6-K
1
a4470f.htm
RYANAIR REPORTS HALF-YEAR PROFITS OF EURO 1.37BN
a4470f
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934
For the
month of November 2022
RYANAIR HOLDINGS PLC
(Translation
of registrant's name into English)
c/o Ryanair Ltd Corporate Head Office
Dublin Airport
County Dublin Ireland
(Address
of principal executive offices)
Indicate
by check mark whether the registrant files or will file
annual
reports
under cover Form 20-F or Form 40-F.
Form
20-F..X.. Form 40-F
Indicate
by check mark whether the registrant by furnishing the
information
contained
in this Form is also thereby furnishing the information to
the
Commission
pursuant to Rule 12g3-2(b) under the Securities
Exchange
Act of
1934.
Yes
No ..X..
If
"Yes" is marked, indicate below the file number assigned to the
registrant
in
connection with Rule 12g3-2(b): 82- ________
RYANAIR REPORTS HALF-YEAR PROFITS OF €1.37BN
S.2022 TRAFFIC & FARES ABOVE S.2019 IN STRONG POST COVID
RECOVERY
RISK OF COVID VARIANTS & UKRAINE OVERHANG H2 WINTER
SCHEDULES
Ryanair Holdings today (7 Nov.) reported a strong half-year after
tax profit of €1.37bn, compared to a pre- Covid (FY20) H1
profit of €1.15bn, due to record Q2 traffic, strong
operational reliability and robust summer fares which in Q2 were
14% up on pre-Covid pricing.
30 Sep. 2021
30 Sep. 2022
Change
Customers
39.1m
95.1m
+143%
Load
Factor
79%
94%
+15pts
Revenue
€2.15bn
€6.62bn
+207%
Op.
Costs
€2.20bn
€4.98bn*
+126%
Net
(Loss)/ PAT
(€48m)
€1,371m*
n/m
EPS
(€0.04)
€1.11
n/m
* Non-IFRS financial measure, excl. €107m except. unrealised
mark-to-market loss (timing unwind) on jet fuel caps.
During H1:
● Summer
traffic recovered strongly to 95.1m from 39.1m (+11% over pre-Covid
85.7m in FY20).
● H1
fares up 7% on pre-Covid levels (Q2: +14%, offset by lower Q1 fares
due to Ukraine invasion).
● 15
new bases and 770 new routes open in H1.
● 73
B737-8200 "Gamechangers"
delivered for S.22 - 51 due for S.23 (124
total).
● FY23
fuel 81% hedged at $67bbl (FY24 now 50% hedged at
$93bbl).
● Aircraft
capex hedged at €/$ 1.24 until FY26.
● Net
debt cut to €0.5bn at 30 Sep. (from €1.45bn at 31
Mar.).
Ryanair's Michael O'Leary, said:
ENVIRONMENT:
"We continue to invest heavily in fuel efficient, environmentally
friendly new aircraft technology. Passengers who switch to
Ryanair (from high-fare EU legacy airlines) can reduce their
emissions by up to 50% per flight, proving that with Ryanair
tourism growth can be delivered in a more sustainable manner.
During S.22 we operated 73 new B737 "Gamechanger" aircraft, which deliver 4% more seats per flight
yet burn 16% less fuel and cut noise emissions by up to
40%.
We continue to invest to accelerate the production of sustainable
aviation fuel (SAF). Our partnership with Trinity College's
Sustainable Aviation Research Centre is now in its second year and
its activity has ramped up significantly. Building on the
recent success of our partnership with Neste to power up to one
third of our Schiphol flights (AMS) with a 40% SAF blend, we signed
a long-term deal with OMV in Sep. to purchase up to 160,000 tonnes
of SAF at Ryanair airports across Austria, Germany and
CEE. Ryanair
hopes to power 12.5% of flights using SAF and cut our CO₂ per
pax/km by 10% to 60 grams by 2030. As part of our carbon
strategy, the Group recently concluded an agreement to retro-fit
scimitar winglets on our 409 B737-800NG fleet (an investment valued
at over $200m). This retro-fit program commences in W.22 and
will further reduce fuel burn by 1.5%. Through A4E, and the EU, we
are campaigning to accelerate reform of European ATC to eliminate
needless flight delays, which will substantially reduce fuel
consumption and CO₂ emissions.
In recognition of our progress to date and our industry leading
(CDP 'B') climate rating, Sustainalytics[1] has
ranked Ryanair the No.1 airline in Europe for ESG
performance. In June we submitted Ryanair's commitment letter
to SBTi[2] and
we will work with them over the next 2 years to verify our
ambitious targets to become net carbon zero by
2050.
SOCIAL:
Pay restoration:
At the outset of the Covid-19 pandemic, Ryanair and its union
partners negotiated agreements to protect crew jobs via temporary
pay cuts which were to be gradually restored from 2022 to 2025.
These agreements successfully delivered job security through the 2
years of the Covid pandemic, as Ryanair maintained not only the
jobs but also the licences of our crews. This investment
positioned Ryanair as the best prepared airline for the post-Covid
traffic recovery. By keeping our crews current, and
recruiting early, Ryanair avoided the crew shortages which caused
so many competitor cancellations and disruptions in Summer 2022.
Since Spring 2022 we have worked with our union partners to
negotiate accelerated pay restoration as part of long-term deals on
pay and rosters which run until 2026 or 2027. Long-term agreements
have, to date, been concluded to cover over 90% of our pilots and
cabin crew.
Under these long-term agreements, full pay restoration was brought
forward by 24 months to Apr. 2023, subject to our business
recovery. However, following the Group's strong H1 financial
and operational performance, we will now bring forward the full
restoration of pay for all crews covered by these long-term
agreements to 1 Dec. 2022 (instead of Apr. 2023). These crews
will now receive their full pay restoration in the Christmas
payroll. While considerable uncertainty hovers over the remainder
of FY23, it has always been our priority to restore pay as soon as
our business recovers. These long-term pay agreements with the vast
majority of our people have now delivered fully restored pay 28
months earlier than previously agreed, and they will also deliver
annual pay increases from 2024 until 2026 as we create thousands of
new well-paid crew jobs and grow traffic to 225m p.a. by
FY26.
We have written today to the tiny minority of unions representing
the less than 10% of pilots and cabin crew who have so far failed
to reach agreements on accelerated restoration, urging them to
return to negotiations. We look forward to concluding early
agreements with them on similar terms to the existing negotiated
agreements which will then cover all of our people.
Training, Customer Panel & CSAT:
Ryanair recently took delivery of the first of 8 new CAE full
flight simulators (value over $80m). We will expand our
state-of-the art training facilities over the next 3-years and are
close to selecting suitable locations for 2 new training centres (a
€100m investment) in CEE and the Iberian Peninsula.
Over recent months we've continued to invest in engineering and
maintenance, and announced new hangar facilities in Malta, Kaunas
(Lith.) and Shannon (Ire.). These new facilities will enable
us to create more cadets and apprenticeships for school leavers,
bringing through the next generation of highly skilled aviation
professionals.
Over 37,000 of our passengers recently applied to join our Customer
Panel which has expanded to include reps from Austria, France,
Germany, Ireland, Italy, Poland, Portugal, Spain and the UK.
The new Panel met in Dublin in Oct. and provided valuable insights
and suggestions to help us to further improve Ryanair's offers and
customer care. While CSAT scores were impacted by numerous
ATC delays/strikes this summer and lengthy airport security queues
(particularly in Q1), Ryanair's operational resilience, reliability
and friendly crew meant that we still recorded a very strong 83%
rating across H1.
OP. PERFORMANCE & GROWTH:
Our Group airlines delivered an industry leading operations
performance and robust post Covid traffic recovery in H1.
This summer we operated at 115% of our pre-Covid capacity,
completed over 3,000 daily flights and delivered record traffic
across peak S.22, despite unprecedented ATC disruptions and
regrettable airport security delays (primarily in Q1).
We had 73 Gamechangers in our fleet for peak S.22. Our growth
is being hampered by Boeing's inability to meet its delivery
schedule in Q3, despite their previous assurances that Ryanair
deliveries would be "prioritised". We expect Boeing will only
deliver 10 or 12 of the contracted 21 Gamechangers due before
Christmas. Boeing assure us that they will deliver all
scheduled 51 Gamechangers ahead of peak S.23, although there is a
risk that some of these deliveries could slip. We are
planning FY24 growth based on 51 extra aircraft for peak S.23 and
we continue to recruit and train substantial numbers of pilots,
cabin crew and engineers. During H1, Ryanair announced 100
new routes for W.22 and most of our S.23 capacity is now on sale
on www.ryanair.com. Our
Routes teams continue to lock-in long term traffic recovery growth
deals with airport partners across Europe which will reinforce
Ryanair's market share growth and cost leadership in
Europe.
Over the past 3 years, numerous airlines went bankrupt and many
legacy carriers (incl. Alitalia, TAP, SAS and LOT) significantly
cut their fleets and passenger capacity, even while 'doping' on
multi-billion-euro State Aid packages. These structural
capacity reductions have created enormous growth opportunities for
Ryanair to deploy our new, fuel efficient, B737 Gamechangers and as
a result our market shares have surged across major EU
markets. Our
reliability, lowest (ex-fuel) unit costs, very strong fuel and US$
hedges, fleet ownership and strong balance sheet ensures that the
Group is well placed to grow profitability and traffic to 225m p.a.
by FY26.
