Ryanair Hldgs Net Income jumped on 79.9% in 2016 and Revenue surged on 15.6%
23 May 2016 • About Ryanair Hldgs (
$RYA) • By InTwits
Ryanair Hldgs reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Ryanair Hldgs is a growth stock: FY2016 revenue growth was 15.6%, 5 year revenue CAGR was 12.5% at FY2016 ROIC 17.2%
- Ryanair Hldgs has high CAPEX intensity: 5 year average CAPEX/Revenue was 11.2%. At the same time it's a lot of higher than industry average of 2.1%.
- CAPEX is quite volatile: 1,218 in FY2016, 789 in FY2015, 506 in FY2014, 311 in FY2013, 318 in FY2012
- The company has highly profitable business model: ROIC is at 17.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Ryanair Hldgs ($RYA) key annual financial indicators
| mln. € | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 4,390 | 4,884 | 5,037 | 5,654 | 6,536 | 15.6% |
| SG&A | 180 | 198 | 193 | 234 | 293 | 25.1% |
| EBITDA | 992 | 1,048 | 1,010 | 1,421 | 1,887 | 32.9% |
| Net Income | 560 | 569 | 523 | 867 | 1,559 | 79.9% |
Balance Sheet
|
|---|
| Cash | 2,708 | 1,241 | 1,730 | 1,185 | 1,259 | 6.3% |
| Short Term Debt | 368 | 400 | 468 | 400 | 450 | 12.6% |
| Long Term Debt | 3,257 | 3,098 | 2,616 | 4,032 | 3,573 | -11.4% |
Cash flow
|
|---|
| Capex | 318 | 311 | 506 | 789 | 1,218 | 54.4% |
Ratios
|
|---|
| Revenue growth | 21.0% | 11.2% | 3.1% | 12.3% | 15.6% | |
| EBITDA growth | 29.6% | 5.6% | -3.6% | 40.6% | 32.9% | |
| EBITDA Margin | 22.6% | 21.5% | 20.1% | 25.1% | 28.9% | 3.8% |
| Net Income Margin | 12.8% | 11.7% | 10.4% | 15.3% | 23.9% | 8.5% |
| SG&A, % of revenue | 4.1% | 4.1% | 3.8% | 4.1% | 4.5% | 0.3% |
| CAPEX, % of revenue | 7.2% | 6.4% | 10.0% | 13.9% | 18.6% | 4.7% |
| ROIC | 9.7% | 10.0% | 9.5% | 13.3% | 17.2% | 3.9% |
| ROE | 17.9% | 17.3% | 15.9% | 23.7% | 40.9% | 17.2% |
| Net Debt/EBITDA | 0.9x | 2.2x | 1.3x | 2.3x | 1.5x | -0.8x |
Revenue and profitability
The company's Revenue surged on 15.6% in FY2016. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 6.2 pp from 28.3% to 34.5% in 2016.
SG&A as a % of Revenue showed almost no change in FY2016.
Net Income marign increased on 8.5 pp from 15.3% to 23.9% in FY2016.
Capital expenditures (CAPEX) and working capital investments
Ryanair Hldgs's CAPEX/Revenue was 18.6% in FY2016. The company's CAPEX/Revenue jumped on 12.3 pp from 6.4% in FY2013 to 18.6% in FY2016. It's average level of CAPEX/Revenue for the last three years was 14.2%.The company invested a big chunk of EBITDA (64.5%) to CAPEX to secure its growth.
Return on investment
The company operates at high and attractive ROE (40.86%) while ROIC is a bit lower (17.24%). ROIC increased on 3.9 pp from 13.3% to 17.2% in FY2016. ROE jumped on 17.2 pp from 23.7% to 40.9% in FY2016.
Leverage (Debt)
Debt level is 1.5x Net Debt / EBITDA and 2.1x Debt / EBITDA. Net Debt / EBITDA dropped on 0.8x from 2.3x to 1.5x in FY2016. Debt decreased on 9.2% in FY2016 while cash increased on 6.3% in FY2016.
