march 2015 debt investor update€¦ · book value of fleet €5.3bn market value of fleet €7.1bn...
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© Ryanair 2014
Debt Investor Update
March 2015
© Ryanair 2014
Europe ’s Onl y U l t ra Low Cost Car r ier
Proven, resilient business model
Europe’s lowest fares/lowest unit costs
Europe’s No 1, Traffic – 90m (No.1 or 2 market leader)
Europe’s No 1, Coverage – 72 Bases, 189 Airports, 30 Countries
Europe’s No 1, C’mer Service – Lowest Fares/On-time/Bags/Cancellations
– “Always Getting Better” / Digital Rollout
Forward bookings, load factors & traffic rising
380 new aircraft order = growth to 160m pa by FY24
Industry leading cash generation & liquidity
Unblemished 30 year safety record
World’s highest rated airline, BBB+ (stable), S&P & Fitch
2
© Ryanair 2014
Res i l ient Model – P ro f i t Growth T hrough Cycle
3
(Forecast)
(Forecast)
6 8 11 16 23
28 35
45 51
59 67
72 76 79 82 90
-
10
20
30
40
50
60
70
80
90
100
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Customers (m)
9/11
SARS
Madrid Bombings
London Bombings
Financial Crisis &
Oil Spike
Ash Cloud
EU Recession
130 180 226 340 381
473 547
673 786
427
733 863
1,083 1,146 1,112
35.2% 37.0% 36.2% 40.4% 35.4% 35.8% 32.3% 30.1% 29.0%
14.5%
34.5%
23.8% 24.7% 23.5% 22.0%
-150.0%
-130.0%
-110.0%
-90.0%
-70.0%
-50.0%
-30.0%
-10.0%
10.0%
30.0%
0
200
400
600
800
1000
1200
1400
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
EBITDAR (€m) FY 31 March
EBITDAR Margin FY 31 March
© Ryanair 2014
RYA EZY NOR
Staff
Airport & hand
Route charges
Own’ship & maint.
Sales, marketing, & other
Total
% > Ryanair
€6
€8
€6
€7
€2
€29
€9
€21
€6
€8
€7
€52
+ 76%
€15
€14
€8
€21
€4
€62
+114%
€35
€8
€0
€16
€15
€74
+155%
LUV Spirit
€19
€6
€0
€19
€15
€59
+103%
€17
€27
€8
€29
€26
€107
+270%
AB1
Europe ’s Lowest Cost (Ex Fuel )
Source: Latest Annual Reports 4
© Ryanair 2014
Europe ’s Lowest Fares
Avg. Fare
€46
€83
€84
€93
€121
€235
€242
€300
5
Avg. Competitor Fare €163
+80%
+83%
+102%
+163%
+411%
+426%
+552%
Source: Latest Annual Reports
© Ryanair 2014
72 bases (Yellow boxes)
189 airports
30 countries
1,600+ routes
100m c’mers
306 x B737-800’s
374 x Boeings on order
Europe ’s No 1 Coverage
6
© Ryanair 2014
.
FY15 FY16 FY17
FY14
FY20 FY18 FY19 FY21 FY22 FY23 FY24
57 62
81.7
62
63
160
90
7
Europe ’s No 1 For Traf f ic Growth
Source: Latest traffic stats for 12 months to Mar’14 and company forecasts
Customers (m)
© Ryanair 2014
Europe ’s No 1 A i r l ine
UK (117)
Germany (112)
Spain (105)
Italy (85)
France (72)
Portugal (19)
Belgium (15)
Ireland (15)
Poland (15)
Morocco (12)
16%
4%
18%
25%
7%
17%
25%
46%
26%
12%
Share Country (Capacity m)* No. 1 No. 2
BA
Iberia
EasyJet
EasyJet
Jetairfly
BA
Wizz
EasyJet
No. 3
Air Berlin
Vueling
Alitalia
EasyJet
SN Brussels
Aer Lingus
LOT
Easyjet
Lufthansa
AF- KLM
TAP
RAM
8
* Source: Cap Stats Departing Seats 2014
© Ryanair 2014
90m
100m
106m
114m
120m
128m
136m
143m
150m
160m
FY’15
FY’16
FY’17
FY’18
FY’19
FY’20
FY’21
FY’22
FY’23
FY’24
C’mers P.A.
