Ryanair has raised its profit guidance for the fifth time this year on the back of a strong performance in its third financial quarter. It is now looking at profit in the range of €840-850m. The airline recorded a profit of €49m in the three months to the end of December - up substantially on the loss of €35m in the same period the previous year. Revenue for the period was 17% higher at €1.13 billion.
Michael O'Leary, Ryanair's chief executive, said that none of the airline's positive performance in the third quarter was down to falling oil prices. "We're fully hedged against oil. All of the growth in the quarter was down to our new winter schedules and our 'Always Getting Better' programme," he stated. The airline is embarking on a €400m share buyback programme later this month and it is also paying out a special dividend at the end of the month.
On the IAG proposal to buy Aer Lingus, Michael O'Leary said he had no opinion on it as it would remain in the realms of speculation until a formal offer is tabled. On the question of cast iron guarantees around Heathrow landing slots, Michael O'Leary said the importance of the airport was overblown. "It generates far more noise than is warranted. More people fly to other London airports than to Heathrow every day from Ireland. The noise about connectivity and Heathrow slots are misplaced in a modern aviation world," he said.
Mr O'Leary said he believed that, regardless of the outcome of the appeal to the UK competition commission ruling on Ryanair's holding in Aer Lingus, it would be appealed again, either by Ryanair or Aer Lingus. "We've made three offers for Aer Lingus in the past. We believe it was the right long term home for the airline. It's now been established that it cannot survive as an independent airline," he added.
MORNING BRIEFS - Builders materials group CRH has been providing details this morning of what is believed to be one of the largest ever acquisitions by an Irish company. It has entered into a €6.5 billion transaction early yesterday that will see it take ownership of a large tranche of assets from European rivals Lafarge and Holcim. They were instructed to offload the businesses to win regulatory approval for a €35 billion merger. CRH is planning an equity placing equivalent to almost 10% of its shares to help fund the acquisition along with cash and new debt.
*** Mean Irish GDP is expected to reach its 2007 pre-recession peak this year, according to Davy - which publishes its latest economic outlook today. That is a year sooner than it had previously anticipated. The stockbroking firm has upgraded its 2014 GDP estimate to 4.8% - up from 3.5% in its last forecasts in August last. It is now looking at 3.7% growth in 2015 with exports continuing to be the main driver on the back of a weak euro.
*** The country's manufacturing sector expanded for the 20th month is a row in January. According to the Investec Purchasing managers Index, both output and new orders increased and client demand continued to improve. Falling oil prices led to a reduction in input costs, with firms passing these declines on to customers by way of lower output prices.
*** A tax on profits earned by US companies overseas has been proposed by US President Barack Obama in his $4 trillion budget for 2016. The move could have big implications for companies here, like Google and Apple. Under the plans, Mr Obama wants to introduce a minimum 19% tax on future overseas earnings of American companies and a 14% tax on profits accumulated by the firms outside the US in low-tax countries.