Ryanair 2011 Annual Report Download - page 162

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160
Interest rate re-pricing
Floating interest rates on financial liabilities are generally referenced to European inter-bank interest
rates (EURIBOR). Secured long-term debt and interest rate swaps typically re-price on a quarterly basis with
finance leases re-pricing on a semi-annual basis. We use current interest rate settings on existing debt at each
year-end to calculate contractual cash flows.
Fixed interest rates on financial liabilities are fixed for the duration of the underlying structures
(typically between 10 and 12 years).
The Company holds significant cash balances that are invested on a short-term basis. At March 31,
2011, all of the Company’s cash and liquid resources had a maturity of one year or less and attracted a weighted
average interest rate of 0.97% (2010: 0.93%; 2009: 1.84%)
March 31, 2011 March 31, 2010 March 31, 2009
Financial assets
Within
1 year Total
Within
1 year Total
Within
1 year Total
1M 1M 1M 1M 1M 1M
Cash and cash equivalents
................................
2,028.3 2,028.3 1,477.9 1,477.9 1,583.2 1,583.2
Cash > 3 months
................................
869.4 869.4 1,267.7 1,267.7 403.4 403.4
Restricted cash
................................
42.9 42.9 67.8 67.8 291.6 291.6
Total financial assets
................................
2,940.6 2,940.6 2,813.4 2,813.4 2,278.2 2,278.2
Interest rates on cash and liquid resources are generally based on the appropriate EURIBOR, LIBOR or
bank rates dependant on the principal amounts on deposit.
As described in Note 4 to the consolidated financial statements, the Company also held 1114.0 million
of an equity investment in Aer Lingus at March 31, 2011 (2010: 1116.2 million; 2009: 193.2 million). This has
no fixed maturity and is not interest bearing.
(d) Foreign currency risk
The Company has exposure to various foreign currencies (principally U.K. pounds sterling and U.S.
dollars) due to the international nature of its operations. The Company manages this risk by matching U.K.
pound sterling revenues against U.K. pound sterling costs. Any remaining unmatched U.K. pound sterling
revenues are used to fund U.S. dollar currency exposures that arise in relation to fuel, maintenance, aviation
insurance and capital expenditure costs or are sold for euro. The Company also sells euro forward to cover
certain U.S. dollar costs. Further details of the hedging activity carried out by the Company are disclosed in
Note 5 to the consolidated financial statements.