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Ryanair Holdings Flying High on Latest Results

Ryanair  (LSE: RYA  ) , the low-cost European passenger airline, announced revenues up 13% to €4.9 bilion and profits after tax increasing by 13% to €569 million in its final results to March 31, 2013. The increase in revenues was driven by passenger numbers, which lifted by 5% to 79.3 million and by an increase in the average fares of 6%. Shares were up over 6% in early trading this morning on the back of the results.

Higher oil costs had an impact, though, at 13% higher than the previous year. To combat the impact of further oil hikes, Ryanair is 90% hedged for FY2014 at $908 per tonne and 25% for the first half of FY2015 at $930 per tonne.

Basic earnings per share rose by 16% to 39.45 cents. A €68 million share buyback and a second special dividend of €492 million were completed during the year, although no final dividend was announced.

During the year, Ryanair established seven new bases across Europe and 217 new routes, bringing the total number of routes to over 1,600. 15 new aircraft were delivered to total 305 at the year end, with another 175 ordered for delivery between 2014 and 2018.

Ryanair's chief executive, Michael O'Leary, said of the results:

Delivering a 13% increase in profits and 5% traffic growth despite high oil prices during a European recession is testimony to the strength of Ryanair's ultra-low cost model. Fuel costs rose by over €290m, and now represent 45% of total costs. Excluding fuel, unit costs were up 3% due to excessive and unjustified increases in Italian ATC, Eurocontrol and Spanish airport fees. Ancillary revenues outpaced traffic growth, rising 20% to €1,064m or 22% of total revenue.

Looking to the future, Ryanair is expecting growth in traffic of around 3% to 81.5 million and a further rise in unit costs with higher oil prices and higher European airport charges. Profits are expected to be down for Q1 and under pressure for the full year but with the investment in aircraft and routes in place Ryanair is poised to continue its impressive growth progression for years to come.

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9/30/2016 12:11 PM
RYA $12.17 Down -0.10 -0.84%
Ryanair Holdings CAPS Rating: No stars