Despite overcapacity in Europe, rising fuel prices and major pilot scheduling problems last September, Ryanair (RYA) reported a 10 per cent rise in post-tax profits to €1.45bn (£1.27bn) for the year to March 2018. This came after lower fares triggered a 9 per cent increase in traffic to more than 130m passengers, meaning the group saw an “industry leading” load factor (utilisation rate) of 95 per cent.
Costs fell by 1 per cent, helped by fuel hedging, but excluding fuel they were up by 3 per cent – stemming from the aforementioned pilot issues, which caused flight cancellations, and higher second-half staff costs driven by pay rises and five-year pay deals.
These results were satisfactory given the circumstances, but management’s outlook for the 2019 financial year is “on the pessimistic side of cautious”. Traffic should grow by 7 per cent to 139m, but costs are set to rise by 9 per cent. Higher staff and oil prices will add over €400m to Ryanair’s fuel bill. In all, profits are expected to fall to between €1.25bn and €1.35bn.
According to Bloomberg’s consensus average, analysts expect adjusted EPS of 122¢ for the year to March 2019 (flat on FY2018).
| RYANAIR (RYA) | ||||
| ORD PRICE: | 1,589¢ | MARKET VALUE: | €18.4bn | |
| TOUCH: | 1,589-1,590¢ | 12-MONTH HIGH: | 1,978¢ | LOW: 1,422¢ |
| DIVIDEND YIELD: | nil | PE RATIO: | 13 | |
| NET ASSET VALUE: | 385¢ | NET DEBT: | 6.3% | |
| Year to 31 Mar | Turnover (€bn) | Pre-tax profit (€bn) | Earnings per share (¢) | Dividend per share (¢) |
| 2014 | 5.04 | 0.59 | 37.0 | nil |
| 2015 | 5.65 | 0.98 | 62.6 | nil |
| 2016* | 6.54 | 1.72 | 116 | nil |
| 2017 | 6.65 | 1.47 | 105 | nil |
| 2018 | 7.15 | 1.61 | 122 | nil |
| % change | +8 | +10 | +16 | - |
| Ex-div: | na | |||
| Payment: | na | |||
| *Excludes €398m cash return paid in November 2015. £1=€1.14 | ||||