73
7-8
00
Ord
er
MA
X O
rde
r Fleet
(at YE)
308
340
368
402
420
451
468
489
509
520
Growth Ann Cum
+ 10%
+ 11%
+ 6%
+ 8%
+ 5%
+ 7%
+ 6%
+ 5%
+ 5%
+ 7%
+ 10%
+ 22%
+ 30%
+ 40%
+ 47%
+ 57%
+ 66%
+ 75%
+ 84%
+ 96%
Moderate F leet / Tra f f ic Growth FY15 to FY24
9
© Ryanair 2014
“Always Getting Better” programme
Business Plus & Family Extra Service
90m customers (up 10%)*
87% Load factor (up 5% points)*
530,000+ flights, over 90% on-time
First 9 of 380 new B737 aircraft delivered
8 new bases: Athens, Brussels, Cologne, Gdansk, Glasgow, Lisbon, Salonika & Warsaw
19 new airports incl. Copenhagen, Hamburg, Santorini & Stuttgart
FY’15 profit after tax guidance raised to €840m - €850m range*
2014 /15 – A Recor d Year for Ryanai r
10
* Guidance to FY 31 March 2015 (2nd February 2015)
© Ryanair 2014
Forwar d Bookings Dr iv ing Load Factor s
11
Load Factors
FY’14 FY’15
Apr 81% 84% +3%
May 82% 85% +3%
Jun 84% 88% +4%
Jul 88% 91% +3%
Aug 89% 93% +4%
Sep 85% 90% +5%
Oct 83% 89% +6%
Nov 81% 88% +7%
Dec 81% 88% +7%
Jan 71% 83% +12%
© Ryanair 2014
Q3 Resul ts
Dec '13
Dec '14
Traffic 18.3m 20.8m +14%
Load Factor 82% 88% +6% points
Avg. Fare (incl. bag) €39 €40 +2%
Rev. Per Pax €53 €54 +3%
Revenue €964m €1,132m +17%
Net Profit / (loss) (€35m) €49m +€84m
Net Margin (4%) +4% +8% points
12
© Ryanair 2014
Q3 Balance Sheet
(i) Includes €850m euro bond proceeds (June 2014)
Mar '14 Dec '14
€m €m Aircraft (inc. dep) 5,570 6,385
Cash 3,242 4,121 (i)
Total Net Cash 8,812 10,506 Net Cash
€158m €447m
Liabilities 2,442 2,783
Debt 3,084 3,674 (i)
S/H Funds 3,286 4,049
Total 8,812 10,506
13
© Ryanair 2014
Indust r y Leading Cash Generat ion & L iqu id i ty
€447m net cash at 31 December 2014
Will maintain net cash at YE 15 post: - €520m dividend
- Start of €400m buyback programme
- CAPEX
- Secured debt repayments
Consistently Strong EBITDAR Margins Results in Industry Leading Liquidity
2,898
3,481 3,534 3,242
80.0% 79.0% 72.0% 64.0%
-150.0%
-100.0%
-50.0%
0.0%
50.0%
-400
100
600
1100
1600
2100
2600
3100
3600
2011 2012 2013 2014 2015
Cash Cash / Revenues
14
863
1,083 1,146 1,112
23.8% 24.7% 23.5% 22.0%
-150.0%
-130.0%
-110.0%
-90.0%
-70.0%
-50.0%
-30.0%
-10.0%
10.0%
30.0%
0
200
400
600
800
1000
1200
1400
2011 2012 2013 2014 2015
EBITDAR (€m) EBITDAR Margin
© Ryanair 2014
Conser vat ive F inancia l Po l ic ies
Significant cash balances (circa €4bn)
- No liquidity lines required
- Ample unsecured hedging lines
- Cash in term or structured deposits
- Placed with highly rated institutions
Strong positive working capital
- Very low cost base
- Customers pay in advance
- Pre delivery payments paid with cash
- Potential to buy aircraft with cash
Hedging Shareholder Returns
€520m dividend in Feb ‘15
€400m share buyback programme
Further returns subject to Shareholder approval &:
- Continuing profitability
- Economic environment
- CAPEX
- Fuel prices
- Fares
OPEX, 70%-90%, 12-30 months forward
CAPEX, 70%-100%, 12 months to FY’18
Match GBP costs & revenues
Interest rate exposure >70% fixed
Floating interest exposure matched with
cash deposits
Liquidity Management Capital Management
15
© Ryanair 2014
Year Jet Fuel Currency
% cover $/MT % cover €/$
FY’14 - $980 - $1.31
FY’15 90% $950 90% $1.34
FY’16 90% $920 90% $1.33
FY’17 35% $680 60% $1.21
Fue l Hedging
RYR expects some/all fuel saving to be passed on in lower fares
(“Load factor active / yield passive”)
Source: Q3 results statement on 2nd February 2015 16
© Ryanair 2014
Amortisation of Existing Debt Balances (€m)*
Debt Repayment Schedule (€m)*
Ex is t ing Debt Matur i ty Schedule
17 * Assuming a €/S Rate of $1.10
© Ryanair 2014
Total Assets (Book Value) Total Assets (Fair Value) Secured Debt
