>> ryan air upgrades its goals for the second time this year. easy to the ceo, next. offers $9lionaire assets.for its telecom >> more signals china is slowing down. the company falls to a nine-month low. >> we have the latest on the virgin galactic crash. the defense system may have been diploid early.

-- deployed early. >> you are very welcome. a warm welcome to the second hour of the program. ryanair says a slowdown in europe might even be a good thing for the airline. ryanair is raising its profit and 700 70etween 750 million euros. here to talk about it is michael o'leary. thank you for coming to spend time with us. tell us what underlines this conflict with some of the european airlines. reflection ofis a what we started 12 months ago. much stronger forward bookings. always getting better customer

service improvements is a dream. as we expand across europe, the airports are becoming more desperate for our traffic growth. time whenanding at a business is booming. >> those airports you are talking to, who are you having the strongest conversations with, and who is hungry for your business? lufthansa, you have transactions. we announced alone that will open in march. we have just opened a new base in glasgow, where they are even flat -- either flat or cut capacity. you're going to give significant growth this winter. >> are you emotionally attached

to the further out airports you have been using previously? more central? be it is about getting those slots at a good price. >> i think it would be both. we have stepped up the growth profile. with a calf the growth will come at primary airports. half, secondary airports, it which keeps our unit costs very low. we have raised the profit forecast. profit will rise by 45%. we are keeping fares down at a time when most airlines are trying to raise prices and customers are switching to us for the lower fares. >> what are you taking those costs from? running a veryor efficient airline. where you going to pull those costs out? writes oil prices are falling. we are hedged out to march 16 at

$93 a barrel. up bye have taken factors four percentage points. it helps spread the costs across more passengers. that is the key to lowering costs. much stronger demand across most markets in europe. >> how is the industry benefiting from this? is it benefiting as much as it could have with hedging products? >> we could give you cost certainty. uncertainty locked away, stock prices were lower. frankly, as long as we can lock we have seenst, the after-tax margin jumped from 18% to 23%. only we and ryanair have the cost discipline. see air france and lufthansa and so much turmoil is the fact we are

expanding across those markets and customers are switching. >> will any of those incumbent airlines set themselves apart and the ability to cope with the pressures they are facing right now? are they all doomed? doomed, but it think they are going to get smaller. they are locked in a connecting strategy, which means there is very little concern over airport and handling costs. we are taking the market in europe. they are growing strongly. the new bases are all growing strongly. that traffic is coming directly from-our competitors. >> how is it the business traveler, the profile of this person you are trying to get to spend more, how is that going? what have you learned? you have turned us what your objective is. what have we learned? what are we going to see?

>> an interesting statistic is 27% of passengers are traveling on business, despite the fact we have never provided anything other than low fares. we have put together a package to see if we can persuade half of those to pay the small yields about 40 euros a ticket. you get reserve seats in front of the planes, fixable tickets. we will change her ticket at no fee. >> the percentage change. what is the number now? >> it will still be 27. i think the number is growing. the number who will play a premium. as we move into the winter we have fleshed out big business frequencies, three or four flights daily between the main european cities. we expect that to rise. hope to getmber we about half the passenger base, about 10 or 11%. >> do you see what you're doing with your business models,

including those developments? is it a refinement of what ryanair does, or is this a reinvention of everything without ryanair was? >> i think it is a fundamental reinvention. we have one the price war. want to move into the middle ground where we are providing a better experience, the free second carry-on bag, where we discount prices for children traveling with parents. we want to move into the middle market. as we get nicer to customers we are finding more customers are increasingly saying, we will take ryanair as the better alternative. >> i am not saying they were not nice. it is a bit of a shift. >> it is a seismic shift. the people who want to do it most is the staff. we put the staff in conflict with customers. we have said, we are ending the

conflict. we are not going to fight because the back -- bag is an inch too big. there is a surge of compliments coming back from customers about how nice people are. it is really working. people are coming to us for the prices and coming back because of better customer experience. >> what are you doing with capacity over the winter? compared to last winter, how much more flying are you going to do? >> we expect traffic to rise this winter by about 16%, which is a huge growth. there is demand for ryanair across all markets. we expect the fares to dip slightly as we fill these extra flights. it means over the year traffic will rise by 9%. unit costs will fall about 4%. will rise over last year. you'res looking at what

