Ryanair 2011 Annual Report Download - page 86

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Finance expense. Ryanair’s interest and similar charges increased 30.2%, from 172.1 million in the
2010 fiscal year to 193.9 million in the 2011 fiscal year, primarily due to the drawdown of debt related to the
acquisition of additional Boeing 737-800 aircraft. These costs are expected to increase as Ryanair further
expands its fleet.
Foreign exchange (losses) gains. Ryanair recorded foreign exchange losses of 10.6 million in the 2011
fiscal year, as compared with foreign exchange losses of 11.0 million in the 2010 fiscal year, with the different
result being primarily due to the strengthening of the U.K. pound sterling and U.S. dollar exchange rates against
the euro during the 2011 fiscal year.
Taxation. The effective tax rate for the 2011 fiscal year was 11.0%, as compared to an effective tax rate
of 10.5% in the 2010 fiscal year. The effective tax rate reflects the statutory rate of Irish corporation tax of
12.5%. Ryanair recorded an income tax provision of 146.3 million in the 2011 fiscal year, compared with a tax
provision of 135.7 million in the 2010 fiscal year, with the increase primarily reflecting higher pre-tax profits.
The determination regarding the recoverability of the deferred tax asset was based on future income forecasts,
which demonstrated that it was more likely than not that future profits would be available in order to utilize the
deferred tax asset. A deferred tax asset’s recoverability is not dependent on material improvements over
historical levels of pre-tax income, material changes in the present relationship between income reported for
financial and tax purposes, or material asset sales or other non-routine transactions.
FISCAL YEAR 2010 COMPARED WITH FISCAL YEAR 2009
Profit/(loss) after taxation. Ryanair recorded a profit on ordinary activities after taxation of 1305.3
million in the 2010 fiscal year, as compared with a loss of 1169.2 million in the 2009 fiscal year. This profit was
primarily attributable to a 28.9% decrease in fuel and oil costs from 11,257.1 million to 1893.9 million, partially
offset by a decrease in revenues driven by a 12.7% decline in average fares.
Scheduled revenues. Ryanair’s scheduled passenger revenues decreased 0.8%, from 12,343.9 million in
the 2009 fiscal year, to 12,324.5 million in the 2010 fiscal year, primarily reflecting a decrease of 12.7% in
average fares. The number of passengers booked increased 13.6%, from 58.6 million to 66.5 million, reflecting
increased scheduled passenger volumes on existing passenger routes and the successful launch of new bases at
Trapani, Pescara, Oporto, Bari, Brindisi, Leeds Bradford, Faro and Oslo (Rygge) in the 2010 fiscal year. There
was a one-percentage-point increase in booked passenger load factors from 81% in the 2009 fiscal year to 82%
in the 2010 fiscal year.
Passenger capacity (as measured in ASMs) during the 2010 fiscal year increased by 13.5% due to the
addition of 51 Boeing 737-800 aircraft (net of disposals), as well as a 12.3% increase in sectors flown and a
1.0% increase in the average length of passenger haul. Scheduled passenger revenues accounted for 77.8% of
Ryanair’s total revenues for the 2010 fiscal year, compared with 79.7% of total revenues in the 2009 fiscal year.
Ancillary revenues. Ryanair’s ancillary revenues, which comprise revenues from non-flight scheduled
operations, in-flight sales and Internet-related services (including insurance, accommodation and car rental),
increased 11.0%, from 1598.1 million in the 2009 fiscal year to 1663.6 million in the 2010 fiscal year, while
ancillary revenues per booked passenger decreased to 19.98 from 110.22. Revenues from non-flight scheduled
operations, including revenues from excess baggage charges, debit and credit card transactions, sales of rail and
bus tickets, accommodations, travel insurance and car rental, increased 7.7% to 1493.5 million from 1458.0
million in the 2009 fiscal year from in-flight sales increased 4.0%, to 186.5 million from 183.2 million in the
2009 fiscal year. Revenues from Internet-related services, primarily commissions received from products sold
on Ryanair.com or linked websites, increased 46.9%, from 156.9 million in the 2009 fiscal year to 183.6 million
in the 2010 fiscal year. The rate of increase in revenues from Internet-related operations exceeded the increase
in overall passengers booked, while the rate of increase in the other categories grew at a slower rate than
passenger bookings.