H1 FY23 BUSINESS REVIEW:
Revenue & Costs:
H1 scheduled revenues increased almost 250% to €4.42bn as
traffic recovered strongly from 39.1m to 95.1m (at a 94% load
factor). Record Q2 traffic and strong peak summer fares (+14%
over pre-Covid) offset a weak Easter in Q1, which saw traffic and
fares damaged by Russia's invasion of Ukraine in late Feb.
Ancillary revenue delivered a solid performance with spend
increasing to €23 per passenger. Total revenue jumped
by over 200% to €6.62bn.
While sectors more than doubled and traffic increased 143%,
operating costs rose just 126% to €4.98bn (incl. a 205%
increase in fuel to €2.18bn), driven by lower variable costs,
higher load factors and improved fuel burn from our Gamechanger
fleet. Cost per passenger (ex-fuel) fell below €30 in
H1 (slightly lower than the same period
pre-Covid).
Our FY23 jet fuel requirements are 81% hedged at an ave. of $67bbl
and during H1 we raised our FY24 jet fuel hedges to 50% at approx.
$93bbl. Forex is also well hedged with over 80% of FY23
€/$ opex hedged at 1.14 and almost 20% of FY24 hedged at
1.08. Our Boeing order book is fully hedged at €/$ 1.24
out to FY26. This very strong hedge position helps insulate
Ryanair from recent spikes in fuel prices and the US$ and gives our
Group airlines a huge cost advantage over our EU competitors,
especially this winter and into FY24.
Balance Sheet & Liquidity:
Ryanair's balance sheet is one of the strongest in the industry
with a BBB (stable) credit rating (S&P and Fitch). Net
debt at 30 Sep. has fallen to €0.5bn (from €1.45bn at
31 Mar.), despite €0.9bn capex. Almost all of the
Group's fleet of B737s are owned and over 90% are unencumbered
which widens our cost advantage at a time when interest rates and
leasing costs of our competitors are rising. Our focus over the
next year is the repayment of €1.6bn of maturing bonds while
returning our balance sheet to a broadly zero net debt
position. The strength of our balance sheet ensures that the
Group is well positioned to exploit the many growth opportunities
that are currently emerging as we grow to 225m passenger p.a. by
FY26.
RECESSION & PRICE INFLATION:
Concerns about the impact of recession and rising consumer price
inflation on Ryanair's business model have been greatly exaggerated
in recent months. As the lowest cost producer in Europe, we
expect to grow strongly in a recession as consumers won't stop
flying, but rather they will become more price sensitive.
Like Aldi, Lidl, Ikea and other price leaders our very strong post
Covid recovery shows that price will continue to drive market share
gains as we add low cost, more fuel efficient, aircraft to our
fleet over the next 4 years. As Europe recovers from the
2-year Covid pandemic there has been a considerable contraction of
short haul capacity, much of which will not return in the medium
term. Most of our EU competitors have cut capacity by up to
20% this Winter while Ryanair will offer 10% more seats than
pre-Covid.
As our H1 traffic and market share growth shows, millions of
passengers are switching to fly with Ryanair for our lower prices,
our industry leading reliability and our greener, fuel efficient
aircraft. Consumer propensity to travel remains high in Europe as a
result of full employment, rising wages and 2 years of
pent-up-demand and accumulated savings while people were 'locked
up' during Covid. We expect these strong fundamentals will
continue to underpin robust traffic and ave. fare growth for the
next 18-months at least, and Ryanair will be the main beneficiary
of these trends so long as there are no negative developments this
Winter such as Covid variants or Ukraine.
OUTLOOK:
The recovery for the remainder of FY23 remains fragile and could
yet be impacted by new Covid variants or adverse geopolitical
events such as Ukraine. However forward bookings (both
traffic and fares) remain strong over the Oct. school mid-terms and
into the peak Christmas travel period. We hope to avoid any
repeat of last year's Omicron lockdowns which damaged last
Christmas at such short notice. As is normal, at this time of year,
we have almost zero visibility into Q4 which is traditionally our
weakest quarter and which this year doesn't have any Easter
benefit.
While we remain dependent on Boeing meeting their delivery
commitments, especially for Christmas extras and Spring mid-term,
we are modestly raising our FY23 traffic guidance to 168m
passengers (previously 166.5m), up 13% on our pre-Covid
traffic. We remain hopeful that full-year fares will remain
ahead of FY20 (pre-Covid) by a mid-to-high single digit percentage
but we remain cautious that yields could be impacted at very short
notice in H2 as they were last year by Omicron in late Nov. which
damaged Christmas and the Ukraine invasion on 24 Feb. which so
clearly damaged Mar. and Apr. traffic. If we are fortunate to
avoid such negative events like Covid and Ukraine in H2 then,
thanks to our very strong traffic recovery, our advantageous fuel
and currency hedges and our widening cost and market share
leadership over competitors, we are hopeful that we will minimise
our winter losses which would enable us to deliver an FY23 PAT
(pre-exceptionals) in a range of €1.00bn to
€1.20bn. This cautious guidance will remain hugely
dependent on not suffering adverse events this Winter (as we did
last, which were clearly beyond our control)."
ENDS
For further information
please
contact:
Neil
Sorahan
Piaras
Kelly
Ryanair Holdings plc
Edelman
Tel: +353-1-9451212
Tel:
+353-1-5921330
Ryanair Holdings plc, Europe's largest airline group, is the parent
company of Buzz, Lauda, Malta Air, Ryanair & Ryanair UK.
Carrying 168m guests p.a. on approx. 3,000 daily flights from 88
bases, the Group connects 234 airports in 37 countries on a fleet
of 517 aircraft, with a further 132 Boeing 737s on order, which
will enable the Ryanair Group to grow traffic to 225m p.a. by FY26.
Ryanair has a team of over 19,000 highly skilled aviation
professionals delivering Europe's No.1 operational performance, and
an industry leading 37-year safety record. Ryanair is Europe's
greenest, cleanest, major airline group and customers switching to
fly Ryanair can reduce their CO₂ emissions by up to 50%
compared to major European legacy airlines.
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 the
replacement of aircraft, costs associated with environmental,
safety and security measures, the availability of appropriate
insurance cover, actions of the Irish, U.K., European Union ("EU")
and other governments and their respective regulatory agencies,
post-Brexit uncertainties, weather related disruptions, ATC strikes
and staffing related disruptions, delays in the delivery of
contracted aircraft, 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 U.K. and Continental Europe, the
general willingness of passengers to travel and other economics,
social and political factors, global pandemics such as Covid-19 and
unforeseen security events.
Ryanair Holdings plc and Subsidiaries
Condensed Consolidated Interim Balance Sheet as at September 30,
2022 (unaudited)
At Sep 30, 2022
At Mar 31, 2022
Note
€M
€M
Non-current assets
Property,
plant and equipment
8
9,278.4
9,095.1
Right-of-use
asset
8
220.7
133.7
Intangible
assets
146.4
146.4
Derivative
financial instruments
9
312.8
185.1
Deferred
tax
3.7
42.3
Other
assets
140.1
72.1
Total non-current assets
10,102.1
9,674.7
Current assets
Inventories
4.5
4.3
Other
assets
663.6
401.1
Trade
receivables
9
78.0
43.5
Derivative
financial instruments
9
1,157.5
1,400.4
Restricted
cash
9
22.7
22.7
Financial
assets: cash > 3 months
9
2,844.7
934.1
Cash
and cash equivalents
9
1,724.2
2,669.0
Total current assets
6,495.2
5,475.1
Total assets
16,597.3
15,149.8
Current liabilities
Provisions
4.8
9.2
Trade
payables
9
1,225.4
1,029.0
Accrued
expenses and other liabilities
2,716.8
2,992.8
Current
lease liability
47.5
56.9
Current
maturities of debt
9
1,829.1
1,224.5
Derivative
financial instruments
9
139.4
38.6
Current
tax
53.9
47.7
Total current liabilities
6,016.9
5,398.7
Non-current liabilities
Provisions
159.3
94.1
Trade
payables
9
51.3
49.2
Derivative
financial instruments
9
115.3
-
Deferred
tax
327.5
266.5
Non-current lease
liability
193.7
81.4
Non-current
maturities of debt
9
3,067.2
3,714.6
Total non-current liabilities
3,914.3
4,205.8
Shareholders' equity
Issued
share capital
10
6.9
6.8
Share
premium account
10
1,360.8
1,328.2
Retained
earnings
4,134.1
2,880.9
Other
undenominated capital
3.5
3.5
Other
reserves
1,160.8
1,325.9
Shareholders' equity
6,666.1
5,545.3
Total liabilities and shareholders' equity
16,597.3
15,149.8
Ryanair Holdings plc and Subsidiaries
Condensed Consolidated Interim Income Statement for the Half-Year
ended September 30, 2022 (unaudited)
Pre-
Except.
Pre-Except.
Half-Year
Ended
Sep 30,
Except.
