Ryanair Holdings shares surged more than 6 per cent on Monday after the airline pledged to begin returning cash to investors.
Profits at Ryanair rose 59 per cent to €2.18 billion in the six months ended September 30th, the first half of the airline’s financial year.
Michael O’Leary, chief executive, said the board planned to return €400 million to shareholders in two dividends in February and September 2024.
Ryanair’s shares surged 6.25 per cent to €16.15 by 10am in Dublin following the news, making it one of the best performing stocks in Europe on Monday.
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The Irish airline grew passenger numbers 11 per cent to 105.4 million during the six-month period, boosting revenues by 30 per cent to €6.62 billion.
Profits after tax rose 59 per cent to €2.18 billion in the six-month period from €1.37 billion during last year’s first half.
With a 3.9 per cent shareholding, Mr O’Leary is set to receive about €15.6 million from the dividends.
He noted that shareholders had invested €400 million in the airline at the peak of the Covid crisis in September 2020, making it possible for the airline to borrow €850 million through a low-interest bond.
This helped Ryanair emerge from the pandemic “in a position of unrivalled strategic and financial strength” said Mr O’Leary.
Under a new policy, Ryanair will return 25 per cent of the previous year’s profit after tax to shareholders in ordinary dividends.
It will also consider returning surplus cash through special dividends or share buybacks, debt and capital spending requirements allowing, its chief executive added.
Ryanair expects profits to reach between €1.85 billion and €2.05 billion in its current financial year, which ends on March 31st.
“This guidance remains highly dependent on the absence of any unforeseen adverse events, for example such as Ukraine or Gaza, between now and the end of March 2024,” Mr O’Leary cautioned.
