Ryanair to use cash to finance capital projects

Ryanair is likely to rely on its own resources this year to finance the purchase of craft rather than going to to the bond markets.

Addressing the International Capital Markets Association annual conference yesterday, the airline's chief financial officer, Neil Sorahan, said that the carrier would use its own cash to finance it capital spending over the next few months.

Ryanair borrowed €850 million through a bond issue in 2014 on which it committed to paying 1.875 per cent interest.

While Mr Sorahan said that it would now be possible for it to raise money at 1 per cent, it would still be cheaper for the airline to use some of its own cash for capital spending.

It has gross cash of €4.5 million and net cash of €350 million. Its finance chief said that these balances were high by industry standards but they gave the carrier a cushion against the shocks to which aviation is vulnerable.

The airline is taking delivery of 183 Boeing 737 new generation aircraft. It placed the order in 2012 and the first planes arrived in 2014 and the last are due in 2020.

Ryanair launched its first Luxembourg flights on Thursday by announcing new services connecting the principality with London and Porto in Portugal.

The airline will fly Luxembourg-Stansted daily and Luxembourg-Porto five times a-week beginning in September.

The airline's chief mareting officer, Kenny Jacobs, said that the services would delivery 200,000 passengers a-year to Luxembourg Airport.

The principality will be Ryanair's 33rd country of operation in Europe.

Luxembourg Airport chief executive, Johann Venneste, said that Ryanair was the fifth airline to announce services from there this year.