Half-Year
Ended
Sep 30,
IFRS
Half-Year
Ended
Sep 30,
IFRS
Half-Year Ended
Sep 30,
Change
2022
2022
2022
2021
Note
%
€M
€M
€M
€M
Operating revenues
Scheduled
revenues
+248%
4,424.8
-
4,424.8
1,273.3
Ancillary
revenues
+149%
2,191.3
-
2,191.3
881.6
Total operating revenues
7
+207%
6,616.1
-
6,616.1
2,154.9
Operating expenses
Fuel and oil
-205%
2,177.1
122.8
2,299.9
713.1
Airport and handling charges
-106%
692.9
-
692.9
336.9
Staff costs
-93%
583.7
-
583.7
303.1
Route charges
-119%
503.4
-
503.4
230.0
Depreciation
-35%
453.1
-
453.1
336.2
Marketing, distribution and other
-118%
367.4
-
367.4
168.3
Maintenance, materials and repairs
-70%
200.3
-
200.3
117.8
Total operating expenses
-126%
4,977.9
122.8
5,100.7
2,205.4
Operating profit/(loss)
1,638.2
(122.8)
1,515.4
(50.5)
Other expenses
Net finance expense
+19%
(36.2)
-
(36.2)
(44.7)
Foreign exchange
(56.5)
-
(56.5)
(4.7)
Total other expenses
(92.7)
-
(92.7)
(49.4)
Profit/(loss) before tax
1,545.5
(122.8)
1,422.7
(99.9)
Tax (expense)/credit on profit/(loss)
4
(174.7)
15.4
(159.3)
52.3
Profit/(loss) for the half-year - all attributable to equity
holders of parent
1,370.8
(107.4)
1,263.4
(47.6)
Earnings per ordinary share (€)
Basic
1.1129
(0.0422)
Diluted
1.1101
(0.0422)
Weighted
avg. no. of ord. shares (in Ms)
Basic
1,135.2
1,128.4
Diluted
1,138.1
1,128.4
*'+' is favourable and '-' is adverse
period-on-period.
Ryanair Holdings plc and Subsidiaries
Condensed Consolidated Interim Income Statement for the Quarter
ended September 30, 2022 (unaudited)
Pre-Except.
Except.
IFRS
IFRS
Quarter
Quarter
Quarter
Quarter
Pre-
Ended
Ended
Ended
Ended
Except.
Change
Sep 30,
2022
Sep 30,
2022
Sep 30,
2022
Sep 30,
2021
Note
%
€M
€M
€M
€M
Operating revenues
Scheduled
revenues
+163%
2,848.4
-
2,848.4
1,081.4
Ancillary
revenues
+66%
1,166.2
-
1,166.2
703.0
Total operating revenues
7
+125%
4,014.6
-
4,014.6
1,784.4
Operating expenses
Fuel and oil
-106%
1,144.4
142.8
1,287.2
556.5
Airport and handling charges
-42%
355.5
-
355.5
249.8
Staff costs
-61%
309.2
-
309.2
192.1
Route charges
-43%
254.4
-
254.4
177.7
Depreciation
-12%
226.7
-
226.7
201.9
Marketing, distribution and other
-101%
193.7
-
193.7
96.4
Maintenance, materials and repairs
-100%
112.1
-
112.1
56.0
Total operating expenses
-70%
2,596.0
142.8
2,738.8
1,530.4
Operating profit
1,418.6
(142.8)
1,275.8
254.0
Other expenses
Net finance expense
+31%
(16.1)
-
(16.1)
(23.3)
Foreign exchange
(40.0)
-
(40.0)
(6.1)
Total other expenses
(56.1)
-
(56.1)
(29.4)
Profit before
tax
1,362.5
(142.8)
1,219.7
224.6
Tax (expense)/credit on profit
(161.7)
17.9
(143.8)
0.4
Profit for the quarter - attributable to equity holders of
parent
1,200.8
(124.9)
1,075.9
225.0
Earnings
per ordinary share (€)
Basic
0.9474
0.1994
Diluted
0.9456
0.1975
Weighted avg. no.
ord. shares (in Ms)
Basic
1,135.7
1,128.6
Diluted
1,137.8
1,139.5
*'+' is favourable and '-' is adverse
period-on-period.
Ryanair Holdings plc and Subsidiaries
Condensed
Consolidated Interim Statement of Comprehensive Income for the
Half-Year ended
September 30, 2022
(unaudited)
Half-Year
Half-Year
Ended
Ended
Sep 30,
2022
Sep 30,
2021
€M
€M
Profit/(loss) for the half-year
1,263.4
(47.6)
Other comprehensive (loss)/income:
Items that are or may be reclassified subsequently to profit or
loss:
Movements in hedging reserve, net of tax:
Net
movements in cash-flow hedge reserve
(170.2)
324.3
Other comprehensive (loss)/income for the half-year, net of income
tax
(170.2)
324.3
Total comprehensive income for the half-year - all attributable to
equity holders of parent
1,093.2
276.7
Ryanair
Holdings plc and Subsidiaries
Condensed Consolidated Interim Statement of Comprehensive Income
for the Quarter ended
September 30, 2022
(unaudited)
Quarter
Quarter
Ended
Ended
Sep 30,
2022
Sep 30,
2021
€M
€M
Profit for the quarter
1,075.9
225.0
Other comprehensive (loss)/income:
Items that are or may be reclassified subsequently to profit or
loss:
Movements in hedging reserve, net of tax:
Net
movement in cash-flow hedge reserve
(639.5)
234.7
Other comprehensive (loss)/income for the quarter, net of income
tax
(639.5)
234.7
Total comprehensive income for the quarter - all attributable to
equity holders of parent
436.4
459.7
Ryanair Holdings plc and Subsidiaries
Condensed Consolidated Interim Statement of Cash Flows for the
Half-Year ended September 30, 2022 (unaudited)
Half-Year
Half-Year
Ended
Ended
Sep 30,
2022
Sep 30,
2021
Note
€M
€M
Operating activities
Profit/(loss) after tax
1,263.4
(47.6)
Adjustments to reconcile profit/(loss) after tax to net cash from
operating activities
Depreciation
453.1
336.2
(Increase) in inventories
(0.2)
-
Tax expense/(credit) on profit/(loss)
159.3
(52.3)
Share based payments
8.4
5.2
(Increase) in trade receivables
(34.5)
(21.1)
(Increase) in other assets
(254.4)
(118.5)
Increase in trade payables
262.3
248.1
(Decrease)/increase in accrued expenses
(259.8)
693.5
Increase in provisions
60.8
9.6
Increase in finance income
0.9
-
(Increase) in finance expense
(11.9)
(22.1)
Foreign exchange and fair value*
110.0
-
Income tax (paid)/received
(0.7)
8.5
Net cash inflow from operating activities
1,756.7
1,039.5
Investing activities
Capital expenditure - purchase of property, plant and
equipment
(899.6)
(311.4)
Disposal proceeds
4.9
28.2
Supplier reimbursements
8
127.5
113.9
Decrease in restricted cash
-
11.4
(Increase)/decrease in financial assets: cash > 3
months
(1,910.6)
365.5
Net cash (used in)/from investing activities
(2,677.8)
207.6
Financing activities
Net proceeds from shares issued
10
19.1
4.4
Proceeds from long term borrowings
-
1,192.0
Repayments of long term borrowings
(80.7)
(943.3)
Lease liabilities paid
(26.2)
(28.6)
Net cash (used in)/from financing activities
(87.8)
224.5
(Decrease)/increase in cash and cash equivalents
(1,008.9)
1,471.6
Net foreign exchange differences
64.1
(4.1)
Cash and cash equivalents at beginning of the
period
2,669.0
2,650.7
Cash and cash equivalents at end of the period
9
1,724.2
4,118.2
Included in the cash flows from operating activities for the year
are the following amounts:
Interest
income received
3.1
-
Interest
income paid
(46.3)
(61.9)
*Includes an exceptional loss of €122.8M pre-tax,
attributable to the fair value measurement of jet fuel call
options.
