EasyJet posts 60% increase in profits
EasyJet has delivered a 60% rise in full year pre-tax profits to £248 million and is returning £195 million to shareholders.
The budget carrier, under pressure from founder and major shareholder Sir Stelios Haji-Ioannou over dividend payments, said it was making “tangible returns” to shareholders despite a £100 million hike in fuel costs.
Overall capacity rose by 11.5% due to network expansions from Gatwick and in France and Switzerland. Passenger numbers rose 11.8% to 54.5 million and load factor improved by 0.3 percentage points to 87.3%.
Total revenue grew by 16.1% to £3,452 million resulting in growth of 4.1% in revenue per seat to £55.27. Ancillary revenue rose by 12.9% to £11.52 per seat following “decisive management action” in the second quarter of the year.
Passengers originating outside of the UK now account for 56%, an increase of 3 percentage points compared with 2010. Those flying on business increased by almost one million to 9.5 million
Underlying cost per seat fell by 1.3% for the full year with strong performances in ground handling, maintenance and disruption-related costs, the carrier said.
Chief executive Carolyn McCall said: “Despite the headwinds of higher fuel costs and a weak and uncertain economic outlook, our focus on customers, robust operational performance, the strength of EasyJet's network combined with cost control and capital discipline means that EasyJet is well placed to succeed.”
The airline took a swipe at government for reversing its election promise to turn Air Passenger Duty in to a per plane tax.
“Instead it is proposing to lower the tax on long-haul flights and increase it on short-haul flights,” EasyJet said. “Evidence shows this is both economically and environmentally damaging.
“Aviation's entry into the European Union Emissions Trading System means that there is no longer any environmental case for taxes on aviation.”
The airline also voiced concern over “monopoly infrastructure” airport and airspace providers across Europe which continue to impose higher charges despite the uncertain economic climate.
“Monopoly airports need to become more efficient, with infrastructure and associated charges built around the needs of passengers on point-to-point carriers such as easyJet. This will bring wider economic benefits by promoting tourism and trade,” EasyJet said.
Looking forward, the carrier said: “The macro-economic environment remains challenging for all airlines as weak consumer confidence across Europe slows the rate at which higher fuel prices and increased taxation can be passed onto passengers.
“Against this backdrop EasyJet is taking a cautious approach to capacity deployment. As a result, capacity in the first half of the year is planned to be flat (adjusting for disruption in the first part of the prior year), with growth of around 4% for the full year.
“With around 45% of winter seats now sold, in line with the prior year, first half passenger revenue per seat is expected to grow by mid-single digits with planned improvement in yields, bag charges and other ancillary revenues.
“Cost per seat excluding fuel and currency impact is expected to grow by 2% to 3% for the full year and by 4% in the first half of the year, assuming normal levels of disruption, driven by price increases at regulated airports and investments in new revenue streams.
“At current fuel and exchange rates easyJet's fuel bill is anticipated to increase by £220 million in full year 2012 compared to full year 2011.
“Despite the headwinds of higher fuel costs and a weak and uncertain economic outlook, our focus on customers, robust operational performance, the strength of EasyJet's network combined with cost control and capital discipline means that EasyJet is well placed to succeed.”
