equity as
adjusted to accord with US 439,340 249,913
GAAP
Opening sharholder's equity
under US GAAP 249,913 102,697
Investments (314) 2,302
Net income in accordance
with US GAAP 71,866 61,771
Stock issued for cash 117,875 60,021
Cumulative effect of
accounting change 0 23,122
Closing shareholder's equity
US GAAP 439,340 249,913
Ryanair Holdings plc
Management Discussion and Analysis of Results
Summary Year Ended March 31, 2000
Consolidated Profit and Loss
Profit after tax has increased by 26% to EUR72.5m, compared to
EUR57.5m in the previous year ended March 31, 1999. Total
Operating Revenues, grew by 25% toEUR370.1m whilst passenger
volumes increased by 13% to 5.6m.
Total Operating Expenses increased by 26% to EUR286.1m, due to
the increased level of activity, and the increased costs,
primarily staff, and airport & handling costs associated with the
growth of the airline. Profit Before Tax has increased by 19% to
EUR90.1m. The effective Corporation Tax rate for the year was
20% compared to 24% for the previous year, and primarily reflects
the impact of the decline in the headline rate of corporation tax
in Ireland.
Balance Sheet
Cash and Liquid Resources have increased from EUR158.6m at March
31, 1999 to EUR355.2m at March 31, 2000, reflecting the increased
cash flows from the profitable trading performance, and the
receipt of the proceeds of the secondary offering amounting to
EUR117.9m in March 2000. During the year the company incurred
capital expenditure of EUR155.2m primarily financed by an
increase in the level of debt. Shareholder's Funds at March 31,
2000 have increased to EUR441.4m, compared to EUR251m at March
31, 1999.
Discussion and Analysis Year Ended March 31, 2000
Profit after tax has increased by 26% to EUR72.5m driven by
record passenger numbers, strong yields and tight cost control.
Operating margins have remained consistent at 23% resulting in
Operating Profit increasing by EUR16.2m to EUR84.1m compared to
year ended March 31,1999. Profit before tax increased by 19%,
which is lower than the percentage increase in Operating Profit
due to higher interest costs arising from the increase in
aircraft related debt.
Total Operating Revenues increased by 25% to EUR370.1m whilst
passenger volumes increased by 13% to 5.6m.
Scheduled Passenger Revenues increased by 28% to EUR330.6m due to
a combination of increased passenger numbers, an increase in
average yields due to the longer sector length, and the positive
impact on fares of the strength of Sterling to the Euro.
Ancillary Revenues increased by 7% to EUR39.6m which is lower
than the growth in passenger volumes, due to a reduction in the
average spend per passenger post the cessation of duty free on
July 1, 1999, being offset by, strong growth in revenues from
other ancillary activities.
Total Operating Expenses increased by 26% to EUR286.1m due to the
increased level of activity, and the increased costs primarily
staff, depreciation and airport costs associated with the growth
of the airline.
Staff costs have increased by 22% to EUR48.5m. This increase
reflects a 15% increase in average employee numbers to 1,262.
Pilots, who earn higher than the average salary, accounted for
24% of the increase in employment. Staff costs also rose due to
the impact of the 3% pay increases granted, which were ahead of
the level set by the national wage agreement.
Depreciation and Amortisation increased by 22% to EUR44.1m due to
an increase in the average number of aircraft owned from 21 to
26, and the amortisation of capitalised maintenance costs.
Fuel costs rose by 14% to EUR41.7m due to a 15% increase in the
number of sectors flown, and an increase in the average sector
length, offset by a reduction in average cost per gallon of fuel.
Maintenance costs increased by 41% to EUR16.9m 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 expansion of our Stansted base.
Marketing and Distribution Costs increased by 31% to EUR32.1m due
to a combination of an increase in passenger volumes, increased
distribution costs, and the marketing costs associated with the
launch of eight new routes.
Aircraft Rental Costs decreased by EUR0.8m to EUR2.1m due to the
delivery of five 737-800 next generation aircraft, and the
resultant decline in the need to rent additional seat capacity.
Route Charges increased by 26% to EUR26.3m due to an increase in
the number sectors flown, and an increase in the average sector
length.
Airport and Handling Charges increased by 48% to EUR43.1m due to
an increase in the number of passengers flown, the impact of
increased airport and handling charges on some existing routes,
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 21% to EUR31.3m which was higher than
the growth in passenger volumes and reflects the increased
ancillary product costs arising from the change of product mix,
post the cessation of duty free.
Operating Profits have increased by 24% to EUR84.1m due to the
reasons outlined above.
Interest Receivable increased by 13% to EUR7.5m reflecting the
strong growth in cash resources arising from the profitable
trading performance during the year. Interest Payable increased
by EUR3.5m due to the higher level of debt arising from the
acquisition of five new aircraft. Gains on Disposal of EUR1.0m
represents the gain arising on the sale of shares in an airline
network provider.
Taxation declined in the year by EUR0.8m primarily due to the
decline in the headline rate of Corporation Tax in Ireland.
The Company's Balance Sheet continues to strengthen due to the
combined benefit of strong growth in profits and receipt of the
net proceeds of the secondary offering of EUR117.9m during March
2000. The Company generated cash from operating activities of
EUR149.6m which partly funded the acquisition of five 737-800
aircraft and the additional aircraft deposits. Capital
expenditure net of acquired debt, increased by EUR58.3m during
the year.
Shareholder's Funds at March 31,2000 have increased to EUR441.4m
compared to EUR251.0 at March 31, 1999.
Notes to the Financial Statements
1. Accounting Policies
The accounting policies followed in the preparation of these
consolidated financial statements for the year ended March
31, 2000 are consistent with those set out in the Annual
Report for the year ended March 31, 1999.
2. Approval of the Financial Statements
The consolidated financial statements for the Year ended 31
March 2000 were approved by the Board of Directors on June
19th, 2000.
3. Generally Accepted Accounting Policies
The Management Discussion and Analysis of Results for the
Year ended March 31, 2000 are based on the results reported
under Irish and UK GAAP.
4. Year 2000 Compliance
The company has successfully completed its Year 2000
programme and the company's information systems continue to
operate normally.
5. Nationality Declaration
The company has undertaken to notify the shareholders twice
yearly of the percentage of Ordinary shareholders held by EU
Nationals. Accordingly, on March 31, 2000 not less than 53%
of the ordinary shares were held by EU Nationals.
6. Share Split
On February 28, 2000 the company implemented a sub-division
of the Company's Ordinary Shares of IR4p into Ordinary
Shares of IR2p (the 'Stock Split'). Both the share capital
and earnings per share figures for prior years have been
restated to give effect to the share split.