Skip navigation
Watchlist Sponsored By :

Current DateTime: 02:45:39 11 Nov 2009
LinksList Documentid: 24355697

FEATURED QUIZZES


Current DateTime: 02:45:39 11 Nov 2009
LinksList Documentid: 33793611

Current DateTime: 02:45:39 11 Nov 2009
LinksList Documentid: 24890560
  • Winterizing Your Portfolio

      If 2009 was the winter of our discontent, will 2010 be a winter wonderland for investors? A lot depends on the recovery—or lack thereof.

  • Investor's Guide to Real Estate

      Some even say the long-awaited recovery is here. Regardless, buyers and sellers alike can profit from our guide.

  • Alternative Investing

      Stocks and bonds? Sure. But it's a big world out there for investors.

powered by digg
Ryanair CEO Says Downturn Good for the Company
By: Izabella Kaminska, Special to CNBC | 16 May 2008 | 12:10 PM ET
Text Size

Low-cost carrier Ryanair is likely to benefit in the event of a major slowdown hitting Europe, according to the airline’s chief executive Michael O’Leary.

AP
Ryanair CEO Michael O'Leary

Speaking to CNBC, O’Leary said passengers would naturally turn to Ryanair and away from more expensive rivals as they tried to save money.

“I think we'll come out of this downturn significantly stronger, probably as Europe's largest airline,” he said. “If anything, we'll probably speed up the rate of growth during the downturn.”

Like most of its competitors, Ryanair is grappling with higher oil prices, which are biting into profit margins.

Shares in the Dublin-listed stock are down nearly 48 percent in the year, knocking the company’s market cap to some 6 billion euros.

Investors fear the airline is not sufficiently protected from further oil price shocks.

But some analysts say the carrier could benefit if prices do fall back below $100 per barrel, an event likely to be costly for those airlines that have put out expensive hedges at current levels.

O’Leary stressed the current market environment was not about improving profit margins but gaining market share.

“We'll lower the fares even more significantly during the downturn,” he said. “It does mean that profit margins are going to fall, it means profits will probably fall, certainly for the next 12 months. Frankly, shareholders are just going to have to take it on faith.”

Analysts agree Ryanair is well positioned to grow, especially as it still has unexecuted orders and options to buy dozens of Boeing planes over the next four years at prices well below current going rates.

The outspoken CEO added he’s also ready to invest more of his reported $3.2 billion cash pile back into the company too.

“We're investing in the future here, we're investing in building a much bigger Tesco of the skies here in Europe, and I think most [shareholders] will support what we're doing,” he said.

© 2009 CNBC.com
Tools:
Print EmailAdd This share icon
  • digg share

CNBC HIGHLIGHTS

  • Vote and suggest your own, and remember--there's a fine line between a hero and a zero.
  • If you are lucky enough to have money and the time, this is a great time to see America, says CNBC's Jane Wells.
  • What’s powering your microwave, fridge and computer? Part of it is fuel from Russian nuclear weapons. The NYT reports.
  • Mickey Mouse
  • One author sees lessons for you in Disney’s recent Makeover of Mickey Mouse: “Nice” doesn’t always win.
  • With 123 years of history, slogans and commercials, Coca-Cola is the most recognized brand on earth.
  • The opening of a virtual pet store in “World of Warcraft” could prove a cash bonanza for Activision-Blizzard.
ADD COMMENTS
Remaining characters


Current DateTime: 01:40:19 11 Nov 2009
LinksList Documentid: 29778428

Current DateTime: 01:02:04 11 Nov 2009
LinksList Documentid: 29779196

Current DateTime: 02:13:25 11 Nov 2009
LinksList Documentid: 29779199

Current DateTime: 01:02:04 11 Nov 2009
LinksList Documentid: 29779198
  Data is a real-time snapshot  *Data is delayed at least 15 minutes
Global Business and Financial News, Stock Quotes, and Market Data and Analysis

© 2009 CNBC, Inc.  All Rights Reserved.
A Division of NBC Universal
Thomson ReutersThomson Reuters