2nd Aug 2005 07:00
Ryanair Holdings PLC02 August 2005 RYANAIR ANNOUNCE RECORD Q1 RESULTS NET PROFIT RISES 21% TO €64.4m - TRAFFIC GROWS 30% TO 8.5M Ryanair, Europe's No.1 low fares airline, today (2 August 2005) announced recordprofits of €64.4m for the Quarter ended 30 June 2005. Traffic grew by 30% to8.5m passengers, yields increased by 3% and, as a result, total revenues rose by35% to €404.6m. Unit costs increased by 6% (excluding fuel they fell by 9%) asfuel costs rose by 112% to €109.9m. As a result, Ryanair's adjusted after taxmargin for the Quarter fell by 2 points to 16% as Adjusted Net Profit increasedby 21% to €64.4m. Summary Table of Results (IFRS) - in Euro Quarter Ended June 30, 2004 June 30,2005 % Increase Passengers 6.6m 8.5m +30%Revenue €299.6m €404.6m +35%Profit after tax (Note 1) €53.1m €64.4m +21%Basic EPS (Euro Cents)(Note 1) 6.99c 8.47c +21% Note 1:Adjusted profit after tax and EPS during the Quarter ended 30June 2005 excludes a receipt, net of tax, of €5.2m arising from thesettlement of an insurance claim for the scribing of 6 Boeing 737-200aircraft. Announcing these results Ryanair's Chief Executive, Michael O'Leary, said: "These record quarterly results reflect the disciplined and successful roll-outof Ryanair's low fares model across Europe. The increased profits during theQuarter - despite the fact that Easter fell in the prior Quarter - underlinesthe fundamental strength of the Ryanair low fares model, which deliversprofitable growth even during periods of intense competition and significantlyhigher oil prices. "Yields were 3% higher than last year - slightly better than anticipated -despite a 30% increase in seat capacity. These higher yields were primarily dueto the multiple fuel surcharges imposed by the European flag carriers on theirshort haul passengers, with the latest round of increases imposed in June. Thesesurcharges continue to widen the gap between their high fares and Ryanair's lowfares. Both Ryanair's traffic growth (+30%) and yields (+3%) have significantlybenefited from our commitment not to impose fuel surcharges on our passengers. "Bookings were down for a number of days in the immediate aftermath of each ofthe two terrorist attacks in London on the 7th and 21st of July. If there are nofurther such attacks in London then we expect that our forward bookings will notbe materially impacted. However, if there are further incidents in London, bothbookings and yields could be adversely impacted. "During the Quarter fuel costs rose by 112% to €109.9m. Fuel prices continue tobe high and the market remains volatile. We are unhedged for August but havehedged 90% of our September volumes at $57 per barrel. Thereafter, we are 90%hedged for the Winter period (October 2005 to March 2006) at rates equivalent to$49 per barrel and we continue to closely monitor forward prices with a view tohedging some or all of our requirements for the early part of Summer 2006. "Our new routes and bases have developed well over the Summer. Both our Lutonand Liverpool bases are performing strongly and traffic at our Shannon base isrunning ahead of expectations, although yields continue to be slightly lowerthan expected. We recently announced our 14th European base at Pisa in Italy. Wewill initially locate 2 aircraft there and have launched a further 3 new routesfrom Pisa to Alghero, Dublin and Eindhoven bringing the total routes operated to/from Pisa to 10. Our growth continues in the UK with 2 new routes from LondonStansted to Toulon in France and Krakow in Poland. We will add a fifth aircraftto our Liverpool base from the end of September and will launch 4 new routes toOslo in Norway, Riga in Latvia, and Bergerac and Carcassone in France. From ourShannon base, we have recently announced 2 new routes to Bristol in the UK andNantes in France. "During the Quarter we exercised 5 Boeing 737-800 options for delivery in 2007,1 in February, 1 in March, 1 in April and 2 in May as we continue to see manymore growth opportunities across Europe. The Boeing 737-800 offers Ryanair thelowest unit operating cost per seat, as well as the technical reliability tomaintain our number 1 on-time performance of any major