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Business News

EasyJet flies high as profits soar to £317 million and dividend doubles


Surging numbers of austerity-hit firms forcing their executives to fly easyJet helped the budget carrier to post a 28% surge in pre-tax profits to a record £317 million today, giving it the confidence to more than double its dividend.

The shares flew up almost 5% as chief executive Carolyn McCall said higher fees plus business travellers choosing pricier, flexible fares helped easyJet’s average revenues per seat grow 6% to £58.51. Passenger numbers during the year to October rose 7% to approach 60 million, leaving the easyJet’s dividend — paid for the first time last year — up from 10.5p to 21.5p.

That gives easyJet’s founder and biggest shareholder Sir Stelios Haji-Ioannou, who with his family has a 38% stake in the airline, a £32 million payout. It is also a major victory for the entrepreneur, who has been lobbying for the airline to distribute cash to investors rather than expanding its fleet.

Asked whether the payout was in response to Sir Stelios’s calls, McCall diplomatically said: “The dividend is very good news for all our shareholders. It’s a sign of confidence in the future of the airline. The last few years have seen a real change in aviation across Europe as players have left, but we’re on the right side of that change. That’s why we’re increasing the dividend.”

But a spokesman for Sir Stelios said: “We are glad the board has finally seen our view on a progressive dividend policy. It shows that shareholder pressure makes  boards bend.”

MPs are among the latest to fly easyJet for work after the Houses of Parliament signed a travel deal with easyJet in September.

“Companies are becoming a lot more cost-conscious — all the High Street banks are now flying business on easyJet,” McCall said.

However, easyJet’s fuel bill increased by £182 million to £1.15 billion last year, and the company warned it will rise another £30 million this year. It is also facing £70 million of higher airports charges.

The shares rose 29.9p to 682.4p.