going for. germany, where you don't have a major presence. if you look at these strategies, italy, greece, and germany, is this a longer-term perspective on the recovery in europe? >> i think it is a bit earlier. it is a short-term bet that europe continues to be in recession. it's not going anywhere in a hurry. we are expanding very rapidly. i think we are building a huge wesence across europe, and will lead that recovery. as we are lowering the cost of air travel, more economic activity is coming. are leading the tourism industry recovering those countries. recoverysm industry will lead to more job creation, particularly for young people. as we lead that economic recovery, we are the

beneficiaries of it. >> can i bring it to politics -- can i ask about u.k. politics and what your thoughts are on the vote over whether u.k. stays in the european union? airlineof what your does is it benefits from open skies in europe. >> evocative i have been alive for 40 years the british have had this in or out attitude to europe. ultimately if it comes to a vote, i suspect an economic argument will win. yes europe needs to be reformed. ultimately, i don't see the u.k. leading. if they do people will split -- and italy go to spain on holidays. nothing is going to not unlikely change, the scottish independent referendum. people will continue to fly on ryanair. >> great to have the conversations. >> it is 10 minutes past seven

here in london. you can join our conversation on twitter. i am not sure if michael o'leary is there. he has dabbled in the dark arts. we look at the investigation of the latest news. stay with us.

>> time for company news. the publicist group is by the american digital marketing company for 3.7 billion dollars. it is an all cash transaction worth $25 a share. they are planning to raise capital to plug the 2.1 billion euro shortfall revealed during the stress test. the bank has ruled out seeking state funding. it has been bailed out twice in the last five years. they're planning to add a dash of tequila to the drinks. eo will acquire the 50% in exchange for the bush mills brand. this gives a payment of $408

million upon completion. say, "we are as long way from finding the cause the virginh of crash." the safety board has been hoping a news conference. ryan chilcote has been watching what they said. what is the latest update? >> we need to learn about feathering. effectively the focus of this press conference was about the feather mechanism. richard branson described it as a part of the aircraft that reenters theas it atmosphere. what we learned today was that it was deployed prematurely without command to do so. chris is leading the investigation. this is the normal flight.

these tailfins are referred to as feathers. after the space vehicle is launched and goes up, when it starts to return to the atmosphere, the procedure is to remove -- to move the feathers into a position where the entire body rotates to create more drag as the space vehicle is reentering the atmosphere. >> this is a mechanical process. ock yous actually a l have to unlock, and then you have to touch another lever. we know nine seconds after the the lock wasnited, engaged or disengaged, so it was unlocked, but there was never a command to actually begin the feather processing, step two in

the process. that's what we know right now. they are not saying the statement of causes a statement of fact. they are saying the investigation could take a year-long. if you are reading the papers over the weekend, we are looking at something that is a little different from the focus on fuel and the engines. >> thank you for the latest on the virgin story. 17 minutes past seven here in london. >> another huge story making the papers. the german chancellor angela merkel has gone public with her concerns about the possibility of the u.k. leaving the european union. merkel spots are a hot topic. free movement across the eu. live in berlin with a little more. how serious is this warning from merkel? cameron are personified as seeing this close relationship in the press. >> the first thing you have to remember is merkel wants the

u.k. to stay in the e.u. she has left no doubt. there is the question of how far david cameron can push his national or domestic agenda without running afoul of merkel. this is what seems to have happened here. she already made a similar comment after the last eu summit , if you remember last week, and now she presumably to her aid talking kind of rubbed it in. why is she ultimately interested in keeping the u.k. in the eu? you can see it. it's a big player, and she has always reached out to cameron during these times of stress. this is as much for her own interest really as it is for cameron, isn't it?