airline in Europe. "In Ireland, passengers at Dublin Airport continue to endure third worldfacilities. Despite this, the ineffective Regulator is proposing to allowairport charges to rise by up to 40%. The Regulator has consistently failed toaddress the 50% efficiency gap he identified at Dublin Airport 4 years ago, andis bizarrely proposing to approve capital expenditure for facilities, which donot have the support of the airline users at the airport. These expenditureproposals include the construction of a second runway, which is not requireduntil Dublin's traffic reaches 35m passengers per year (currently at 17m). TheGovernment has also nominated the inefficient Dublin Airport Authority to builda second terminal despite the unanimous support of airlines and passengers foran independent competing terminal. Ryanair has initiated legal proceedings toforce the Government to honour a commitment to open up this inefficient airportmonopoly to competition. "Our outlook for the remainder of the year is cautious as we continue to budgetfor higher oil prices but anticipate that these will be partly offset by acombination of other cost reductions and the current benign yield environment.Our competitors imposition of further fuel surcharges (up to four in the case ofBA) on their passengers and their removal of capacity from markets is positivefor yields, and we still plan to grow traffic by approximately 27% to 35mpassengers this year. However, further terrorist attacks in London could have adownward impact on passenger volumes and yields, although, at this early stagewe see no reason to revise our guidance. We anticipate there will be continuedintense competition and that there will be fewer low fare carriers in theEuropean market as higher fuel prices force loss making carriers out of theindustry. Ryanair's unique combination of the lowest costs, the lowest fares,and industry leading customer service will, we believe, ensure that Ryanaircontinues to grow profitability to the benefit of all our European passengers,our people and our shareholders". Dublin 02.08.05ENDS. For results and further information Howard Millar Pauline McAlesterplease contact: Ryanair Holdings Plc Murray Consultants www.Ryanair.com Tel: 353-1-8121212 Tel: 353-1-4980300 Certain of the information included in this release is forward looking and issubject to important risks and uncertainties that could cause actual results todiffer materially. It is not reasonably possible to itemise all of the manyfactors and specific events that could affect the outlook and results of anairline operating in the European economy. Among the factors that are subject tochange and could significantly impact Ryanair's expected results are the airlinepricing environment, fuel costs, competition from new and existing carriers,market prices for replacement aircraft, costs associated with environmental,safety and security measures, actions of the Irish, U.K., European Union ("EU")and other governments and their respective regulatory agencies, fluctuations incurrency exchange rates and interest rates, airport access and charges, labourrelations, the economic environment of the airline industry, the generaleconomic environment in Ireland, the UK and Continental Europe, the generalwillingness of passengers to travel and other economics, social and politicalfactors. Ryanair is Europe's largest low fares airline with 14 bases and 250 low fareroutes across 21 countries. By the end of 2005 Ryanair will operate an entirefleet of 96 new Boeing 737-800 aircraft with firm orders for a further 134 newaircraft, which will be delivered over the next 7 years. Ryanair currentlyemploys a team of 2,700 people and expect to carry approximately 35 millionscheduled passengers in the current year. Ryanair Holdings plc and SubsidiariesConsolidated Income Statement in accordance with IFRS (unaudited) Quarter Quarter ended ended June 30, 2005 June 30,2004 •'000 •'000Operating revenuesScheduled revenues 346,286 259,059 Ancillary revenues 58,352 40,531Total operating revenues -continuing operations 404,638 299,590 Operating expensesStaff costs 42,152 34,122Depreciation and amortisation 26,977 