Ryanair Holdings plc and Subsidiaries
Condensed Consolidated Interim Statement of Changes in
Shareholders' Equity for the Half-Year ended
September 30, 2022 (unaudited)
Ordinary Shares
Issued
Share Capital
Share
Premium Account
Retained Earnings
Other
Undenom. Capital
Other Reserves Hedging
Other Reserves
Total
M
€M
€M
€M
€M
€M
€M
€M
Balance at March 31, 2021
1,128.1
6.7
1,161.6
3,232.3
3.5
211.3
31.2
4,646.6
Loss for the half-year
-
-
-
(47.6)
-
-
-
(47.6)
Other comprehensive income
Net movements in cash flow reserve
-
-
-
-
-
324.3
-
324.3
Total other comprehensive income
-
-
-
(47.6)
-
324.3
-
276.7
Total comprehensive income
-
-
-
(47.6)
-
324.3
-
276.7
Transactions with owners of the Company recognised directly in
equity
Issue of ordinary equity shares
0.7
-
4.4
-
-
-
-
4.4
Share-based payments
-
-
-
-
-
-
5.2
5.2
Transfer of exercised and expired share based awards
-
-
-
0.9
-
(0.9)
-
Balance at September 30, 2021
1,128.8
6.7
1,166.0
3,185.6
3.5
535.6
35.5
4,932.9
Loss for the half-year
-
-
-
(193.2)
-
-
-
(193.2)
Other comprehensive income
Net movements in cash flow reserve
-
-
-
-
-
759.8
-
759.8
Total other comprehensive income
-
-
-
-
-
759.8
-
759.8
Total comprehensive income
-
-
-
(193.2)
-
759.8
-
566.6
Transactions with owners of the Company recognised directly in
equity
Issue of ordinary equity shares
5.8
0.1
107.8
(65.5)
-
-
-
42.4
Additional share premium on the allotment of shares
54.4
(54.4)
-
-
-
-
Share-based payments
-
-
-
-
-
-
3.4
3.4
Transfer of exercised and expired share based awards
-
-
-
8.4
-
-
(8.4)
-
Balance at March 31, 2022
1,134.6
6.8
1,328.2
2,880.9
3.5
1,295.4
30.5
5,545.3
Profit for the half-year
-
-
-
1,263.4
-
-
-
1,263.4
Other comprehensive income
Net movements in cash flow reserve
-
-
-
-
-
(170.2)
-
(170.2)
Total other comprehensive loss
-
-
-
-
-
(170.2)
-
(170.2)
Total comprehensive income
-
-
-
1,263.4
-
(170.2)
-
1,093.2
Transactions with owners of the Company recognised directly in
equity
Issue of ordinary equity shares
2.6
0.1
32.6
(13.5)
-
-
-
19.2
Share-based payments
-
-
-
-
-
-
8.4
8.4
Transfer of exercised and expired share based awards
-
-
-
3.3
-
-
(3.3)
-
Balance at September 30, 2022
1,137.2
6.9
1,360.8
4,134.1
3.5
1,125.2
35.6
6,666.1
Ryanair Holdings plc and Subsidiaries
MD&A Half-Year Ended September 30, 2022
Introduction
The
Ryanair Group's fleet was effectively grounded due to European
Governments' Covid-19 travel restrictions/ lockdowns for much of
the prior year comparative (notably the months of April to
June). Sectors (+105%) and traffic (+143%) are therefore
significantly higher in the half-year ended September 30, 2022. The
following discussion should be read in that context.
For
the purposes of the Management Discussion and Analysis ("MD&A")
(with the exception of the balance sheet commentary) all figures
and comments are by reference to the half-year ended September 30,
2022 results excluding the exceptional item referred to
below.
The
Group, as part of its risk management strategy, has utilised jet
fuel call options to set a maximum price for approximately 16% of
FY23 expected fuel requirements. These instruments are measured at
fair value through the income statement. Following the Russian
invasion of Ukraine in February 2022, the price of jet fuel
significantly increased and remains volatile. An exceptional
unrealised mark-to-market loss of €107M (post-tax) was
recorded on the Group's jet fuel call options at September 30,
2022. This is effectively an unwind of the cumulative €132M
(post-tax) unrealised mark-to-market gain recorded at periods ended
March 31, 2022 (€114M) and June 30, 2022
(€18M).
Income Statement
Scheduled revenues:
Scheduled revenues increased
by 248%
to €4.43BN due to a
143% increase in traffic, from 39.1M to 95.1M and 43% higher average fares (a 7% increase
on the same period pre Covid-19).
Ancillary revenues:
Ancillary revenues increased
by 149% to €2.19BN as
traffic grew (up 143%) and guests increasingly choose discretionary
services such as priority boarding, reserved seating and in-flight
sales.
Total revenues:
As a result of the above, total revenues
rose 207% to
€6.62BN.
Operating Expenses:
Fuel and oil:
Fuel and oil increased by 205% to
€2.18BN due to a
105% increase in sectors and significantly higher jet fuel prices
offset by fuel burn savings on the new B737-8200
aircraft.
Airport and handling charges:
Airport and handling charges rose
by 106%
to €693M, well below the
143% increase in traffic.
Staff
costs:
Staff costs increased by 93% to
€584M due to the
larger fleet and ramp up of activities, the roll-off of Covid-19
payroll support schemes and the commencement of pay restoration
during the period.
Route
charges:
Route charges increased
by 119% to
€503M, ahead of the
increase in sectors, due to higher Eurocontrol and ATC rates
(despite a degradation in the quality of the services provided by
ATC agencies during the half-year, particularly during peak Summer
2022).
Depreciation:
Depreciation increased by 35% to
€453M, primarily due to
higher amortisation resulting from increased aircraft utilisation
(as sectors rose by 143%) and the delivery of 57 new Boeing
737-8200 "Gamechanger" aircraft.
Marketing, distribution and other:
Marketing, distribution and other rose
by 118%
to €367M due to
higher activity (including increased in-flight sales and credit
card transactions).
Maintenance, materials and repairs:
Maintenance, materials and repairs increased
by 70% to
€200M due to higher
aircraft utilisation and the extension of 24 A320 aircraft leases
to 2028 during the period.
Other
expense:
Net finance expenses
decreased 19% to
€36.2M due to lower
net debt (at mainly fixed interest rates), offset by higher cash
balances and rising deposit interest rates. Foreign exchange
translation was negatively impacted by the movement of the
€/US$ exchange rate on balance sheet
revaluations.
Balance sheet:
Gross cash increased by €966M
to €4.59BN at
September 30, 2022.
Gross debt increased by €60M
to €5.14BN,
primarily due to the extension of lease terms on 24 A320 aircraft
at lower rentals, offset by debt repayments during the
period.
Net debt was €546M at September 30, 2022. This is a
€0.91BN reduction from €1.45BN at March 31,
2022.
Shareholders'
equity:
Shareholders' equity increased by €1.11BN
to €6.67BN in
the period primarily due to a €1.27BN net profit and an IFRS
hedge accounting unrealised loss for derivatives of
€170M.
MD&A Quarter Ended September 30, 2022
Introduction
Traffic
during the prior period comparative (quarter ended September 30,
2021) improved following the rollout of EU Digital Covid
Certificates in July, 2021 however the Group still experienced a
significant reduction in traffic as a result of European
Government's Covid-19 travel restrictions/lockdowns. Sectors (+38%)
and traffic (+60%) are therefore significantly higher in the
quarter ended September 30, 2022. The following discussion should
be read in that context.
For
the purposes of the Management Discussion and Analysis ("MD&A")
(with the exception of the balance sheet commentary) all figures
and comments are by reference to the quarter ended September 30,
2022 results excluding the exceptional item referred to
below.
The
Group, as part of its risk management strategy, has utilised jet
fuel call options to set a maximum price for approximately 16% of
FY23 expected fuel requirements. These instruments are measured at
fair value through the income statement. Following the Russian
invasion of Ukraine in February 2022, the price of jet fuel
significantly increased and remains volatile. An exceptional
unrealised mark-to-market loss of €125M (post-tax) was
recorded on the Group's jet fuel call options at September 30,
2022. This is effectively an unwind of the cumulative
€132M (post-tax) unrealised mark-to-market gain recorded at
periods ended March 31, 2022 (€114M) and June 30, 2022
(€18M).
Income Statement
Scheduled revenues:
Scheduled revenues increased
by 163%
to €2.85BN due to a
60% increase in traffic, from 31.0M to 49.5M and 65% higher average fares (a 14% increase
on the same quarter pre Covid-19).
Ancillary revenues:
Ancillary revenues increased
by 66% to €1.17BN as
traffic grew (up 60%) and guests increasingly choose discretionary
services such as priority boarding, reserved seating and in-flight
sales.
Total revenues:
As a result of the above, total revenues
rose 125% to
€4.01BN.
Operating Expenses:
Fuel and oil:
Fuel and oil increased by 106% to
€1.14BN due to a 38%
increase in sectors flown and significantly higher jet fuel prices
offset by fuel burn savings on the new B737-8200
aircraft.
Airport and handling charges:
Airport and handling charges rose
by 42%
to €356M, well below the
60% increase in traffic.
Staff
costs:
Staff costs increased by 61% to
€309M due to the
larger fleet, the ramp up of activities, the roll-off of Covid-19
payroll support schemes and the commencement of pay restoration
during the period.
Route
charges:
Route charges increased
by 43% to
€254M, ahead of the
increase in sectors, due to an increase in Eurocontrol and ATC
rates (despite a degradation in the quality of the services
provided by ATC agencies during the quarter).
Depreciation:
Depreciation increased by 12% to
€227M, primarily due to
higher amortisation resulting from increased aircraft utilisation
(as sectors rose 38%) and the delivery of 57 new Boeing
737-8200 "Gamechanger" aircraft.
Marketing, distribution and other:
Marketing, distribution and other rose
by 101%
to €194M due to
higher activity (including increased in-flight sales and credit
card transactions).
Maintenance, materials and repairs:
Maintenance, materials and repairs increased
by 100% to
€112M due to higher
aircraft utilisation and the extension of 24 A320 aircraft leases
to 2028 during the quarter.
Other
expense:
Net finance expenses
decreased 31% to
€16M due to lower
net debt (at mainly fixed interest rates), offset by higher cash
balances and rising deposit interest rates. Foreign exchange
translation was negatively impacted by the movement of the
€/US$ exchange rate on balance sheet
revaluations.
