Ryanair bond roadshow spurs ‘a lot of excitement’

An upcoming roadshow for Ryanair has been met with a warm investor reception but the borrower will likely have to field queries about its ambitious expenditure programme and a fall in profits.

The issuer, which mandated BNP Paribas, Citigroup and Deutsche Bank last week, begins investor visits today that will conclude on Friday, and its bond will now surface after unrated Air France- KLM, which could pull the trigger on a rare euro deal as soon as this week.

Chief financial officer Howard Millar said bankers had informed him there was “a lot of excitement” about the roadshow and that the London part had been extended from one to two days. Millar said Ryanair was eyeing a possible seven-year issue.

This is despite the fact that the airline revealed its first profits fall in five years last month, a drop of 8% to €523m from €569m the year before. As it seeks to change its image, the carrier has recently initiated a number of measures designed to increase passenger numbers, including allocated seating.

And while Ryanair was awarded two corporate ratings of BBB+ from Standard & Poor’s and Fitch Ratings earlier this year, making it the highest rated airline in the world, it has just embarked on a large expenditure plan to replace its aircraft stock.

The issuer last week put the final touches to a €3bn medium-term notes programme and the proceeds from its debt capital markets activities will be put towards paying for the 180 aircraft it has on order from Boeing, as well as other general corporate purposes.