23,571Other operating expenses Fuel & Oil 109,906 51,842 Maintenance,materials and repairs 13,838 14,073 Marketing and distribution costs 5,342 7,266 Aircraft rentals 10,058 8,084 Route charges 41,370 33,205 Airport and Handling charges 54,574 44,270 Other 20,537 18,416 Total operating expenses 324,754 234,849 Operating profit before exceptional items 79,884 64,741Aircraft insurance claim 5,939 - Operating profit after exceptional items 85,823 64,741 Other (expenses)/incomeForeign exchange gains 944 120Gain on disposal of fixed assets - 6Interest receivable and similar income 8,610 6,059Interest payable and similar charges (18,435) (12,662)Total other (expenses)/income (8,881) (6,477) Profit before taxation 76,942 58,264Tax on profit on ordinary activities (7,301) (5,188) Profit for the period 69,641 53,076 Earnings per ordinary share -Basic (Euro cent) 9.16 6.99 -Diluted (Euro cent) 9.12 6.96Adjusted earnings per ordinary share* -Basic (Euro cent) 8.47 6.99 -Diluted (Euro cent) 8.44 6.96Number of ordinary shares (in 000's) -Basic 760,519 759,280 -Diluted 763,554 762,162* Calculated on profit for the period before exceptional items (net of tax). Ryanair Holdings plc and SubsidiariesConsolidated Balance Sheets in accordance with IFRS (unaudited) June 30, 2005 March 31, 2005 •'000 •'000Non-current assetsIntangible assets 46,841 46,841Tangible assets 2,078,724 2,092,283Deferred tax 23,283 1,328 Total non-current assets 2,148,848 2,140,452 Current assetsInventories 29,667 28,069Other assets 24,135 24,612Accounts receivable 19,414 20,644Derivative financial instruments 68,358 -Restricted cash 204,040 204,040Financial assets:cash ondeposit for greater than 3months 431,611 529,407Cash and cash equivalents 1,150,804 872,258 Total current assets 1,928,029 1,679,030 Total assets 4,076,877 3,819,482 Current liabilitiesAccounts payable 67,047 92,118Accrued expenses and other liabilities 528,963 414,997Current maturities of long term debt 118,664 120,997Current tax 19,760 21,190 Total current liabilities 734,434 649,302 Other liabilitiesProvisions for liabilities and charges 9,608 7,236 Derivative financial instruments 175,640 -Deferred tax 117,965 105,509Other creditors 72,753 29,072Long term debt 1,267,457 1,293,860 Total other liabilities 1,643,423 1,435,677 Shareholders' funds - equityCalled - up share capital 9,730 9,675Share premium account 574,889 565,756Profit and loss account 1,228,225 1,158,584Other reserves (113,824) 488 Shareholders' funds - equity 1,699,020 1,734,503 Total liabilities and shareholders' funds 4,076,877 3,819,482 Ryanair Holdings plc and SubsidiariesConsolidated Cashflow Statement in accordance with IFRS (Unaudited) Quarter Quarter June 30, June 30, 2005 2004 •'000 •'000 Operating activitiesProfit before taxation 76,942 58,264 Adjustments to reconcile profits before taxto net cash provided by operating activities Depreciation 26,977 23,571(Increase) in inventories (1,598) (676)Decrease in accounts receivable 1,230 930Decrease/(increase) in other current assets 4,626 (192)(Decrease)/increase in accounts payable (25,071) 11,405Increase in accrued expenses 112,833 53,851Increase/(decrease) in other creditors 19,988 (518)Increase in maintenance provisions 2,372 1,486Interest receivable (4,149) 175Interest payable 994 (156)Salary costs 139 47Share based payment 293 -Income tax (1,860) - Net cash provided by operating activities 213,716 148,187 Investing activitiesCapital expenditure (13,418) (60,457)Financial assets: cash > 3months 97,796 155,318 84,378 94,861 Financing activitiesNet proceeds from shares issued 9,188 154Repayment of long debt (28,736) (19,514) Net cash used in financing activities (19,548) (19,360) Increase in cash and cash equivalents 278,546 223,688 Cash and cash equivalents at beginning of period 872,258 744,260 Cash and cash equivalents at end of period 1,150,804 967,948 Ryanair Holdings plc and SubsidiariesConsolidated Statement of Changes in Shareholders' Funds - Equityin accordance with IFRS (unaudited) Share Profit Ordinary premium and loss Other shares account account reserves Total •'000 •'000 •'000 •'000 •'000 Balance at April 1,2005 9,675 565,756 1,158,584 488 1,734,503 Issue