annual report 2009 - Aer Lingus

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26 Directors’ Report Aer Lingus Group Plc – Annual Report 2009Directors’ ReportYear ended 31 December 2009IntroductionThe Directors present their report to shareholders, together with thefinancial statements of Aer Lingus Group plc and the IndependentAuditors’ report thereon, for the year ended 31 December 2009.Principal activities and future developmentsThe principal activities during the year continued to be the provisionof air travel services. The Chairman’s Statement and Chief ExecutiveOfficer’s Review on pages 2 to 5 report on developments duringthe year, on the state of affairs at 31 December 2009, on eventssince 31 December 2009, and on likely future developments. Furtherinformation with respect to the review of the business and futuredevelopments is contained in the Operating and Financial Reviewon pages 6 to 9. The financial statements for the year ended31 December 2009 are set out in detail on pages 45 to 89.Information on the key performance indicators applicable tothe Group are detailed in the Financial Highlights on page 1,the Chairman’s Statement on pages 2 to 3, the Chief ExecutiveOfficer’s Review on pages 4 to 5 and in the Operating andFinancial Review on pages 6 to 9.Results for the year and state of affairs as at31 December 2009The consolidated income statement for the year ended 31 December2009 and the consolidated statement of financial position at thatdate are set out on pages 45 and 47 respectively. The loss for theyear after tax amounted to €130.1m (2008: loss of €109.9m).The movement on the retained earnings for the year is as follows:€mBalance, 31 December 2008(51.2)Loss for the year(130.1)Loss on cancellation of treasury shares(7.0)Balance, 31 December 2009(188.3)Total equity decreased by €58.0m during the year as a result ofthe loss for the year €130.1m, a loss on the cancellation of treasuryshares of €7.0m and an increase in other reserves of €79.1m. Nofurther transfers to or from reserves are proposed by the Directors.Substantial interests in share capitalAs at 27 April 2010, the Directors are aware of the followingsubstantial interests in the share capital of the Company,which represent more than 3% of the issued share capital.Share held% of issuedshare capitalRyanair Limited 159,231,025 29.82%Minister for Financeof Ireland 134,109,026 25.11%Aer Lingus ESOPTrustee Limited 66,577,980 12.47%As far as the company is aware, other than stated above, no otherperson or company has an interest of more than 3% in the sharecapital of the company.Accounting policiesThe Group accounts are prepared under International FinancialReporting Standards as adopted by the EU. The principal accountingpolicies, together with the basis of preparation of the accounts are setout on pages 52 to 63.DividendsThe Directors do not propose the payment of dividends in respectof the year ended 31 December 2009.Principal risks and uncertaintiesInformation on the principal risks and uncertainties facing the Groupare detailed in the Operating and Financial Review on pages 8 to 9.The Financial Risk Management policies in place to address these areset out in Note 3 to the consolidated financial statements.Directors and SecretaryThe names of the current Directors appear on pages 10 to 11,together with a short biographical note on each Director. TheDirectors who served during the year are listed below:Colm BarringtonDavid BeggLeslie BuckleyThomas CorcoranSean CoyleLaurence CrowleyIvor FitzpatrickDanuta GrayFrancis HackettColin HuntMichael JohnsDermot MannionAnne MillsThomas MoranChristoph MuellerChris Wall
Directors’ Report Aer Lingus Group Plc – Annual Report 200927Mr Laurence Crowley was appointed to the Board on 9 January 2009.Mr Chris Wall ceased to be a Director on 5 March 2009 when theCompany was informed by the Minister for Transport of Ireland thatMr Chris Wall’s appointment as a “Minister’s Nominee” had expired.Mr Leslie Buckley was nominated for appointment to the Board bythe Minister for Transport, and was appointed as a non-executivedirector on 18 May 2009. Mr Buckley is designated a “Minister’sNominee” in accordance with the Company’s Articles of Association.Mr Christoph Mueller was appointed to the Board on 14 September2009 and will be put forward for election at the forthcoming AnnualGeneral Meeting.Mr Ivor Fitzpatrick and Ms Anne Mills were both re-elected at theCompany’s Annual General Meeting during the year. On 21 March2010 Ms Anne Mills retired upon the expiry of her term of office asa director.Mr Colm Barrington, Mr Laurence Crowley and Mr Sean Coylewere each elected at the Company’s Annual General Meetingduring the year.Mr Dermot Mannion resigned from the Board on 6 April 2009.Mr Sean Coyle resigned from the Board on 31 December 2009.Mr Tom Corcoran and Mr Tom Moran will retire by rotation asdirectors in accordance with the Articles of Association at theforthcoming Annual General Meeting and following rigorousreview are being recommended for re-election. None of thenon-executive directors retiring by rotation has a service contractwith the Company.The interest of the Directors in office at 31 December 2009 in theshares of the Group are outlined in the Report of the RemunerationCommittee on Directors Remuneration on page 41.During the year ended 31 December 2009, the Company Secretarywas granted a conditional award of 70,403 shares under the LTIP inrespect of the vesting period 1 January 2009 to 31 December 2011.Any vesting of these shares is subject to the achievement of theperformance targets outlined in the LTIP and the rules of the LTIP.Since the year-end Mr Montie Brewer and Ms Nicola Shaw havebeen appointed as directors and will be put forward for electionat the forthcoming Annual General Meeting.There were no contracts or arrangements entered into during theyear in which a director was materially interested and which weresignificant in relation to the Group’s business.Statement of Directors’ responsibilitiesThe Directors are responsible for preparing the annual report and thefinancial statements in accordance with applicable law and regulations.Irish company law requires the Directors to prepare financialstatements for each financial year. Under that law the Directors haveprepared the financial statements in accordance with InternationalFinancial Reporting Standards (IFRSs) as adopted by the EuropeanUnion (EU). The financial statements are required by law to give atrue and fair view of the state of affairs of the company and the groupand of the profit or loss of the group.In preparing these financial statements the Directors are required to:• select suitable accounting policies and then apply themconsistently;• make judgments and estimates that are reasonable and prudent;• state that the financial statements comply with IFRSs as adoptedby the European Union, and• prepare the financial statements on the going concern basisunless it is inappropriate to presume that the group and theparent company will continue in business.The Directors are also required by applicable law and the ListingRules issued by the Irish Stock Exchange, to prepare a directors’report and reports relating to directors’ remuneration and corporategovernance. In accordance with the Transparency (Directive2004/109/EC) Regulations 2007 (“the Transparency Regulations”),the Directors are required to include a management report containinga fair review of the business and a description of the principal risksand uncertainties facing the group.The Directors are responsible for keeping proper books of account thatdisclose with reasonable accuracy at any time the financial position ofthe Company and the Group and to enable them to ensure that thefinancial statements comply with the Companies Acts 1963 to 2009and, as regards the group financial statements, Article 4 of the IASRegulation. They are also responsible for safeguarding the assets ofthe Company and the Group and for taking reasonable steps for theprevention and detection of fraud and other irregularities.The Directors are responsible for the maintenance and integrity of thecorporate and financial information included on the Group’s website.Legislation in the Republic of Ireland governing the preparation anddissemination of financial statements may differ from legislation inother jurisdictions.
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