Belfast Telegraph

Ryanair in €500m dividend bonanza

By Symon Ross

Ryanair is to pay an unprecedented €500m dividend to its shareholders after surging back into the black in its latest financial year.

The Dublin-based budget airline, which flies from Belfast City Airport, said yesterday that its pre-tax profits tripled to nearly €341m (£281m), up from a €180.5m loss the year before.

Ryanair also confirmed the planned payment this October of a €500m dividend to shareholders - the first time in the airline's 25-year history that such a payment is being made.

Controversial boss Michael O'Leary - who owns 4% of shares in the airline - will pocket nearly €20m as part of the payment.

The carrier will also make another dividend payment of €500m in 2013 if it doesn't ink a deal by next year to buy more aircraft.

Given that Ryanair and Boeing pulled the plug late last year on fraught negotiations for 100 firm aircraft orders and 100 options, it is almost a certainty that the additional money will be handed over to the airline's shareholders.

Deputy chief executive Michael Cawley said Ryanair wasn't actively pursuing additional negotiations with Boeing, but also added that shareholders shouldn't have an expectation of additional dividend payments beyond 2013.

Ryanair's profits jumped after it continued to reduce overall unit costs, excluding fuel, by 3% during its 2010 financial year and fuel costs slumped 29% to €894m.

Total revenue rose 2% to €2.94bn for the year, with ancillary revenues climbing nearly 11% to €663m. Those ancillary revenues are generated from anything from cups of tea sold to passengers, to baggage charges.

Profits were ahead of analyst predictions and the airline's own expectations. In February, Ryanair boosted its full-year profit guidance from the low end of a €200m-€300m range to about €275m for the period.

By April, Ryanair had been pencilling in a figure of not less than €310m. Ryanair is typically conservative in its outlook, however.

It is forecasting pre-exceptional net profit of between €350m and €375m for the financial year.

Mr Cawley said that average fares are set to rise by 5%-10%.

Shares in Ryanair closed up 4.4% in Dublin at €3.53.