of ordinary equity shares 55 9,133 - - 9,188 Movement in reserves - - - (114,312) (114,312)Profit for the period - - 69,641 - 69,641 Balance at June 30,2005 9,730 574,889 1,228,225 (113,824) 1,699,020 Reconciliation of adjusted earnings per share(unaudited) Quarter Quarter ended ended June 30, June 30, 2005 2004 •'000 •'000 Profit for the quarter under IFRS 69,641 53,076 AdjustmentsAircraft Insurance Claim (5,939) -Taxation adjustment for above 742 - Adjusted profit under IFRS 64,444 53,076 Number of ordinary shares (in 000's) -Basic 760,519 759,280 -Diluted 763,554 762,162 Adjusted earnings per ordinary share -Basic(•cent) 8.47 6.99 -Diluted(•cent) 8.44 6.96 Ryanair Holdings plc and SubsidiariesConsolidated Income Statement in accordance with US GAAP (unaudited) Quarter Quarter ended ended June 30, 2005 June 30, 2004 •'000 •'000 Operating revenuesScheduled revenues 346,286 259,059Ancillary revenues 58,352 40,531Total operatingrevenues-continuing operations 404,638 299,590 Operating expensesStaff costs 41,776 34,082Depreciation and amortisation 27,269 23,571Other operating expenses Fuel & Oil 109,906 51,842 Maintenance, materials and repairs 13,838 14,073 Marketing and distribution costs 5,342 7,266 Aircraft rentals 10,058 8,084 Route charges 41,370 33,205 Airport and Handling charges 54,574 44,270 Other 20,515 18,394 Total operating expenses 324,648 234,787 Operating profit before exceptional items 79,990 64,803Aircraft insurance claim 5,939 -Operating profit after exceptional items 85,929 64,803 Other (expenses)/incomeForeign exchange gains 944 120Gain on disposal of fixed assets - 6Interest receivable and similar income 8,610 6,059Interest payable and similar charges (16,902) (10,762) Total other (expenses)/income (7,348) (4,577) Income before taxation 78,581 60,226Taxation (7,540) (5,430) Net income 71,041 54,796Net income per ADS -Basic (Euro cent) 46.71 36.08 -Diluted (Euro cent) 46.52 35.95 Adjusted net income per ADS * -Basic (Euro cent) 43.29 36.08 -Diluted (Euro cent) 43.12 35.95 Weighted Average number of shares -Basic 760,519 759,280 -Diluted 763,554 762,162* Calculated on net income before non-recurring items(net of tax).(5 ordinary shares equal 1 ADR) Ryanair Holdings plc and SubsidiariesSummary of significant differences between IFRS and US generally accepted accounting principles (unaudited) (A) Net income under US GAAP Quarter ended June 30, June 30, 2005 2004 •'000 •'000 Net income in accordance with IFRS 69,641 53,076 AdjustmentsPension 83 40Share based payments 293 -Capitalised interest (net of amortisation)regarding aircraft acquisition programme 1,241 1,900Darley Investments Limited 22 22Taxation - effect of above adjustments (239) (242) Net income under US GAAP 71,041 54,796 (B) Consolidated Cashflow Statements in accordance with US GAAP June 30, June 30, 2005 2004 •'000 •'000 Cash inflow from operating activities 213,716 148,187Cash inflow from investing activities 84,378 94,861Cash (outflow)from financing activities (19,548) (19,360) Increase in cash and cash equivalents 278,546 223,688Cash and cash equivalents at beginning of year 872,258 744,260 Cash and cash equivalents at end of period 1,150,804 967,948 Cash and cash equivalents under US GAAP 1,150,804 967,948Restricted cash 204,040 200,000Deposits with a maturity of between three and six months 431,611 157,427 Cash and liquid resources under IFRS 1,786,455 1,325,375 Ryanair Holdings plc and SubsidiariesSummary of significant differences between IFRS and US generallyaccepted accounting principles (unaudited) (C) Shareholders' funds - equity June 30, June 30, 2005 2004 •'000 •'000Shareholders' equity as reported in the consolidated balance sheets (IFRS) 1,699,020 1,505,370 Adjustments:Pension 11,788 8,730Share Based payments 293 - Capitalised interest (net of amortisation)regarding aircraft acquisition programme 24,188 19,402Darley Investments Limited (41) (129)Minimum pension liability (net of tax) (6,496) (2,631)Unrealised losses on derivative financialinstruments (net of tax) - (91,730)Tax effect of adjustments (excluding pension & derivative adjustments) (5,235) (2,830) Shareholders' equity as adjusted to accord withUS GAAP 