Ryanair Holdings plc and Subsidiaries
Interim Management Report
Introduction
This
financial report for the half-year ended September 30, 2022 meets
the reporting requirements pursuant to the Transparency (Directive
2004/109/EC) Regulations 2007 and Transparency Rules of the Central
Bank of Ireland.
This
interim management report includes the following:
● Principal
risks and uncertainties relating to the remaining six months of the
year;
● Related
party transactions; and
● Post
balance sheet events.
Results
of operations for the six-month period ended September 30, 2022
compared to the six-month period ended September 30, 2021,
including important events that occurred during the half-year, are
set forth above in the MD&A.
Principal risks and uncertainties for the remainder of the
year
The
Group's recovery remains fragile and prone to shocks from any
adverse Covid-19 developments. The full extent of such developments
on the Group's longer-term operational and financial performance,
many of which may be outside of the Group's control, are highly
uncertain and cannot be predicted.
Russia's
invasion of Ukraine in February 2022, and the subsequent spike in
oil prices, has created another unexpected development which will
overhang our industry until it is resolved.
Among
other factors that are subject to change and could significantly
impact Ryanair's expected results for the remainder of the year are
the airline pricing environment, capacity growth in Europe, fuel
costs, competition from new and existing carriers, market prices
for the replacement of aircraft, costs associated with
environmental, safety and security measures, the availability of
appropriate insurance coverage, actions of the Irish, U.K.,
European Union ("EU") and other governments and their respective
regulatory agencies, delays in the delivery of contracted aircraft,
supply chain disruptions/delays, weather related disruptions, ATC
strikes and staffing related disruptions, uncertainties surrounding
Brexit, 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 U.K., and Continental Europe, including
the risk of a recession or significant economic slowdown, the
general willingness of passengers to travel, other economic, social
and political factors and unforeseen security events.
Board of Directors
Details
of the members of the Group's Board of Directors are set forth on
page 17 of the Group's 2022 annual report. Julie O'Neill retired
from the Board in September 2022.
Related party
transactions -
Please see note 11.
Post balance
sheet events -
Please see note 12.
Going concern
The
Directors, having made inquiries, believe that the Group has
adequate resources to continue in operational existence for at
least the next 12 months and that it is appropriate to adopt the
going concern basis in preparing these interim financial
statements. The continued preparation of the Group's consolidated
interim financial statements on the going concern basis is
supported by the financial projections prepared by the
Group.
In
arriving at this decision to adopt the going concern basis of
accounting, the Board has considered, among other
things:
●
The
Group's net profit (pre-exceptional items) of €1.37BN in the
half-year ended September 30, 2022;
●
The
Group's liquidity, with almost €4.60BN cash at September 30,
2022, a €0.91BN reduction in net debt during the period
(despite €0.90BN in Capex) and the Group's continued focus on
cash management;
●
The
Group's solid BBB credit ratings combined with a stable outlook
(from both S&P and Fitch Ratings);
●
The
Group's strong balance sheet position with over 90% of its B737
fleet unencumbered;
●
The
Group's access to the debt capital markets, unsecured/secured bank
debt and sale and lease back transactions;
●
Ongoing
cost reductions across the Group;
●
The
Group's strong fuel hedging position (FY23 fuel requirements are
over 80% hedged and approximately 50% of FY24 jet fuel requirements
are hedged); and
●
The
Group's ability, as evidenced throughout the Covid-19 crisis, to
preserve cash and reduce operational and capital expenditure in a
downturn.
Ryanair Holdings plc and Subsidiaries
Notes forming Part of the Condensed Consolidated
Interim Financial Statements
1.
Basis of preparation and significant accounting
policies
Ryanair
Holdings plc (the "Company") is a company domiciled in Ireland. The
unaudited condensed consolidated interim financial statements of
the Company for the half-year ended September 30, 2022 comprise the
Company and its subsidiaries (together referred to as the
"Group").
These unaudited condensed
consolidated interim financial statements ("the interim financial
statements"), which should be read in conjunction with our 2022
Annual Report for the year ended March 31, 2022, have been prepared
in accordance with IAS 34 Interim
Financial Reporting as adopted by the EU ("IAS
34"). They do not include all of the information required for
full annual financial statements and should be read in conjunction
with the most recent published consolidated financial statements of
the Group. The consolidated financial statements of the Group as at
and for the year ended March 31, 2022, are available
at http://investor.ryanair.com/.
In
adopting the going concern basis in preparing the interim financial
statements, the Directors have considered Ryanair's available
sources of finance including access to the capital markets, sale,
and leaseback transactions, secured and unsecured debt structures,
the Group's cash on-hand and cash generation and preservation
projections, together with factors likely to affect its future
performance, as well as the Group's principal risks and
uncertainties.
The
September 30, 2022 figures and the September 30, 2021 comparative
figures do not constitute statutory financial statements of the
Group within the meaning of the Companies Act, 2014. The
consolidated financial statements of the Group for the year ended
March 31, 2022, together with the independent auditor's report
thereon, were filed with the Irish Registrar of Companies following
the Company's Annual General Meeting and are also available on the
Company's Website. The auditor's report on those financial
statements was unqualified.
The
Audit Committee, upon delegation of authority by the Board of
Directors, approved the unaudited condensed consolidated interim
financial statements for the half-year ended September 30, 2022 on
November 4, 2022.
Except
as stated otherwise below, this year's financial information has
been prepared in accordance with the accounting policies set out in
the Group's most recent published consolidated financial
statements, which were prepared in accordance with IFRS as adopted
by the EU and also in compliance with IFRS as issued by the
International Accounting Standards Board (IASB).
New IFRS standards and amendments adopted during the
year
The following new and amended
IFRS standards, amendments and IFRIC interpretations, have been
issued by the IASB, and have also been endorsed by the EU. These
standards are effective for the first time for the Group's
financial year beginning on April 1, 2022 and
therefore have been applied by the Group in these condensed
consolidated interim financial statements:
●
Amendments
to IFRS 3 Business Combinations; IAS 16 Property, Plant and
Equipment; IAS 37 Provisions, Contingent Liabilities and Contingent
Assets; and Annual Improvements 2018-2020 (effective on or after
January 1, 2022).
The
adoption of these new or amended standards did not have a material
impact on the Group's financial position or results in the
half-year ended September 30, 2022.
New IFRS standards and amendments issued but not yet
effective
The
following new or amended standards and interpretations will be
adopted for the purposes of the preparation of future financial
statements, where applicable. While under review, we do not
anticipate that the adoption of the other new or revised standards
and interpretations will have any or a material impact on our
financial position or performance:
●
Amendments
to IAS 12 Income
Taxes:
Deferred Tax related to Assets and Liabilities arising from a
Single Transaction (effective on or after January 1,
2023).
●
Amendments
to IAS 8 Accounting
Policies, Changes in Accounting Estimates and
Errors:
Definition of Accounting Estimates (effective on or after January
1, 2023).
●
Amendments
to IAS 1 Presentation
of Financial Statements and IFRS Practice Statement
2: Disclosure of Accounting policies (effective on or after January
1, 2023).
●
Amendments
to IAS 1 Presentation
of Financial Statements: Classification of Liabilities
as Current or Non-current and Classification
of Liabilities as Current or Non-current - Deferral of Effective
Date.*
●
IFRS
17 Insurance
Contracts (effective on or after
January 1, 2023).
●
Amendments
to IFRS 17 Insurance contracts: Initial Application of IFRS 17 and
IFRS 9 - Comparative Information (effective on or after January 1,
2023).
●
Amendments
to IFRS 16 Leases: Lease Liability in a Sale and Leaseback
(effective on or after January 1, 2024).*
*
These standards or amendments to standards are not as of yet EU
endorsed.
2.
Judgements and estimates
In
preparing these condensed interim financial statements, management
has made judgements and estimates that affect the application of
accounting policies and the reported amounts of assets and
liabilities, income and expense. Actual results may differ
from these estimates.
In
preparing these condensed consolidated interim financial
statements, the significant judgements and key sources of
estimation uncertainty were the same as those that applied in the
most recent published consolidated financial
statements.
Derivative financial instruments
The
Group uses various derivative financial instruments to manage its
exposure to market risks, including the risks relating to
fluctuations in commodity prices and currency exchange rates.
Ryanair uses forward contracts for the purchase of its jet fuel
(jet kerosene) and carbon credit (Emission Trading Scheme)
requirements to reduce its exposure to commodity price risk. It
also uses foreign currency forward contracts to reduce its exposure
to risks related to foreign currencies, principally the U.S. dollar
exposure associated with the purchase of new Boeing 737-8200
aircraft and the U.S. dollar exposure associated with the purchase
of jet fuel.
The
Group's derivative financial instruments are measured at fair value
and recognised as either assets or liabilities in its consolidated
balance sheet. All derivatives, with the exception of jet fuel call
options, are designated as cash flow hedges with the resulting
gains or losses taken to other reserves. Jet fuel call options are
measured at fair value with the resulting unrealised gains or
losses taken to the income statement. At September 30, 2022, a net
asset of €465M (2021: net asset of €238M) was
recognised on balance sheet in respect of the Group's jet fuel
forward contracts, jet fuel call options, foreign currency
derivative instruments associated with future jet fuel purchases
and carbon credits and a net asset of €705M (2021: net asset
€247M) was recognised in respect of its foreign currency
derivative instruments associated with future aircraft
purchases.