€4.1bn Cash
€4.1bn Cash €1.1bn Other Assets
€1.1bn Other Assets
Book Value of Fleet €5.3bn
Market Value of Fleet €7.1bn
Secured Debt €2.8bn
€10.5bn
€2.8bn
€12.3bn
F leet Va luat ion & Secured Debt Coverage*
Total Assets (Book Value) / Secured Debt = 3.8 x Coverage
Total Assets (Fair Value) / Secured Debt = 4.4 x Coverage
18 * As of 31st December 2014
© Ryanair 2014
Wor ld ’s H ighest Rated A i r l ine
BBB+ corporate rating from S&P & Fitch
– World's highest rated airline
– Stable outlooks
– “A-” anchor (S&P), notched due to possible CAPEX & shareholder returns
– Industry leading liquidity, cost base & cash generation
– BBB+ note rating expected
Low cost source of Euro unsecured debt
Supplements existing financing options, Ex-Im available as low cost backstop
19
© Ryanair 2014
Out look*
Q4’15 traffic up 25% (FY’15 90m +10%, FY’16 100m +11%)
Q4’15 fares down: -6% to -8% (Jan pricing softer)
Unit cost down -5%, (ex fuel flat)
Oil price falling, 90% hedged FY’16, 35% FY’17
FY’15 profit after tax guidance raised to €840m - €850m
€520m dividend (€0.375ps) Feb, €400m share buyback (Feb – Aug)
Strong net cash position at year end
“Always Getting Better” delivers for customers and investors
20
*Source: Q3 results statement on 2nd February 2015
© Ryanair 2014
Certain of the information included in this presentation is forward looking and is subject to important risks and uncertainties that could cause actual results and developments to differ materially from those expressed in or implied by such forward-looking statements. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend upon future circumstances that may or may not occur. A number of factors could cause actual results and developments to differ materially from those express or implied by the forward-looking statements including those identified in this presentation and other factors discussed in our Annual Report on Form 20-F filed with the SEC. 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 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 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 UK and Continental Europe, the general willingness of passengers to travel and other economics, social and political factors and flight interruptions caused by volcanic ash emissions or other atmospheric disruptions. These and other factors could adversely affect the outcome and financial effects of events or developments referred to in this presentation on the Ryanair Group. Forward looking statements contained in this presentation based on trends or activities should not be taken as a representation that such trends or activities will continue in the future. Except as may be required by the Market Abuse Rules of the Central Bank of Ireland, Listing Rules of the Irish Stock Exchange or by any other rules of any applicable regulatory body or by law, the Company disclaims any obligation or undertaking to release publicly any updates or revisions to any forward statements contained herein to reflect any changes in the Company’s expectations with regard to any change in events, conditions or circumstances on which any such statement is based. This presentation contains certain forward-looking statements as defined under US legislation. By their nature, such statements involve uncertainty; as a consequence, actual results and developments may differ from those expressed in or implied by such statements depending on a variety of factors including the specific factors identified in this presentation and other factors discussed in our Annual Report on Form 20-F filed with the SEC
Discla imer
21
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