1,723,517 1,436,182Opening shareholders'equity under US GAAP 1,629,819 1,356,281 Comprehensive Income Unrealised gains on derivative financialinstruments (net of tax) 13,469 24,951Net income in accordance with US GAAP 71,041 54,796Total Comprehensive Income 84,510 79,747 Stock issued for cash 9,188 154 Closing shareholders'equity under US GAAP 1,723,517 1,436,182 Ryanair Holdings plc Management Discussion and Analysis of Results Introduction For the purposes of the MD&A all figures and comments are by reference to theadjusted income statement excluding exceptional items referred to below. Exceptional items for quarter ended June 30, 2005 consisted of a receipt of€5.2m (net of tax) arising from the settlement of an insurance claim for thescribing of 6 Boeing 737-200 aircraft. Profit after tax increased by 31% to €69.6m compared to €53.1m in the previousquarter ended June 30, 2004. The adjusted profit for the quarter, excludingexceptional items, increased by 21% to €64.4m. The results for the quarter and comparative year have been prepared inaccordance with International Financial Reporting Standards ("IFRS") accountingpolicies expected to be adopted in the annual financial statements for the yearended 31 March 2006, and a detailed explanation of the financial impact of theadoption of these policies is set out in a separate document issued with thesequarterly financial results for the period to 30 June 2005. A reconciliationbetween the Net Income and Shareholders equity under IFRS and Irish/UK GAAP isattached in Note 2 to this Management Discussion & Analysis. Summary Quarter ended June 30, 2005 Profit after tax increased by 21% to €64.4m, compared to €53.1m in the previousquarter ended June 30, 2004. Total operating revenues increased by 35% to€404.6m, which was faster than the 30% growth in passenger volumes, as averagefares rose by 3% and ancillary revenues grew by 44% to €58.4m. Total revenue perpassenger as a result increased by 4% whilst load factors remained at 83%. Total operating expenses increased by 38% to €324.8m, due to the increased levelof activity, and the increased costs, primarily fuel, route charges and airport& handling costs associated with the growth of the airline. Fuel, our largestcost item, increased by 112% to €109.9m due to substantial increases in the US$cost per gallon, partially offset by the strengthening of the Euro to the US$. Due to the significantly higher fuel costs, Operating margins declined by 2points to 20%, which in turn resulted in Operating profit increasing by 23% to€79.9m. Profit before tax increased by 22%, less than the increase in operating profitdue to the higher net interest charges arising from the increased level of debt,partially offset by foreign exchange gains which arose from the translation offoreign currency bank balances to Euro at the quarter end exchange rates. Totalunit costs increased by 6% driven by the 112% increase in fuel costs to €109.9m.Excluding fuel costs, total unit costs fell by 9%. Net Margins declined by 2 points to 16% for the reasons outlined above andAdjusted basic earnings per share increased by 21% to 8.47 cent for the Quarter. Balance Sheet The Company's increase in profitability continues to generate strong cashflowsfrom operations, which for the quarter ended June 30, 2005 amounted to €213.7m.This cashflow funded additional aircraft deposits whilst the balance isreflected in the €180.8m increase in Total Cash since March 31, 2005 to€1,786.5m. The Company had no material capital expenditure during the quarterwhilst Long Term Debt, net of repayments, reduced by €28.7m. Shareholders' Fundsat June 30, 2005 have reduced by €35.5m to €1,699.0m, compared to March 31, 2005reflecting the increase in profitability during the quarter of €64.4m offset bya reduction of €114.6m resulting from changes in the accounting treatment forderivative financial instruments following the adoption of IFRS. Detailed Discussion and Analysis Quarter ended June 30, 2005 Profit after tax increased by 21% to €64.4m due to a 3% increase in averagefares and strong ancillary revenue growth, which was more than offset by fuelcosts increasing by 112% to €109.9m reflecting