>> yes, in many ways that's true. the way she frames the argument is that a country like the u.k. with its free-market tradition is something that is direly needed in the eu, and we are partners in certain aspects of reform of the eu, she says, but hashe other hand, cameron been a difficult partner he opposed merkel and everyone else. the choice of eu commission president. there have been other run-ins. merkel has reached out repeatedly to cameron. this is how she sees it. now there seems to be a line in the sand, if you like. >> it almost seems as if we have these moments of great nationalist in thoset rises up

anti-eu, and then it seems to fade away. in juncker government put place was a series of tragedies. where are we with one europe, one go all togetherness -- one goal togetherness? >> that is the $64,000 question. what we do know is merkel in the past, whatever the critics say has stood up for this united europe principal when the chips were down. exit.member on greece now we are talking about the u.k. exit. she says europe can only be a player on the world stage if it holds together.

once the eu starts unraveling through nationalism or policy, it's hard to stop. >> it is always nice to get your perspective. >> 20 minutes past seven here in london. >> we are going to be live in --an were the oldest enck bank where they have to fill the gap yet again. stick with countdown. ♪

rexam and anna edwards. >> the world's oldest rank is raising capital to plug a 2.1 billion euro gap revealed by the ecb stress test. that was last week. bailed outs been twice in the last five years. they say they won't seek state aid this time around. dan is in milan. harsher can maybe that the itket is going to embrace

willingly -- how can we make sure the market is going to embrace and willingly? >> that is a difficult exercise. after a weekend of speculation on exactly what they are going to do, rumors ranging from making another move to try and get some assistance from the state, they finally put out a statement late yesterday from the bank headquarters saying the board will meet wednesday to consider a capital increase to fill the cabin the gap of about 2 billion euros. they are going back to shareholders to try to fill the shortfall. he also said in a statement they are going to try to sell some nonstrategic assets to help get the balance sheet back in order. shortly how the market reacts to all of this. the shares dropped almost 40% last week. comments about the ability to meet the gap in a short time is

not great right now. >> remind us of the timing. this is all happening quite quickly, isn't it? >> they are on a tight schedule. meetoard is going to because it has to be presented in november 10. advisingtment banks them are going to be racing to the guaranteed consortium to get all of the capital increase funding set up in time. >> we are live in berlin as the german chancellor admits the u.k. might leave the european union. a full conversation around that topic coming up in a few minutes time. stay with us here on countdown.

>> welcome back. it is monday morning. let's see how foreign exchange traders are starting to trade. they're looking at the ruble and selling it. this is quite a significant dollar-yen trade. theave the elections over weekend. what will russia do? will they acknowledge these? traders are the most bearish since 2011 on this currency.

they are saying to the market there is a risk of capital flight in russia. things could get out of hand. russia faces the danger of more capital flight. keep an eye through the trading day. the yen is at a seven-year low. you begin to understand the perspective of where the dollar yen is. the bombshell was dropped on friday the bank of japan would raise its level of quantitative easing. you are seeing the yen move lower this morning. have thelong and you aussie dollar. the aussie dollar taking a one-two punch. approvals dropped by 11% in september from august. you can see we are just retesting some of the loans. there is in a mosh well the 100

day moving average drops below the 200 day moving average. that could drop the gap to 8650. a couple of big moves potentially on that technical move. >> investigators say the engine of the virgin galactic spacecraft which crashed was intact with no signs of damage. iny say the station may have the ploy. one passenger died and the other was seriously injured. >> we are a long way from finding cost. we still have months of investigation to do. we have a lot we don't knew. -- don't know. >> a former bank of america employee has appeared in court in hong kong charged with the murder of two women. in anwere found apartment. an e-mail account said he was

out of the office indefinitely. for the first time german chancellor angela merkel voiced concerns the u.k. might leave the european union. merkel is concerned by the british prime minister's efforts to reduce free flow of workers from the other 27 countries in the eu david cameron promises to hold a referendum if he is reelected next year. for more on merkel's concerns over a british accent from the eu, we can go to berlin to speak to the senior vice president. thanks for talking to us. no independent confirmation about the content of this article, but it raises some interesting questions, doesn't? how clear is that we have a disagreement over one of the basic principles of the european union? >> i think it is pretty clear

that anybody who would challenge the fundamental principle of the working of the european union would certainly be in disagreement with germany and for the majority of other members in the european union. i think the real conflict is one in which germany has been on the side of the united kingdom when it comes to streamlining bureaucracy, cutting red tape, and gauging free-trade agreements on a global scale. all that which is seen as --ntessential british a dead agenda is something they are supportive of, but if a british prime minister goes against the fundamental principles of the european union, this is where german support stops. boxes that something, this fallout over immigration, is it something that stops angela merkel offering what it might take for britain to vote to stay in the eu if we end up with a referendum? it would first base remind many here in berlin it is important to take another step

