Ryanair 2011 Annual Report Download - page 125

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The Company also enters into interest rate swaps to hedge against floating rental payments associated
with certain aircraft financed through operating lease arrangements. Through the use of interest rate swaps,
Ryanair has effectively converted the floating-rate rental payments due under 12 of these leases into fixed-rate
payments. At March 31, 2011, the fair value of the interest rate swap agreements relating to leases on a mark-to-
market basis was equivalent to a loss of 11.4 million (gross of tax), as compared with a loss of 113.3 million at
March 31, 2010. These financial instruments are, accordingly, recorded at fair value in the balance sheet and are
subsequently re-measured to fair value through equity to the extent effective, with ineffectiveness recorded
through the income statement. The Company has recorded no material level of ineffectiveness on these swaps as
they have the same critical terms as the underlying item being hedged. Under IFRS, the Company accounts for
all of its swaps as cash-flow hedges of variable rental payments or variable rate debt payments. At March 31,
2011, the Company recorded a total negative fair-value adjustment of 11.2 million (net of tax) relating to these
arrangements, which was included within accumulated other comprehensive income, as compared with a 111.7
million negative fair-value adjustment at March 31, 2010. This loss will be realized within earnings over the
period from the expected drawdown of the related financing (i.e., over a period of up to seven years from March
31, 2011), with an increase in the related interest expense.
If Ryanair had not entered into such derivative agreements, a plus or minus one percentage point
movement in interest rates would impact the fair value of this liability by approximately 139.3 million. The
earnings and cash-flow impact of any such change in interest rates would have been approximately plus or
minus 116.1 million in the 2011 fiscal year.
Item 12. Description of Securities Other than Equity Securities
Holders of ADSs are required to pay certain fees and expenses. The table below sets forth the fees and
expenses which, under the deposit agreement between the Company and The Bank of New York Mellon,
holders of ADRs can be charged or be deducted from dividends or other distributions on the deposited shares.
The Company and The Bank of New York Mellon have also entered into a separate letter agreement, which the
Company believes should have the effect of reducing some of the fees listed below. However, the Company and
The Bank of New York Mellon have not yet reached final agreement on the exact application of such separate
letter agreement to certain of the fees listed below, so it is possible that such fees may be assessed by The Bank
of New York Mellon without any such reduction.
Persons
depositing or withdrawing
ADSs
must pay: For:
$5.00 (or less) per 100 ADSs (or portion of
100 ADSs).
Issuance of ADSs, including issuances resulting from a
distribution of common shares or rights or other property.
Cancellation of ADSs for the purpose of withdrawal, including if
the deposit agreement terminates.
$0.02 (or less) per ADS.
Any cash distribution to the holder of the ADSs.
$0.02 (or less) per ADS per calendar year.
Depositary services.
A fee equivalent to the fee that would be
payable if securities distributed to the
holder of ADSs had been shares and the
shares had been deposited for issuance of
ADSs.
Distribution of securities distributed by the issuer to the holders
of common securities, which are distributed by the depositary to
ADS holders.
Registration or transfer fees.
Transfer and registration of shares on our share register to or from
the name of the depositary or its agent when the holder of ADSs
deposits or withdraws common shares.
Expenses of the depositary. Cable, telex and facsimile transmissions (when expressly
provided for in the deposit agreement).
Expenses of the depositary in converting foreign currency to U.S.
Dollars.