RYANAIR H1 PROFITS UP 20% - Ryanair reported half- year figures this morning which showed that profits came in at €544m - a 20% jump on the results for the same time last year. Aer Lingus, meanwhile, announced its latest traffic statistics this morning showing passenger numbers up 1.6% in October.
Ryanair is Aer Lingus' largest single shareholder. Last week - after its own results - Aer Lingus said it hoped to see the issue of the €500m hole in its pension fund resolved by the beginning of next year. That would remove a big stumbling block standing in the way of the state fulfilling its desire to sell its stake.
Ryanair's chief financial officer Howard Millar says removing the pension issue could add more than 40 cent per share, or €110m, to the company's value. He said Ryanair would be keen that the stake is sold to another airline rather than a private equity firm but that it was difficult to see where a bid might come from.
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LAST MONTH'S BORD GÁIS ENERGY INDEX 21% HIGHER THAN SAME TIME LAST YEAR - The October edition of Bord Gáis energy index - which tracks the commodity prices and input costs into fuel and energy - is 21% higher than it was last year. Michael Kelleher, Bord Gáis' energy analyst, says that last month's index rose by 1%. The oil element of the index rose by 3%, but this was offset by falls in the coal and electricity elements, while the restrengthening of the euro against the dollar also affected the index.
Mr Kelleher says that currency movements affect commodity markets as oil and coal are traded in dollars and gas in sterling. If the euro strengthens against these currencies, fuel prices get more expensive for those using the euro to pay for them. He also says that oil can be pushed around by sentiment on world equity markets. Oil prices started the month at $99 a barrel, then moved up to trade at $115 by the middle of the month after a rescue package for Greece was agreed by the euro zone and then it slipped back to $109 again as concerns about the euro zone economy surfaced again. The economies of Asian countries, especially China, are still booming and that is still supporting demand for energy, Mr Kelleher said.
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MORNING BRIEFS - Michael Noonan joins his euro zone counterparts in Brussels today as the 17 finance ministers put their heads together on how best to add heft to the EU's bail-out fund the European Financial Stability Facility (EFSF). The latest proposals on the table are to increase its size from €440 billion to more than €1 trillion. Italy is the big concern here. It has €1.9 trillion of debt outstanding and a requirement to borrow €300 billion over the next year. So if the markets lose faith in Italy's ability to pay its own way and the country is forced to apply for assistance the EU faces the real worry that the EFSF won't be big enough and also the difficulty that Italy is one of the guarantors of the EFSF and so if it applies it can no longer participate. The finance ministers will today begin thrashing out the technical details of how the EFSF can borrow more money to increase the size of the pot and how to manage the risks that come with that. This is a process that was originally scheduled to be complete by the end of the year. But the events of the last week have lit a fire under the finance ministers
*** In currency news, the euro buys $1.3725 and 86.7 pence sterling.