the higher US$ cost per gallon.Operating margins, as a result, fell by 2 points to 20%, which in turn resultedin Operating profit increasing by 23% to €79.9m compared to the previousquarter. Total operating revenues increased by 35% to €404.6m whilst passenger volumesincreased by 30% to 8.5m. Total revenue per passenger increased by 4% in thequarter due to a combination of higher average fares and strong ancillaryrevenue growth. Scheduled passenger revenues increased by 34% to €346.3m due to a combination ofa 3% improvement in average fares, increased passenger volumes on existingroutes, and the successful launch of new routes and the new bases at Shannon,Liverpool and Luton. Load factors remained at 83% for the quarter. Ancillary revenues increased by 44% to €58.4m, significantly faster than thegrowth in passenger volumes reflecting a strong performance in non-flightscheduled revenues, car hire and other ancillary products. Ancillary revenuesnow account for 14.4% of total revenues in the quarter compared to 13.5% in theprevious quarter. Total operating expenses increased by 38% to €324.8m due to the increased levelof activity and increased costs, primarily fuel, aircraft rentals, routecharges, and airport and handling costs associated with the growth of theairline. Total operating costs were also adversely impacted by an 8% increase inthe average sector length to 570 miles whilst higher US$ fuel prices were partlyoffset by the strength of the Euro exchange rate against the US$. Staff costs increased by 24% to €42.2m, primarily due to a 12% increase inaverage employee numbers to 2,764, the impact of pay increases granted of 3%during the quarter, and the increase in the proportion of pilots recruited whoearn a higher than average salary. Pilots accounted for 42% of the increase inemployment during the quarter. Depreciation and amortisation increased by 14% to €27.0m. Depreciation chargesincreased due to the increase in the size of the 'owned' fleet from 56 to 74,offset by lower amortisation charges due to the retirement of 737-200 and thepositive impact of a new engine maintenance agreement on the cost ofamortisation of 737-800 aircraft. The strengthening of the Euro to US$ also hada positive impact on the depreciation and amortisation charge relating to newaircraft deliveries. Fuel costs rose by 112% to €109.9m due to an increase in the number of sectorsflown, an 8% increase in the average sector length, and a significantly higheraverage US$ cost per gallon of fuel partially offset by the positive impact ofthe strengthening of the Euro to the US$ during the period. Maintenance costs decreased by 2% to €13.8m reflecting the improved reliabilityarising from the higher proportion of 737's operated, the lower level ofmaintenance costs incurred due to the return of six leased 737-300's and thepositive impact of the strengthening of the Euro exchange rates against Sterlingand US$. Marketing and distribution costs decreased by 26% to €5.3m due to the reductionin the level of marketing activity and related expenditure compared to theprevious year. Aircraft rental costs increased by 24% to €10.1m reflecting an additional 7aircraft on lease during the quarter offset by the savings arising from thereturn of 6 737-300's to ILFC. Route charges increased by 25% to €41.4m due to an increase in the number ofsectors flown and an increase in the average sector length to 570 miles, offsetby a reduction in enroute charges in certain EU countries. Airport and handling charges increased by 23% to €54.6m, which was slower thanthe growth in passenger volumes and reflects the impact of increased costs atcertain existing airports offset by lower costs at new airports and bases.Other expenses increased by 12% to €20.5m, which is less than the growth inancillary revenues and reflects improved margins on some existing products andcost reductions achieved on indirect costs. Operating margins have declined by 2 points to 20% due to the reasons outlinedabove whilst operating profits have increased by 23% to €79.9m during thequarter. Interest receivable has increased by €2.6m to €8.6m for the quarter due to thecombined impact of higher levels