EasyJet 2009 Annual Report Download - page 6

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04 easyJet plc
q
Dear Shareholder
I am pleased to report that your Company has delivered a resilient
performance in what has been one of the most challenging trading
environments for many years. Weak consumer condence, combined
with fuel and currency volatility, has made for an uncertain business climate
in general this year, but especially so for airlines.
Against this backdrop, easyJet is one of the few airlines anywhere to remain
protable this year with underlying pre-tax prots of £44 million, compared
to £123 million last year. These results were driven primarily through good
revenue performance offsetting the £86 million unit increase in fuel costs and
£31 million reduction in interest income. We also took advantage of capacity
cuts by other carriers to advance our position in the European short-haul
market, gaining share in important markets such as Milan, Paris, Madrid and
London Gatwick and increasing our slot portfolio at congested airports
by over 10%.
Business model and strategy
In a tough economic environment, easyJet’s continued resilient performance is
a testament to the quality of its business model. Europe’s premier air transport
network, our strong customer proposition and service delivery are linked to a
highly efcient operating model that is predicated on simplicity and low cost.
As part of the annual strategy process, easyJet’s Board has agreed a eet plan
that will enable your Company to deliver growth of around 7.5% per annum1
over the next ve years. This eet plan gives easyJet the ability to take
advantage of the substantial commercial opportunities apparent in European
short-haul aviation, whilst maximising margins and delivering positive cash
generation beyond the period of the higher than normal capital expenditure
associated with the replacement of the more expensive Boeing subeet.
The plan nevertheless retains sufcient in-built exibility to allow a slowing
of growth should our margins come under pressure.
Whilst some of our strategic debate during the past 12 months was perhaps a
little too public, I believe that the subject matter and intensity of the discussion
around the most appropriate rate of growth for the Company evidences the
commitment of individual Board members to the Company’s cause. I am pleased
to report that the whole Board believes we have come to a sensible outcome.
CHAIRMAN’S STATEMENT
Annual report and accounts 2009
In a tough economic
environment, our resilient
performance is a testament
to the quality of our
business model.