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Ryanair may return to bond market

Dublin - Ryanair could return to the bond market in the next 12 tp 18 months after its debut bond in June was well received, the airline's chief financial officer told Reuters on Wednesday.

"This is a market that we will come back to at some stage over the next 12 to 18 months," Neil Sorahan said in an interview.

After gaining an investment grade credit rating, Ryanair borrowed €850m in its first bond issue in June. Sorahan said the airline had offers on that day totalling €6.4bn.

"There's still a lot of people out there who wanted to get access to Ryanair debt and who didn't," he said.

He said Ryanair was well covered with its capex needs for the current year to the end of March, and was looking at various financing options for the roughly €1bn in capex planned for the next financial year.

Ryanair is reaping the benefits of a strategy shift to be nicer to customers, cutting some of its charges, providing free allocated seating and allowing passengers to take two bags into the cabin.

Sorahan said ancillary revenues, which grew 17% to €1.25bn in the last financial year, would therefore be flat per passenger this year as Ryanair loses out on some of that revenue, but that additional costs incurred such as for marketing were being offset by winning more passengers to fill its planes.

Ryanair reported a 20% rise in passenger numbers for December, sending its shares to an all-time high.

"The biggest cost was a lot of the fees we gave up, like the boarding cards, the bags at the gate. But we're getting it back in passenger numbers," Sorahan said.

He said the airline expected its load factor for the 2014 to 2015 financial year will be 87%, compared with 82% for the previous year.


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