In
determining the hedge effectiveness of derivative instruments used
to hedge Ryanair's fuel requirements, there is significant
judgement involved in assessing whether the volumes of jet fuel
hedged are still expected to be highly probable forecast
transactions. Specifically, significant judgement is required in
respect of the assumptions related to the expected recovery of
passenger demand and the subsequent flight schedules following the
Covid-19 pandemic along with the potential for travel restrictions
to be reimposed. All of these assumptions impact upon forecast fuel
consumption, and minor changes to these assumptions could have a
significant effect on the assessment of hedge
effectiveness.
In
respect of foreign currency hedge effectiveness for future aircraft
purchases, there is a high degree of judgement involved in
assessing whether the future aircraft payments are still considered
highly probable of occurring, and the timing of these future
payments for aircraft. The timing of future payments for aircraft
is dependent on the aircraft manufacturer's ability to meet
forecast aircraft delivery schedules.
As
at September 30, 2022 the Group had entered into forward jet fuel
hedging contracts covering approximately 66% of its estimated
requirements for fiscal year 2023 (with a further 16% covered by
jet fuel call options) and approximately 50% of its estimated
requirements for fiscal year 2024. The Group believes these hedges
(excluding the jet fuel call options) to be effective for hedge
accounting purposes.
Long-lived assets - Useful lives, residual values and
impairment
As
at the half-year ended September 30, 2022, the Group had
€9.28BN of property, plant and equipment long-lived assets,
of which €9.11BN were aircraft and capitalised maintenance.
In accounting for long-lived assets, the Group must make estimates
about the expected useful lives of the assets, the expected
residual values of the assets, the cost of major airframe and
engine overhaul.
In
determining the useful lives and expected residual values of the
aircraft, and the cost of major airframe and engine overhaul, the
Group has based the estimates on a range of factors and
assumptions, including its own historic experience and past
practices of aircraft disposal and renewal programmes, forecasted
growth plans, external valuations from independent appraisers,
recommendations from the aircraft supplier and manufacturer and
other industry available information.
The
Group's estimate of each aircraft's residual value is 15% of the
current market value of new Boeing 737 aircraft, and each
aircraft's useful life is determined to be 23 years. An element of
the cost of an acquired aircraft is attributed on acquisition to
its service potential, reflecting the maintenance condition of its
engines and airframe. This cost, which can equate to a substantial
element of the total aircraft cost, is amortised over the shorter
of the period to the next maintenance check (usually between 8 and
12 years) or the remaining life of the aircraft.
Revisions
to these estimates could be caused by changes to maintenance
programmes, changes in utilisation of the aircraft, governmental
regulations on ageing aircraft, changes in new aircraft technology,
changes in governmental and environmental taxes, changes in new
aircraft fuel efficiency and changing market prices for new and
used aircraft of the same or similar types. The Group therefore
evaluates its estimates and assumptions in each reporting period,
and, when warranted, adjusts these assumptions. Any adjustments are
accounted for on a prospective basis through depreciation
expense.
The
Group evaluates, at the end of each reporting period, whether there
is any indication that its long-lived assets may be impaired.
Factors that may indicate potential impairment include, but are not
limited to, significant decrease in the market value of an aircraft
based on observable information, a significant change in an
aircraft's physical condition and operating or cash flow losses
associated with the use of the aircraft.
3.
Seasonality of operations
The
Group's results of operations have varied significantly from
quarter to quarter, and management expects these variations to
continue. Among the factors causing these variations are the
airline industry's sensitivity to general economic conditions and
the seasonal nature of air travel. Accordingly, the first half-year
has traditionally resulted in higher revenues and
profits.
4.
Income tax expense
The
Group's consolidated tax expense for the half-year ended September
30, 2022 of €159M (tax credit September 30, 2021: €52M)
comprises a current tax charge of €7M and a deferred tax
charge of €152M primarily relating to the temporary
differences for property, plant and equipment and net operating
losses. This consolidated tax charge is the aggregation of
separate tax charges and tax credits on the profits earned and
losses suffered by each of the Group's operating companies
calculated in accordance with differing tax rules and rates
applicable in each jurisdiction where the Group operates. No
significant or unusual tax charges or credits arose during the
period. The effective tax rate of 11% for the half-year
(September 30, 2021: 52%) is the result of the mix of profits and
losses incurred by Ryanair's operating subsidiaries primarily in
Ireland, Malta, Poland and the U.K.
5.
Contingencies
The
Group is engaged in litigation arising in the ordinary course of
its business. The Group does not believe that any such
litigation will individually, or in aggregate, have a material
adverse effect on the financial condition of the Group. Should the
Group be unsuccessful in these litigation actions, management
believes the possible liabilities then arising cannot be determined
but are not expected to materially adversely affect the Group's
results of operations or financial position.
6.
Capital commitments
At September 30, 2022 the Group
had an operating fleet of 486 (2021: 438) Boeing 737 and 29 (2021:
29) Airbus A320 aircraft. In
September 2014, the Group agreed to purchase up to 200 (100 firm
and 100 options) Boeing 737-8200 aircraft which was subsequently
increased to 210 (135 firm and 75 options). In December 2020, the
Group increased its firm orders from 135 to 210 Boeing 737-8200
aircraft. At
September 30, 2022 the Group had taken delivery of 77 of these
aircraft. The
remaining aircraft are due to be delivered before the end of fiscal
year 2025.
7.
Analysis of operating revenues and segmental analysis
The
Group determines and presents operating segments based on the
information that internally is provided to the Group CEO, who is
the Chief Operating Decision Maker (CODM).
The
Group comprises five separate airlines, Buzz, Lauda Europe (Lauda),
Malta Air, Ryanair DAC and Ryanair UK Limited (which is currently
included within Ryanair DAC). Ryanair DAC is reported as a separate
segment as it exceeds the applicable quantitative thresholds for
reporting purposes. Malta Air is reported as
a separate segment as it exceeded the
applicable quantitative thresholds for reporting purposes for the
year ended March 31, 2022, and is included for comparative
purposes. Buzz and Lauda do not individually exceed the
quantitative thresholds and accordingly are presented on an
aggregate basis as they exhibit similar economic characteristics
and their services, activities and operations are sufficiently
similar in nature. The results of these operations are included as
'Other Airlines.'
The
CODM assesses the performance of the business based on the
profit/(loss) after tax of each airline for the reporting period.
Resource allocation decisions for all airlines are based on airline
performance for the relevant period, with the objective in making
these resource allocation decisions being to optimise consolidated
financial results.
Reportable segment information is presented as
follows:
Half-Year
Ended
Ryanair DAC
Malta Air
Other Airlines
Elimination
Total
Sep 30,
Sep 30,
Sep 30,
Sep 30,
Sep 30,
2022
2022
2022
2022
2022
€M
€M
€M
€M
€M
Scheduled revenue
4,346.6
-
78.2
-
4,424.8
Ancillary revenue
2,191.3
-
-
-
2,191.3
Inter-segment revenue
381.6
417.5
231.8
(1,030.9)
-
Segment
revenue
6,919.5
417.5
310.0
(1,030.9)
6,616.1
Reportable segment profit after
income tax (i)
1,343.5
4.9
22.4
-
1,370.8
Other segment information:
Depreciation
427.4
-
25.7
-
453.1
Net finance expense
34.2
-
2.0
-
36.2
Capital expenditure
679.2
-
118.0
-
797.2
Segment assets
16,063.1
87.2
447.0
-
16,597.3
Segment liabilities
9,003.6
97.9
829.7
-
9,931.2
(i) Adjusted profit after tax in the half-year to September 30,
2022, excludes a net exceptional loss after tax of €107.4M,
attributable to the fair value measurement of jet fuel call
options.
Half-Year Ended
Ryanair DAC
Malta Air
Other Airlines
Elimination
Total
Sep 30,
Sep 30,
Sep 30,
Sep 30,
Sep 30,
2021
2021
2021
2021
2021
€M
€M
€M
€M
€M
Scheduled revenue
1,241.4
-
31.9
-
1,273.3
Ancillary revenue
881.6
-
-
-
881.6
Inter-segment revenue
332.6
365.3
184.8
(882.7)
-
Segment
revenue
2,455.6
365.3
216.7
(882.7)
2,154.9
Reportable segment (loss)/profit after income tax
(80.5)
29.6
3.3
-
(47.6)
Other segment information:
Depreciation
307.4
-
28.8
-
336.2
Net finance expense
42.8
-
1.9
-
44.7
Capital expenditure
553.3
-
1.9
-
555.2
Segment assets
13,729.0
95.0
245.5
-
14,069.5
Segment liabilities
8,430.0
87.0
619.6
-
9,136.6
Quarter Ended
Ryanair DAC
Malta Air
Other Airlines
Elimination
Total
Sep 30,
Sep 30,
Sep 30,
Sep 30,
Sep 30,
2022
2022
2022
2022
2022
€M
€M
€M
€M
€M
Scheduled revenue
2,790.5
-
57.9
-
2,848.4
Ancillary revenue
1,166.2
-
-
-
1,166.2
Inter-segment revenue
189.8
212.4
116.8
(519.0)
-
Segment
revenue
4,146.5
212.4
174.7
(519.0)
4,014.6
Reportable segment profit after
income tax (i)
1,188.9
2.4
9.5
-
1,200.8
Other segment information:
Depreciation
215.0
-
11.7
-
226.7
Net finance expense
14.6
-
1.5
-
16.1
Capital expenditure
261.4
-
114.0
-
375.4
Segment assets
16,063.1
87.2
447.0
-
16,597.3
Segment liabilities
9,003.6
97.9
829.7
-
9,931.2
(i) Adjusted profit after tax in the three months to September 30,
2022, excludes a net exceptional loss after tax of €125M,
attributable to the fair value measurement of jet fuel call
options.
