Ryanair 2010 Annual Report Download - page 90

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million in the 2009 fiscal year. This reflects an additional 10 owned aircraft (net of disposals) in the fleet at
March 31, 2009 and accelerated depreciation of 151.6 million in relation to aircraft disposals during the year and
an agreement to dispose of additional aircraft in the 2010 fiscal year. See “—Critical Accounting Policies—
Long-lived Assets” above.
Fuel and Oil. Ryanair’s fuel and oil costs per ASM increased by 39.4%, while in absolute terms, these
costs increased by 58.9% from 1791.3 million in the 2008 fiscal year to 11,257.1 million in the 2009 fiscal year,
in each case after giving effect to the Company’s fuel hedging activities. The 58.9% increase reflected a 40.7%
increase in average fuel prices paid and a 13.4% increase in the number of hours flown, the effect of which was
offset in part by a decrease of 1.1% in the average sector length and the strengthening of the euro against the
U.S. dollar during the period. Fuel and oil costs include the direct cost of fuel, the cost of delivering fuel to the
aircraft, and aircraft de-icing costs. The average fuel price paid by Ryanair (calculated by dividing total
scheduled fuel costs by the number of U.S. gallons of fuel consumed) increased 40.7% from 11.67 per U.S.
gallon in the 2008 fiscal year to 12.35 per U.S. gallon in the 2009 fiscal year, in each case after giving effect to
the Company’s fuel hedging activities.
Maintenance, Materials and Repairs. Ryanair’s maintenance, materials and repair expenses, which
consist primarily of the cost of routine maintenance and the overhaul of spare parts, increased 3.4% on a per-
ASM basis, while in absolute terms these expenses increased by 17.8% from 156.7 million in the 2008 fiscal
year, to 166.8 million in the 2009 fiscal year. The increase in absolute terms during the fiscal year reflected the
higher number of leased Boeing 737-800 aircraft, which grew to 43 from 35 during the year, and the increased
level of activity, offset in part by a lower level of maintenance costs incurred due to the improved reliability of
the Boeing 737-800s operated and the positive impact of the strengthening of the euro against the U.S. dollar
during the period.
Aircraft Rentals. Ryanair recorded 178.2 million in aircraft rental expenses during the 2009 fiscal year,
a 7.6% increase from the 172.7 million reported in the 2008 fiscal year, reflecting an increase in the weighted
average number of leased Boeing 737-800 aircraft by eight, bringing the total to 43 during the 2009 fiscal year,
the negative effect of which was somewhat offset by lower lease rates and the impact of a stronger euro versus
the U.S. dollar.
Route Charges and Airport and Handling Charges. Ryanair’s route charges per ASM decreased 3.0%
in the 2009 fiscal year, while airport and handling charges per ASM decreased 1.8%. In absolute terms, route
charges increased 10.5%, from 1259.3 million in the 2008 fiscal year to 1286.6 million in the 2009 fiscal year,
primarily as a result of the 15.2% increase in sectors flown (the effect of which was offset in part by the
decrease of 1.1% in average sector length). In absolute terms, airport and handling charges increased 11.9%,
from 1396.3 million in the 2008 fiscal year, to 1443.4 million in the 2009 fiscal year, reflecting the overall
growth in passenger volumes as well as increased costs at London (Stansted) airport, where unit costs doubled
during the 2009 fiscal year, and higher charges at Dublin Airport, both offset in part by lower average costs at
Ryanair’s newer airports and bases.
Marketing Distribution and Other Expenses. Ryanair’s marketing, distribution and other operating
expenses, including those applicable to the generation of ancillary revenues, decreased 3.0% on a per ASM basis
in the 2009 fiscal year, while in absolute terms, these costs increased 9.2%, from 1139.1 million in the 2008
fiscal year to 1151.9 million in the 2009 fiscal year, with the overall increase reflecting increased passenger
numbers, as partially offset by the achievement of cost reductions, including as a result of a focus on Internet-
based selling.
Operating Profit. As a result of the factors outlined above, operating profit decreased 84.8% on a per-
ASM basis in the 2009 fiscal year, and decreased 82.7% in absolute terms, from 1537.1 million in the 2008
fiscal year to 192.6 million in the 2009 fiscal year.
Finance Income. Ryanair’s interest and similar income decreased 10.0%, from 183.9 million in the
2008 fiscal year to 175.5 million in the 2009 fiscal year, primarily reflecting lower average interest rates
received on its deposits during the year, the impact of which was partially offset by higher average cash
balances on hand.
Finance Expense. Ryanair’s interest payable and similar charges increased 34.4%, from 197.1 million
in the 2008 fiscal year to 1130.5 million in the 2009 fiscal year, reflecting the increase in debt related to the