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Business

Back in profit, Ryanair announces first dividend

Text by News Wires

Latest update : 2010-06-01

Even as flag carriers struggle to curb their losses amid a dip in long-haul air travel, budget airline Ryanair announced Tuesday it had bounced back into profit last year and would issue the first shareholder dividend in its history.

AFP - Irish airline Ryanair said on Tuesday that it bounced back into profit in 2009/2010, as passenger numbers rose and fuel costs fell, and unveiled the first dividend since becoming a listed company in 1997.

Net profits stood at 305.3 million euros (372 million dollars) in the 12 months to the end of March, which contrasted with a net loss of 169.2 million euros in the prior year, the carrier said in a results statement.

Passenger numbers leapt 14 percent to 67 million travellers and revenues grew two percent to 2.988 billion euros, while fuel costs dived 29 percent on the back of lower crude oil prices.

Ryanair also revealed it will issue a shareholder dividend payment of 500 million euros in October.

Adjusted net profits, meanwhile, trebled to 319 million euros in the 2009/2010 financial year, the company added.

"We can be proud of delivering a 200-percent increase in profits and traffic growth during a global recession -- when many of our competitors have announced losses or cutbacks, while more have gone bankrupt," said Chief Executive Michael O'Leary in the earnings release.

Turning to the dividend news, O'Leary added that a collapsed Boeing order had allowed it to return cash to shareholders.

"In December 2009 we ended our discussions for a 200 new Boeing aircraft order," O'Leary said.

"Since we don't anticipate a new deal with Boeing for the foreseeable future, our gross capex (capital expenditure) will fall substantially over the next three years.

He added: "We expect to generate up to 1.0 billion euros in surplus cash by the end of 2012/2013.

"We now propose to return 500 million euros of this cash in a one-off dividend in October 2010, subject to shareholder approval."

The no-frills airline also forecast double-digit growth in both traffic and profits in the current 2010/2011 financial year -- provided there was no further disruption from Iceland's volcanic ash cloud.

The group also estimated that it has lost around 50 million euros as a result of the volcanic ash crisis, adding that the full cost would depend on the level of compensation.

Ryanair slammed British authorities for their response to the crisis which closed airspace for almost three weeks in April.

"The Icelandic volcanic ash 'monitoring' led to repeated, unnecessary, closures of large swathes of European airspace over 18 days from April 15," the group said.

"These closures have caused the cancellation of 9,400 Ryanair flights, and the loss of 1.5 million passengers up to May 18."

Date created : 2010-06-01

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