in the direction of the united kingdom striking deals over the eu budget. potentially talking about deals on welfare provision for immigrants from the european union. that is something where many are probably on the side of david cameron. there is a perception germany is facing similar problems as the massive there is still room for agreement, but i think if we are starting to talk about the fundamentals of how the forpean union works, constituent freedoms of the market, this is something they would be unable to strike compromise. >> one of the preoccupations at the moment must be trying to get national budgets up roof i the deadline -- approved by the deadline of the 30th of november. you talk about a deal worked by

germany and france. what can you expect the deal to be looking like? >> i think a deal would be along the lines of france and southern europe committed to additional structural reform in their national economies and germany letting paris getaway with another violation of the target under stability and growth. that ties in very well with the u.k. issue. if the germans feel they are under pressure and europe when it comes in for standing for market reforms. u.k. is certainly not a member of the eurozone, they are looking towards a potential partner to drive the agenda forward in europe am a and that is what makes it risky for germany if we really were to talk about the u.k. exit from the eu. >> what is the risk and reward angela merkel is weighing when she is thinking about how hard -- how hard to push on francois

hollande, how hard to push them on reform? she must be mindful of the weakening in position in the french case, the weakening of the president's position. is she going to continue to apply more pressure? >> she would like to. her too, but the question is about political ability to do that. it is not the place where you can tell the french what to do with their economy. the one thing the germans feel more is one who comes under growing pressure from the forces , so i think in the end there is a strong awareness in berlin that berlin can achieve in terms of structural reforms on the ground in europe is limited. >> things for joining us. .reat to get your perspective

the senior vice president joining us live from berlin. is the rebel it election. voters go to the polls and eastern ukraine. what does it tell us about who didn't relations with the west? next. -- about putin's relations with the west? next.

>> time for the latest company news. offers toing company oi. the luxembourg-based holding company already owns in portugal and is pushing across europe. in the 23 billion dollar deal earlier this year. saudi arabia's national bank plans to raise $6 billion this the second largest ipo behind alibaba. it marks the biggest ever share sale in the middle east and is national investors.

it was 50% overprescribed. shares in the largest lender will be lifted in the index, which is set to open for foreign investors next year. binary has updated its profit goals for the second time this year. the company says any slowdown in the european economy could push people in its directions, and effort to attract business customers could pay off. we spoke to the ceo. >> will prices are falling. we are hedged to march 16 at about $93 a barrel. upo we have taken factors three percentage points. it helps spread the unit costs across more passengers. that is the key to lowering unit cost. >> 7:42. it is the second biggest initial public offering, and even a fat wad couldn't stop it -- fat

couldn't stop it. a landmark sale for the region. >> not just for the region, but for the world as well. in terms of the middle east this is the largest ipo ever. it is the second biggest initial public offering in the world so far this year. it is after alibaba raised four but they hadunt, the u.s. banking arm of the royal bank of scotland. there is phenomenal demands for this stock. there was a two-week subscription period. people finally found the money they wanted to invest the goes by the end of it they could have raised $58 billion, almost 10 times the amount they were planning to raise. because of such demand, the stock market is up by just over a fifth this year.

even accounting for the lower oil price. shares areing the reels --orth 65 reals. a weekd not know until or even longer. >> they are excited about this deal. the stock market in saudi arabia but what about, other issues? not everyone is enthusiastic about what is on offer here. >> the valuation of the company isn't the only thing on their minds. a lot of the concerns about sharia compliant c. does the company applied to sharia law? does it get involved in interest or things that have gambling or alcohol? -- sheik abdullah

says it is unconstitutional because it does not comply with sharia law. sell assetsnning to over the next five years. bet way they say it would sharia compliant and everybody in saudi arabia would be able to +++

>> think you very much. joining us live from tel aviv. >> voters went to the polls in eastern ukraine. ukraine's president said the move threatens the peace process. here to explain is ryan chilcote. where are we with this? the yuan has one vote. we have to see how russia response. >> the big question is is this going to lead to more sanctions against russia? the vote is going to happen. we are waiting for the results. hundreds of thousands of people came out to vote in these regions in the east under the rebels control. according to exit polls, which were official exit polls, which is strange because normally exit polls are carried out by independent observers, the front runners, the leaders in the with bigt are leading margins. the question is does it matter. the yuan, they have already said this is illegal, illegitimate, and runs counter -- the u.n., they have already said this is illegal, illegitimate, and runs counter to peace talks. if they recognize the results of what is thes,