Quarter Ended
Ryanair DAC
Malta Air
Other Airlines
Elimination
Total
Sep 30,
Sep 30,
Sep 30,
Sep 30,
Sep 30,
2021
2021
2021
2021
2021
€M
€M
€M
€M
€M
Scheduled revenue
1,055.9
-
25.5
-
1,081.4
Ancillary revenue
703.0
-
-
-
703.0
Inter-segment revenue
135.9
222.7
127.4
(486.0)
-
Segment
revenue
1,894.8
222.7
152.9
(486.0)
1,784.4
Reportable segment profit after
income tax
164.3
32.3
28.4
-
225.0
Other segment information:
Depreciation
187.5
-
14.4
-
201.9
Net finance expense
22.4
-
0.9
-
23.3
Capital expenditure
397.0
-
1.5
-
398.5
Segment assets
13,729.0
95.0
245.5
-
14,069.5
Segment liabilities
8,430.0
87.0
619.6
-
9,136.6
The
following table disaggregates revenue by primary geographical
market. In accordance with IFRS 8 paragraph 13, revenue by country
of origin has been provided where revenue for that country is in
excess of 10% of total revenue. Ireland is presented as it
represents the country of domicile. "Other European countries"
includes all other countries in which the Group has
operations.
Half-Year Ended
Sep 30, 2022
Half-Year Ended
Sep 30, 2021
Quarter Ended
Sep 30, 2022
Quarter
Ended
Sep
30, 2021
€M
€M
€M
€M
Italy
1,460.1
537.8
874.6
422.9
Spain
1,180.0
409.9
712.3
336.7
United
Kingdom
947.6
219.2
565.8
190.4
Ireland
377.6
80.1
223.7
71.5
Other
European countries
2,650.8
907.9
1,638.2
762.9
Total
revenue
6,616.1
2,154.9
4,014.6
1,784.4
Ancillary
revenues comprise of revenues from non-flight scheduled operations,
in-flight sales and Internet related services. Non-flight scheduled
revenue arises from the sale of priority boarding, allocated seats,
car hire, travel insurance, airport transfers, room reservations
and other sources, including excess baggage charges and other fees,
all directly attributable to the low-fares business.
The
vast majority of ancillary revenue is recognised at a point in
time, which is typically the flight date. The economic factors that
would impact the nature, amount, timing and uncertainty of revenue
and cashflows associated with the provision of passenger travel
related ancillary services are homogeneous across the various
component categories within ancillary revenue. Accordingly, there
is no further disaggregation of ancillary revenue required in
accordance with IFRS 15, paragraph 114.
8.
Property, plant and equipment and Right of Use assets
Acquisitions and disposals
During
the half-year ended September 30, 2022, net capital additions
amounted to €0.7BN principally reflecting aircraft deliveries
in the period, aircraft pre-delivery deposits and capitalised
maintenance offset by supplier reimbursements of approximately
€128M. Right of Use assets (reflecting A320 aircraft
operating lease extensions to 2028) increased by €114M in the
period.
9. Financial
instruments and financial risk management
The Group is exposed to various
financial risks arising in the normal course of business. The
Group's financial risk exposures are predominantly related
to commodity
price, foreign exchange and interest rate risks. The Group uses
financial instruments to manage exposures arising from these
risks.
These interim financial
statements do not include all financial risk management information
and disclosures required in the annual financial statements and
should be read in conjunction with the 2022 Annual
Report. There
have been no changes in our risk management policies in the
period.
Fair value hierarchy
Financial
instruments measured at fair value in the balance sheet are
categorised by the type of valuation method used. The different
valuation levels are defined as follows:
●
Level
1: quoted prices (unadjusted) in active markets for identical
assets or liabilities that the Group can access at the measurement
date.
●
Level
2: inputs other than quoted prices included within Level 1 that are
observable for that asset or liability, either directly or
indirectly.
●
Level
3: significant unobservable inputs for the asset or
liability.
Fair value estimation
Fair
value is the price that would be received to sell an asset, or paid
to transfer a liability, in an orderly transaction between market
participants at the measurement date. The following methods and
assumptions were used to estimate the fair value of each material
class of the Group's financial instruments:
Financial instruments measured at fair value
●
Derivatives
- interest rate swaps: Discounted
cash-flow analyses have been used to determine their fair value,
taking into account current market inputs and rates. The Group's
credit risk and counterparty's credit risk is taken into account
when establishing fair value (Level 2).
●
Derivatives
- currency forwards, jet fuel forward contracts and carbon
contracts: A
comparison of the contracted rate to the market rate for contracts
providing a similar risk profile at September 30, 2022 has been
used to establish fair value. The Group's credit risk and
counterparty's credit risk is taken into account when establishing
fair value (Level 2).
●
Derivatives
- jet fuel call options: The
fair value of jet fuel call options is determined based on market
accepted valuation techniques, primarily Black-Scholes modelling
(Level 2).
The
Group policy is to recognise any transfers between levels of the
fair value hierarchy as of the end of the reporting period during
which the transfer occurred. During the quarter ended September 30,
2022, there were no reclassifications of financial instruments and
no transfers between levels of the fair value hierarchy used in
measuring the fair value of financial instruments.
●
Financial
instruments not measured at fair value
●
Long-term
debt: The
repayments which the Group is committed to make have been
discounted at the relevant market rates of interest applicable
(including credit spreads) at September 30, 2022 to arrive at a
fair value representing the amount payable to a third party to
assume the obligations.
As
at the end of the second quarter of fiscal year 2023, the future
outlook for the business is such that there has been no material
change to the fair values of financial assets and financial
liabilities.
The
fair value of financial assets and financial liabilities, together
with the carrying amounts in the condensed consolidated balance
sheet, are as follows:
At Sep 30,
At
Sep 30,
At Mar
31,
At Mar
31,
2022
2022
2022
2022
Carrying
Fair
Carrying
Fair
Amount
Value
Amount
Value
Non-current financial assets
€M
€M
€M
€M
Derivative
financial instruments:
- U.S.
dollar currency forward contracts
308.7
308.7
160.4
160.4
- Jet
fuel & carbon derivative forward contracts
-
-
22.2
22.2
-
Interest rate swaps
4.1
4.1
2.5
2.5
312.8
312.8
185.1
185.1
Current financial assets
Derivative
financial instruments:
- U.S.
dollar currency forward contracts
688.7
688.7
313.7
313.7
- Jet
fuel options
25.9
25.9
150.5
150.5
- Jet
fuel & carbon derivative forward contracts
439.0
439.0
934.1
934.1
-
Interest rate swaps
3.9
3.9
2.1
2.1
1,157.5
1,157.5
1,400.4
1,400.4
Trade
receivables*
78.0
43.5
Cash
and cash equivalents*
1,724.2
2,669.0
Financial
asset: cash > 3 months*
2,844.7
934.1
Restricted
cash*
22.7
22.7
5,827.1
1,157.5
5,069.7
1,400.4
Total financial assets
6,139.9
1,470.3
5,254.8
1,585.5
At Sep 30,
At
Sep 30,
At Mar
31,
At Mar
31,
2022
2022
2022
2022
Carrying
Fair
Carrying
Fair
Amount
Value
Amount
Value
Non-current
financial liabilities
€M
€M
€M
€M
Derivative
financial instruments:
- Jet
fuel & carbon derivative forward contracts
115.3
115.3
-
-
Non-current
maturities of debt:
-
Long-term debt
871.2
871.8
924.8
927.1
-
Promissory notes
153.0
153.0
-
-
-
Bonds
2,043.0
1,867.9
2,789.8
2,792.1
3,067.2
2,892.7
3,714.6
3,719.2
Trade
payables
51.3
51.3
49.2
49.2
3,233.8
3,059.3
3,763.8
3,768.4
Current financial liabilities
Derivative
financial instruments:
- Jet
fuel & carbon derivative forward contracts
114.7
114.7
7.6
7.6
- U.S.
dollar currency forward contracts
24.7
24.7
31.0
31.0
139.4
139.4
38.6
38.6
Current
maturities of debt:
-
Short-term debt
130.6
130.6
152.1
152.1
-
Promissory notes
102.1
102.1
225.9
225.9
-
Bonds
1,596.4
1,575.6
846.5
855.0
1,829.1
1,808.3
1,224.5
1,233.0
Trade
payables*
1,225.4
1,029.0
Accrued
expenses*
1,257.4
953.0
4,451.3
1,947.7
3,245.1
1,271.6
Total
financial liabilities
7,685.1
5,007.0
7,008.9
5,040.0
*The fair value of each of these financial instruments approximate
their carrying values due to the short-term nature of the
instruments
During
the year ended March 31, 2022, the Group issued promissory notes
with a cumulative value of €226M, that mature between
December 2022 and October 2023. These notes were issued in
settlement of certain aircraft trade payables and are non-interest
bearing. The carrying value of the promissory notes is not
considered to be materially different from its fair
value.
