Strong full year results for easyJet

Victoria
By Victoria November 20, 2012 19:36

Strong full year results for easyJet

During the 12 months to 30 September 2012, easyJet earned £317 million in profits before tax – a rise of 27.9% over last year. The low-cost airline’s pre-tax profit margins grew by 1 percentage point to 8.2% despite a £182 million increase in unit fuel costs. Return on Capital Employed excluding operating lease adjustment improved by 1.8 percentage points to 14.5% (while Return on Capital Employed including operating lease adjustment improved by 1.5 percentage points to 11.3%.)

Total revenue per seat grew by 5.9% (7.5% at constant currency) to £58.51 driven by: improved load factors; the annualisation of changes to fees and charges made in 2011; the careful targeting of capacity to markets with the strongest returns potential; improvements to easyJet.com; the success of the ‘Europe by easyJet’ campaign and from capacity constraint in the market.

Seats flown grew by 5.5% to 65.9 million, load factors increased by 1.4 percentage points to 88.7% and passenger numbers rose 7.1% to 58.4 million.
Cost per seat excluding fuel fell by 1% for the full year (and grew by 1.8% at constant currency). Unit cost increases were driven by increased charges at regulated airports especially in Spain and Italy and higher load factors. Cost pressures were partially offset by shorter average sector lengths, the easyJet Lean programme delivering significant savings in ground handling and non-regulated airport charges, by the increased proportion of larger A320 aircraft in the fleet and by the exceptionally low levels of disruption in comparison to previous years.
easyJet generated operating cash (excluding dividend payments) of £457 million in the year, an increase of 7.8% compared to the prior year.
In light of the continued strong financial performance of easyJet and the confidence in easyJet’s position within European short-haul aviation, the Board has decided to amend the dividend policy from this year to pay out one-third of profit after tax each year, up from the one-fifth payout introduced last year. As a result the recommended ordinary dividend is 21.5pence per share or £85 million.
Earnings per share grew 19.0% to 62.5 pence per share.

“These results demonstrate that easyJet is a structural winner in the European short-haul market against both legacy and low cost competition,” says Carolyn McCall easyJet Chief Executive said. “The strength of easyJet’s business model and strategy coupled with the hard work and dedication of the easyJet team has delivered record profits as well as a significant increase in returns for shareholders during the year.
“As evidence of its confidence in easyJet’s current position and future prospects the Board proposes to increase the dividend from 10.5p to 21.5p for the year ended September 2012 which will see our shareholders benefit from easyJet’s success with £85m of dividends.
“Whilst there is always the potential for unexpected events to temporarily impact financial results the Board of easyJet is confident that its business model, strategy and people will consistently continue to generate superior returns and growth for shareholders.”

Victoria
By Victoria November 20, 2012 19:36
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