european union and the united states going to do? we heard the foreign minister tweeting earlier this morning, saying, we're going to have to actions thisby its week. it already said it respects territorial integrity of ukraine, but they seem to be suggesting if the russians recognize the vote that wouldn't be consistent. the question is does that mean we are going to have more sanctions. a lot of people said maybe they are getting carried away. his could lead to a lot more fighting and a lot more sanctions theoretically. >> sanctions could be one of the topics. you mentioned more fighting. we have seen the fighting agreementespite that and the belarusian capital. >> in some sense the truce has been only in name, which is almost did enough for a truce. truce and i enter in a but continue to fight, and both of us say we are in a truce,

then we are in a truce, aren't we? if the moment one of the sides says it is over, the fighting has been going on this whole while at a lower level, but the rebels, including one of the leaders yesterday was saying, not only do they think the vote is legitimate, but the thing some areas that are not under their control like the area i visited about a month ago, but those should be part of their territory as well. we have heard threats they plan to attack ukrainians in those towns to take that. that would be as. >> every time we cover this story it is as if putin takes one step forward trying to de-escalate the scenario and then you have these kinds of thets where they ratcheted heat up again. that is the difficulty for the they they don't know what

are dealing with. >> i think they are exasperated with the situation. i think angela merkel for one has said this, and many eu leaders say they have been burned, that they were told one thing and something different happened. theians would maintain same. they thought there wasn't going to be an eastern expansion of nato in places like eastern ukraine, and they felt that was actually coming much closer, but there is an issue where you have thesides who don't leave other is being genuine when and makes statements of intent. that is a real problem if you are trying to build ilog. >> thank you for the latest happening on the ground and behind the scenes in ukraine. >> you are looking at a live shot. is it great? is it dark? is it still raining?

that see how the markets are going to shape up. we are going to head to the opening. we will run you through the agenda of what you need to know through the trading day and your trading week i had. stay with us.

>> welcome back. >> 7:52 here in london. the markets open

up. eight minutes, seven minutes. i guess we should look back for we look forward. we have that china data. >> good morning. is down.ial from china when this number is good everyone says, don't worry about that one. this is a little worse than anticipated. the china manufacturing pmi is in line for nonmanufacturing pmi. 53.8. looking at everyone is talking about the china slowdown. that sparks what i call happy talk about the people's bank of china and what they may do on the stimulus side of things. it is slowing down. when you look at these numbers, love 50, europe would that. whenever bandwidth they

look at dollar sterling. 159.81. she is flying the kite she can up forold the hand labor. >> immigration has become a big political issue ahead of the election. as it becomes the forefront of the debate, as the eu referendum looks like it is getting closer, particularly the conservative party, you have to look at a big? hanging over the u.k. economy. whether you side with the fact that you think it will help the u.k. economy or hinder it, this is going to be putting a? .n the debate >> if there was ever an industry that would have been impacted,

it would be an airline. they operate all over europe and beyond. they are similar to the scotland debate. he is the classic ceo. >> if we do have a vote we don't know what the relationship between an exit to the u.k. and the rest of europe would look like. is igniting a lot of uncertainty. markets hate that. theryanair aside, even slowdown is playing into his hands. >> that man should run the masters in corporate communication. >> you are right. we should be watching the m&a

news as well. he is doing more deals in portugal. you can join us on twitter. we will leave you in the capable hands of the on the move team.

>> welcome to "on the move." happy monday. we are moments away from the start of european trading. this is what we're looking at over the next 60 minutes. china's slowdown, the gauge hits a nine-month low. data from the services and a growinging signals economic slowdown. speculation policymakers may need to react. reports in germany indicate chancellor angela merkel has expressed concern for the first time that britain may be heading to the european union exit door. we will be talking to vince

cable in just over nine minutes time. goalir raises the profit for this year. the ceo tells bloomberg the economic slowdown is playing into his hands. if you are looking at futures, futures are pretty much dead flat across the eurozone. manus cranny has got the open for us. ryanair. >> a stunning set of numbers. on sterling there is really no the weekendhat. they were absolutely baying for cameron to deliver a vote on europe early next year around election time. equity markets open a little softer. trading near record highs at the end of last week. everybody is looking at growth of the consumer rather than