Half year results

Ryanair half year profits up 80 %
Fares fall 17 %
Traffic growth 15 %

http://www.ryanair.com/site/IE/news.php?yr=09&month=nov&story=fin-en-021109

with an interesting summing up by Michaël O'Leary - extracts :


"Ryanair's ability to grow both traffic and profits during the half year is a testament to the strength of Ryanair's lowest fare model, and our relentless cost discipline. However these results are heavily distorted by a 42% fall in fuel costs, which has masked a significant 17% decline in average fares. We expect average fares to decline by up to 20% during Quarters 3 and 4, which will result in both these quarters being loss making. Despite this our full year guidance remains unchanged and will be substantially profitable, at a time when many of our competitors are losing money, consolidating or going bust. Recent weeks have seen the demise of SkyEurope and Seagle Air in Slovakia, and MyAir in Italy, and we expect further casualties this Winter. Ryanair is the only major European airline to grow traffic and profits strongly. We are winning substantial market share from the big three high fare flag carrier groups led by Air France, BA and Lufthansa and we expect this trend to continue.

"Ryanair's relentless focus on costs continues to deliver savings. While fuel remains volatile, we have continued to reduce airport and handling costs, through our web check-in initiatives, and staff costs, with a pay freeze in both the current and coming year. At a time when many competitors are cutting pay and jobs, Ryanair continues to provide secure employment without pay cuts for over 7,000 of the best professionals in the European airline industry.

"I regret to report that we have made little progress in our discussions with Boeing for an order of 200 aircraft for delivery between 2013 and 2016. We won't continue these discussions indefinitely and have signalled to Boeing that if they are not completed before the year end, then Ryanair will end its relationship with Boeing and confirm a series of order deferrals and cancellations. We see no point in continuing to grow rapidly in a declining yield environment, where our main aircraft partner is unwilling to play its part in our cost reduction programme by passing on some of the enormous savings which Boeing have enjoyed both from suppliers and more efficient manufacturing in recent years.

"We would prefer to grow, but if Boeing doesn't share our vision, then I believe that Ryanair should change course before the end of this fiscal year and manage the airline over the next three years to maximise cash for distribution to shareholders. If we cannot invest our surplus cash efficiently in new aircraft, then we should distribute it to shareholders.

"It is appropriate at a time of economic difficulty to remain cautious and conservative in our guidance. Our outlook for fiscal 2009/10 remains unchanged. Traffic growth is strong, but at the expense of declining average fares. Ryanair's yields are being negatively impacted by the weakness of Sterling and tourist taxes in the UK and Ireland. We expect yields this Winter will continue to fall by up to 20%, which will cause material losses in Q.3 and Q.4 and accordingly our full year net profit guidance remains at the lower end of the €200m to €300m range - as we previously guided.

"While this Winter will be a difficult one for the European airline industry, Ryanair will continue to grow traffic, market share and profits. We have the strongest balance sheet in the European airline industry with over €2.5bn in cash and we continue to negotiate significant cost reductions with airports and handling companies who are keen to share in our growth, while other customers consolidate or collapse. Ryanair remains ideally positioned to return to substantial profit growth as Europe emerges from this economic downturn and we remain confident that our "growth during a recession" policy will continue to deliver substantial returns for our passengers, our people and our shareholders".

Looks like its the end of Ryanair's growth and wasting money on new aircraft and that they are going to give all the €2.5 billion cash to the shareholders - as a shareholder i am delighted with the news!

Also at todays press conference there were some nice quotes from MO'L about British Airways:

When asked what he would do if he were in charge of BA: "If I was Willie Walsh I'd have my CV out there looking for another job."

"The problem for Willie is that the board all want knighthoods rather than to run a low cost airline."

"BA have got waterfalls in their head office. The first thing I'd do if I were in charge of BA is turn off the waterfalls. The only time we have waterfalls in the Ryanair office is when the toilet or the sink leaks."

An Irish comment :

http://www.independent.ie/business/irish/carrier-in-strong-position-to-issue-boeing-ultimatum-1931544.html

always great info on FR here

http://www.ryanair.com/site/about/invest/docs/present/Half_Year_Results_2009.pdf