Growing up

2 November 2009 By Fiona Maharg-Bravo

The budget airline says it may abandon its aggressive growth strategy from 2012 and start paying dividends. This may be a tactic to scare Boeing into sweetening terms on a massive order for planes. Either way, the discipline of dividends could support Ryanair s drifting shares.

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Ryanair, the Irish budget airline, said net profit grew 80% yearonyear to E387m in the six months to September 30. The airline said it expects to make a loss in the third and fourth quarters of the 2009/10 fiscal year, but maintained a fullyear net profit target at the low end of E200m to E300m range.

Ryanair said the results were distorted by a 42% fall in fuel costs, which masked a 17% decline in average fares

Michel O'Leary, chief executive, said talks with Boeing on ordering 200 aircraft for 201316 delivery had made little progress, adding that Ryanair could end its traditional relationship with the aircraft maker, deferring and cancelling existing orders and running the business for the next three years to maximise cash for distribution to shareholders.

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