10. Shareholders'
equity and shareholders' returns
During
the half-year ended September 30, 2022 2.6M ordinary shares were
issued at strike prices between €6.25 and €8.35 per
share following the exercise of vested options for total proceeds
of €19M. There were no shareholder returns during the
half-year ended September 30, 2022.
11. Related
party transactions
The
Company's related parties comprise its subsidiaries, Directors and
key management personnel. All transactions with subsidiaries
eliminate on consolidation and are not disclosed.
There
were no related party transactions in the half-year ended September
30, 2022 that materially affected the financial position or the
performance of the Group during that period and there were no
changes in the related party transactions described in the 2022
Annual Report that could have a material effect on the financial
position or performance of the Group in the same
period.
12. Post
balance sheet events
There
were no significant post balance sheet events.
Ryanair Holdings plc and Subsidiaries
Responsibility Statement
Statement of the Directors in respect of the interim financial
report
The
Directors are responsible for preparing the half-yearly financial
report in accordance with the Transparency (Directive 2004/109/EC)
Regulations 2007 ("Transparency Directive"), and the Transparency
Rules of the Central Bank of Ireland.
In
preparing the condensed set of consolidated interim financial
statements included within the half-yearly financial report, the
Directors are required to:
●
prepare
and present the condensed set of financial statements in accordance
with IAS 34 Interim
Financial Reporting as adopted by the EU, the
Transparency Directive and the Transparency Rules of the Central
Bank of Ireland;
●
ensure
the condensed set of financial statements has adequate
disclosures;
●
select
and apply appropriate accounting policies; and
●
make
accounting estimates that are reasonable in the
circumstances.
The
Directors are responsible for designing, implementing and
maintaining such internal controls as they determine is necessary
to enable the preparation of the condensed set of financial
statements that is free from material misstatement whether due to
fraud or error.
We
confirm that to the best of our knowledge:
(1) the condensed set of consolidated
interim financial statements included within the half-yearly
financial report of Ryanair Holdings plc for the six months ended
September 30, 2022 ("the interim financial information") which
comprises the condensed consolidated interim balance sheet,
the condensed consolidated interim income statement, the condensed
consolidated interim statement of comprehensive income, the
condensed consolidated interim statement of cash flows and the
condensed consolidated interim statement of changes in
shareholders' equity and the related explanatory notes, have been
presented and prepared in accordance with IAS
34 Interim Financial
Reporting, as adopted by the
EU, the Transparency Directive and Transparency Rules of the
Central Bank of Ireland.
(2)
The interim financial information presented, as required by the
Transparency Directive, includes:
a.
an indication of important events that have occurred during the
first 6 months of the financial year, and their impact on the
condensed set of consolidated interim financial
statements;
b.
a description of the principal risks and uncertainties for the
remaining 6 months of the financial year
c.
related parties' transactions that have taken place in the first 6
months of the current financial year and that have materially
affected the financial position or the performance of the
enterprise during that period; and
d.
any changes in the related parties' transactions described in the
last annual report that could have a material effect on the
financial position or performance of the enterprise in the first 6
months of the current financial year.
On
behalf of the Board
Stan
McCarthy
Michael O'Leary
Chairman
Chief Executive
November
4, 2022
Independent review report to Ryanair Holdings plc
Report on the condensed consolidated interim financial
statements
We
have reviewed Ryanair Holdings plc's condensed consolidated interim
financial statements (the "interim financial statements") in the
half-yearly financial report of Ryanair Holdings plc for the period
ended September 30, 2022 (the "period").
Based
on our review, nothing has come to our attention that causes us to
believe that the interim financial statements are not prepared, in
all material respects, in accordance with International Accounting
Standard 34, 'Interim Financial Reporting', as adopted by the
European Union and the Transparency (Directive 2004/109/EC)
Regulations 2007 and the Central Bank (Investment Market Conduct)
Rules 2019.
The
interim financial statements comprise:
● the
condensed consolidated interim balance sheet as at September 30,
2022 on page 1;
● the
condensed consolidated interim income statement and condensed
consolidated interim statement of comprehensive income for the six
months then ended on pages 2 and 4;
● the
condensed consolidated interim income statement and condensed
consolidated interim statement of comprehensive income for the
three months then ended on pages 3 and 4;
● the
condensed consolidated interim statement of cash flows for the
period then ended on page 5;
● the
condensed consolidated interim statement of changes in
shareholders' equity for the period then ended on page 6;
and
● the
Notes forming Part of the Condensed Consolidated Interim Financial
Statements on pages 13 to 22. The MD&A Half-Year Ended
September 30, 2022, MD&A Quarter Ended September 30, 2022 and
Interim Management Report included in the half-yearly report on
pages 7 to 12 do not form part of the interim financial
statements.
The
interim financial statements included in the half-yearly financial
report have been prepared in accordance with International
Accounting Standard 34, 'Interim Financial Reporting', as adopted
by the European Union and the Transparency (Directive 2004/109/EC)
Regulations 2007 and the Central Bank (Investment Market Conduct)
Rules 2019.
As
disclosed in note 1 to the interim financial statements, the
financial reporting framework that has been applied in the
preparation of the full annual financial statements of the Group is
applicable law, International Financial Reporting Standards (IFRSs)
as adopted by the European Union and IFRSs as issued by the
International Accounting Standards Board.
We
conducted our review in accordance with International Standard on
Review Engagements (Ireland) 2410, 'Review of Interim Financial
Information Performed by the Independent Auditor of the Entity'
("ISRE (Ireland) 2410") issued for use in Ireland. A review of
interim financial information consists of making enquiries,
primarily of persons responsible for financial and accounting
matters, and applying analytical and other review
procedures.
A review is substantially less in
scope than
an audit conducted in accordance with International Standards on
Auditing (Ireland) and, consequently,
does not enable
us to obtain assurance that we would become aware of all
significant matters that might be identified in an audit.
Accordingly, we do not express an audit
opinion.
We
have read the other information contained in the half-yearly
financial report and considered whether it contains any apparent
misstatements or material inconsistencies with the information in
the interim financial statements.
Based
on our review procedures, which are less extensive than those
performed in an audit as described in the Basis for conclusion
section of this report, nothing has come to our attention to
suggest that the Directors have inappropriately adopted the going
concern basis of accounting or that the Directors have identified
material uncertainties relating to going concern that are not
appropriately disclosed.
This
conclusion is based on the review procedures performed in
accordance with ISRE (Ireland) 2410. However future events or
conditions may cause the Group to cease to continue as a going
concern.
Responsibilities for the interim financial statements and the
review
Our responsibilities and those of the Directors
The
half-yearly financial report, including the interim financial
statements, is the responsibility of, and has been approved by, the
Directors. The Directors are responsible for preparing the
half-yearly financial report in accordance with the Transparency
(Directive 2004/109/EC) Regulations 2007 and the Central Bank
(Investment Market Conduct) Rules 2019. In preparing the
half-yearly financial report including the interim financial
statements, the Directors are responsible for assessing the Group's
ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis
of accounting unless the Directors either intend to liquidate the
Group or to cease operations, or have no realistic alternative but
to do so.
Our
responsibility is to express a conclusion on the interim financial
statements in the half-yearly financial report based on our review.
Our conclusion, including our Conclusions relating to going
concern, is based on procedures that are less extensive than audit
procedures, as described in the Basis for conclusion paragraph of
this report. This report, including the conclusion, has been
prepared for and only for the Company for the purpose of complying
with the Transparency (Directive 2004/109/EC) Regulations 2007 and
the Central Bank (Investment Market Conduct) Rules 2019 and for no
other purpose. We do not, in giving this conclusion, accept or
assume responsibility for any other purpose or to any other person
to whom this report is shown or into whose hands it may come save
where expressly agreed by our prior consent in
writing.
PricewaterhouseCoopers
Chartered
Accountants
4
November 2022
Dublin
●
The maintenance and
integrity of the Ryanair Holdings plc website is the responsibility
of the Directors; the work carried out by the auditors does not
involve consideration of these matters and, accordingly, the
auditors accept no responsibility for any changes that may have
occurred to the financial statements since they were initially
presented on the website.
● Legislation
in the Republic of Ireland governing the preparation and
dissemination of financial statements may differ from legislation
in other jurisdictions.
[1] Sustainalytics
- a leading independent ESG & corporate governance research,
ratings & analytics firm.
[2] Science
Based Targets initiative - a collaboration between CDP, the United
Nations Global Compact, World Resources Institute & the
Worldwide Fund for Nature. It helps companies to set emission
reduction targets in line with climate science & the Paris
Agreement goals.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, hereunto duly authorized.