Appendix 1: Peers in Travel & Leisure
Below we provide Ryanair Hldgs benchmarking against other companies in Travel & Leisure industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Dalata Hotel Group ($DAL) | 55.4% | 12.0% | 30.4% | 185.4% | |
| Everyman Media Group ($EMAN) | 23.4% | 26.5% | 22.4% | 44.1% | |
| Webis Holdings ($WEB) | 8.7% | 46.3% | -55.0% | 29.7% | |
| Paddy Power ($PAP) | 30.9% | 14.0% | 18.3% | 24.1% | |
| Hanatour Service Inc ($TOUR) | 15.0% | 14.6% | 9.3% | 19.2% | |
| |
|---|
| Median (22 companies) | 12.3% | 8.2% | 7.2% | 7.3% | 7.5% |
|---|
| Ryanair Hldgs ($RYA) | | 11.2% | 3.1% | 12.3% | 15.6% |
Top companies by Gross margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Eclectic Bar Grp ($BAR) | 79.1% | 78.9% | 79.0% | 79.4% | |
| Paddy Power ($PAP) | 84.7% | 82.8% | 81.0% | 74.7% | |
| Action Hotels ($AHCG) | 75.1% | 75.0% | 73.3% | 74.0% | |
| Dalata Hotel Group ($DAL) | 61.2% | 62.0% | 62.8% | 61.5% | |
| Everyman Media Group ($EMAN) | 57.6% | 59.2% | 58.9% | 58.0% | |
| |
|---|
| Median (12 companies) | 29.5% | 30.8% | 30.2% | 31.2% | 19.1% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Action Hotels ($AHCG) | 31.0% | 27.9% | 28.6% | 34.3% | |
| Air China ($AIRC) | 19.7% | 16.0% | 18.4% | 27.3% | |
| Mandarin Oriental International ($MDOB) | 19.5% | 22.4% | 24.0% | 26.2% | |
| Irish Continental Group ($ICGC) | 17.1% | 18.6% | 27.3% | 23.6% | |
| Young & Co'S Brewery ($YNGN) | 21.2% | 21.8% | 21.7% | 22.9% | 22.9% |
| |
|---|
| Median (23 companies) | 12.8% | 12.9% | 12.3% | 12.8% | 16.7% |
|---|
| Ryanair Hldgs ($RYA) | 22.6% | 21.5% | 20.1% | 25.1% | 28.9% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Action Hotels ($AHCG) | 21.0% | 25.6% | 90.0% | 172.4% | |
| Everyman Media Group ($EMAN) | 0.0% | 36.4% | 25.9% | 56.4% | |
| Marston'S ($MARS) | 18.0% | 19.3% | 17.5% | 16.2% | 15.3% |
| Young & Co'S Brewery ($YNGN) | 14.3% | 8.7% | 10.8% | 14.3% | 16.9% |
| Ana Hldgs Inc ($ANA) | 12.8% | 10.1% | 10.5% | 14.1% | 14.1% |
| |
|---|
| Median (23 companies) | 3.7% | 4.8% | 4.5% | 8.2% | 14.7% |
|---|
| Ryanair Hldgs ($RYA) | 7.2% | 6.4% | 10.0% | 13.9% | 18.6% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Paddy Power ($PAP) | 53.4% | 47.2% | 47.6% | 53.2% | |
| Irish Continental Group ($ICGC) | 14.6% | 18.9% | 40.0% | 33.9% | |
| Air Partner ($AIP) | 34.8% | 27.5% | 21.2% | 20.0% | 20.4% |
| Hanatour Service Inc ($TOUR) | 22.5% | 19.9% | 19.6% | 19.4% | |
| Richoux Group ($RIC) | 12.9% | 9.8% | 9.1% | 10.8% | |
| |
|---|
| Median (23 companies) | 6.4% | 6.9% | 4.2% | 5.8% | 8.0% |
|---|
| Ryanair Hldgs ($RYA) | 9.7% | 10.0% | 9.5% | 13.3% | 17.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Meikles Ltd ($MIK) | | 5.1x | 10.7x | 73.1x | |
| Action Hotels ($AHCG) | 11.2x | 7.8x | 9.6x | 12.3x | |
| Marston'S ($MARS) | | 6.5x | 14.0x | 8.2x | 6.2x |
| Peel Hotels ($PHO) | 8.2x | 7.3x | 5.9x | 4.4x | 3.9x |
| Rotala ($ROL) | 2.6x | 3.1x | 2.8x | 3.6x | |
| |
|---|
| Median (20 companies) | 1.4x | 2.3x | 1.1x | 2.0x | 2.8x |
|---|
| Ryanair Hldgs ($RYA) | 0.9x | 2.2x | 1.3x | 2.3x | 1.5x |
