Morning business news - July 28Monday 28 July 2014 08.57
Ryanair says it's going to pay out a special dividend of €520 million, or 37.5 cent per share, in the fourth quarter, pending shareholder approval.
The airline says it's on course for higher full year profits than previously guided.
It reported first quarter results this morning.
Howard Millar, Ryanair's Deputy CEO and chief financial officer said it was a very strong set of results with average fares up 9%.
"About half of that is due to a very strong Easter, half due to strong underlying performance. Profits were up 152% to €197 million."
He said he expected the underlying trend on average fares to continue into the second quarter, ending in September, but that fares were expected to fall by 6-8% in winter as capacity is increased on key business routes.
"Full year profits are expected to grow by 20% to a range of between €620 to €650 million," he explained.
Howard Millar said Ryanair's new customer friendly approach had contributed to the quarter's good performance, as well as improvements to the website and the launch of allocated seating and the new mobile app.
"We expect business travel to be up and running in September. We are realigning schedules to make them more business friendly. There won't be a cordoned off area on airliners for business travellers. They will have access to seats at front or centre exit seats," he explained.
Mr Millar said Ryanair hoped to start services to Russia in the winter or early spring, but long-haul flights to the US was not something that was on the agenda for now.
On the European Commission ruling that Ryanair must pay back state aid it received from the French government on three routes, Howard Millar said they were appealing the decision.
"We had 24 investigations of which there have been rulings on ten. We won seven, we lost three. We're appealing those and we expect to be successful and to win the others" he concluded.
Ryanair is also appealing the ruling by the British Competition Commission that it must reduce its 30% shareholding in Aer Lingus to 5%.
"It has another year to run. We're also appealing the EC decision on the take-over of Aer Lingus. This process will go on for some time but we don't expect a final outcome for another 18 to 24 months."
The Dublin Chamber of Commerce is calling on the Government to give business owners early access to a portion of their pension funds for the specific purpose of business growth.
It calculates that up to €7.5bn worth of SME financing could be unlocked if this idea was implemented.
It forms part of the Chamber's Budget submission which they are publishing today.
The Chamber says the Government now needs to focus on non-banking financing solutions for SMEs.
Staying with the enterprise theme and anyone hoping to set up a business might consider going the co-op route.
Legislation comes into effect today easing the regulatory burden on co-operative societies and making it easier to set up and run one.
Minister for Enterprise Richard Bruton introduced reduced fees for the registration of co-operative societies about a year and a half ago.
Among the changes will be an extension of the examinership process to co-ops.
Deutsche Bank, HSBC and Bank of Nova Scotia have been accused of attempting to rig the price of silver.
A lawsuit has been filed in the US alleging that the banks, which set the price of silver each day, abused their position in the market.
The lawsuit follows similar accusations in the gold price-fixing market.
Earlier this year, Barclays was fined £26m after one of its traders was caught trying to fix the price of gold.
Argentina looks increasingly likely to default on its debt for the second time in 12 years this Wednesday.
The Argentine Economic Minister failed to show up in New York for talks with creditors on Friday.
Most bondholders accepted a deal to get back a small percentage in exchange for writing off some debt.
But some bonds are owned by US hedge funds who want full repayment.
Argentina can't pay out until all bondholders have agreed and the court deadline is Wednesday.
The Central Bank has announced that it's to allow hedge funds based here to lend to companies under new rules being drawn up.
Firms that are not getting access to bank funding, or that are too small to issue bonds, are seeking to borrow from other sources such as insurers, private equity firms and hedge funds.
The Central Bank has issued a consultation paper on its proposed rules today and expects them to be in place by the end of the year.