of cash and cash equivalents and increases inaverage deposit rates earned. Interest payable increased by €5.8m due to the drawdown of debt to part fund thepurchase of new aircraft. Foreign exchange gains increased during the quarter to €0.9m due to the positiveimpact of changes in the Sterling exchange rate against the Euro compared to theyear end. The Company's Balance Sheet continues to strengthen due to the growth in profitsduring the quarter. The Company generated cash from operating activities of€213.7m. Long Term Debt, net of repayments, reduced by €13.4m. Total Cashcontinued to reflect the strong trading performance of the Company during theyear and at June 30, 2005 and stood at €1,786.5m compared to €1,605.7m at March31, 2005. Shareholders' Funds at June 30, 2005 have reduced by €35.5m to €1,699.0m,compared to March 31, 2005 reflecting the increase in profitability during thequarter of €64.4m offset by a reduction of €114.6m resulting from changes in theaccounting treatment for derivative financial instruments following the adoptionof IFRS. Notes to the Financial Statements 1. Accounting Policies This quarterly financial information has been prepared on the basis of the recognition and measurement requirements of International Financial Reporting Standards ("IFRS") in issue that either are adopted by the EU and effective (or available for early adoption) at 31 March 2006 or are expected to be adopted and effective (or available for early adoption) at 31 March 2006, the Group's first annual reporting date at which it is required to use accounting standards adopted by the EU. Based on these recognition and measurement requirements, management has made assumptions about the accounting policies expected to be applied, which are as set out below, when the first annual financial statements are prepared in accordance with accounting standards adopted by the EU for the financial year ending 31 March 2006. The preliminary accounting policies are set out in the document titled "Explanation of the financial impact following adoption of IFRS" published today. 2. Summary Reconciliation from IFRS to Irish/UK GAAP for the Quarter ended 30 June, 2005 Quarter Ended Quarter Ended 30 Jun 05 30 Jun 04 •'000 •'000 Net Income (after tax) under IFRS 69,641 53,076 EPS - IFRS 9.16c 6.99c Diluted Earnings Per Share - IFRS 9.12c 6.96c Retirement Benefits 199 65 Business Combinations (423) (586) Share Based Payments 293 - Net Income (after tax) Irish/UK GAAP 69,710 52,555 Earnings per Share - Irish/UK GAAP 9.16c 6.92c Diluted Earning per Share - Irish/ UK GAAP 9.12c 6.90c % Variance from accounting changes 0.01% -1% Quarter Ended Full Year Ended 30 Jun 05 30 Mar 05 •'000 •'000 Shareholders equity under IFRS 1,699,020 1,734,503 Retirement Benefits 9,499 9,300 Business Combinations (16,815) (16,392) Derivative Financial Instruments 114,605 - Shareholders equity under Irish/UK GAAP 1,806,309 1,727,411 % Variance from accounting changes 6.3% 0.4% 3. Approval of the Preliminary Announcement The Audit Committee approved the consolidated financial statements for the Quarter ended June 30, 2005 on July 31, 2005. 4. Generally Accepted Accounting Policies The Management Discussion and Analysis of Results for the Quarter ended June 30, 2005 and the comparative Quarter are based on the results reported under IFRS accounting policies, as adjusted for exceptional income. 5. Ancillary Products and Services In order to more accurately reflect the structure of certain ancillary contracts and to provide more meaningful information to users the Group has taken the opportunity to reclassify certain ancillary revenues and costs (primarily car hire and travel insurance). This has resulted in a reduction in revenues of €8.2 million with a corresponding reduction in costs in the quarter ended 30 June 2005 (30 June 2004: €3.2 million). This has resulted in an increase in net margin of 0.4% to 15.9% in the quarter ended 30 June 2005 (30 June 2004 0.2% to 17.7%). Going forward the Group intends to report ancillary revenues and costs on a basis consistent with the treatment described herein." This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
RYA.L