Ryanair 2016 Annual Report Download - page 71

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airport to boarding, as well as significantly reduce airport handling costs. Ryanair has also introduced a checked-
bag fee, which is payable on the Internet at the time of booking or post booking and is aimed at reducing the
number of bags carried by passengers in order to further reduce handling costs. See “Item 3. Risk Factors—Risks
Related to the Company—The Company Faces Risks Related to its Internet Reservations Operations and its
Announced Elimination of Airport Check-in Facilities.”
Taking Advantage of the Internet. In 2000, Ryanair converted its host reservation system to a new system, which
it operates under a hosting agreement with Navitaire that was extended in 2011 and will terminate in November 2019. As
part of the implementation of the reservation system, Navitaire developed an Internet booking facility. The Ryanair system
allows Internet users to access its host reservation system and to make and pay for confirmed reservations in real time
through the Ryanair.com website. After the launch of the Internet reservation system, Ryanair heavily promoted its website
through newspaper, radio and television advertising. As a result, Internet bookings grew rapidly, and have accounted for
the vast majority of reservations over the past several years. In May 2012, Ryanair further upgraded the reservation system
to offer more flexibility for future system enhancements and to accommodate the future growth of Ryanair. In November
2013, Ryanair re-launched its website in a new, easier to use, format that reduced the number of “clicks” to make a booking.
Various other initiatives were also introduced, including a fare finder facility which enables customers to easily find the
lowest fares. The new “My Ryanair” registration services, which allows customers to securely store their personal and
payment details, has also significantly quickened the booking process and made it easier for customers to book a flight.
The Company also launched a new mobile app in July 2014, which made it simpler and easier for customers to book
Ryanair flights. In May 2015, an upgraded mobile app, which is native to both Android and IOS, was launched. This
upgraded app is faster, more reliable and stable than previous versions of the app and enhances the experience for customers
accessing its website via mobile. The new app also offers customers the ability to add additional ancillary products on day
of travel e.g. bags, priority boarding and fast track. We launched a new version of the website in October 2015 with the
key features being personalization, a new myRyanair, easier booking flow, more content, faster, intuitive and fully
responsive for mobile devices. Ryanair, as part of the “AGB” customer experience program, will endeavor to improve its
website and mobile app through a series of ongoing upgrades.
Commitment to Safety and Quality Maintenance. Safety is the primary priority of Ryanair and its management.
This commitment begins with the hiring and training of Ryanair’s pilots, flight attendants, and maintenance personnel and
includes a policy of maintaining its aircraft in accordance with the highest European airline industry standards. Ryanair
has not had a single passenger or flight crew fatality as a result of an accident with one of its aircraft in its 31-year operating
history. Although Ryanair seeks to maintain its fleet in a cost-effective manner, management does not seek to extend
Ryanair’s low-cost operating strategy to the areas of safety, maintenance, training or quality assurance. Routine aircraft
maintenance and repair services are performed primarily by Ryanair, at Ryanair’s main bases, but are also performed at
other base airports by maintenance contractors approved under the terms of a European Aviation Safety Agency (“EASA”)
Part 145 approval. Ryanair currently performs heavy airframe maintenance, but contracts with other parties who perform
engine overhaul services and rotable repairs. These contractors also provide similar services to a number of other airlines,
including Southwest Airlines, British Airways, Air France and Alitalia.
Enhancement of Operating Results through Ancillary Services. Ryanair distributes accommodation services and
travel insurance primarily through its website. For accommodation (hotels, villas, apartments, hostels etc.) services,
Ryanair currently has a contract with Booking.com to market hotels during and after the booking process. The
accommodation business went out to tender in July 2016, and a new multi-supplier solution is under development for
quarter 3 fiscal 2017. Ryanair also offers airport transfers and car park services through its website and onboard its aircraft.
Ryanair offers car hire services via a contract with CarTrawler, which replaced previous supplier Hertz in September 2015.
Ancillary services accounted for approximately 24% of Ryanair’s total operating revenues in the 2016 fiscal year and
approximately 25% of Ryanair’s total operating revenues in the 2015 fiscal year See “—Ancillary Services” below and
“Item 5. Operating and Financial Review and Prospects—Results of Operations—Fiscal Year 2016 Compared with Fiscal
Year 2015—Ancillary Revenues” for additional information.