EasyJet 2011 Annual Report Download

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Annual report and accounts 2011

Table of contents

  • Page 1
    Annual report and accounts 2011

  • Page 2
    ...Strategic position Strategy implementation Market review Looking forward to 2012 Key performance indicators 08 09 10 13 13 14 16 5 Governance Chairman's introduction Board of directors Executive management team Corporate governance Shareholder information Report on Directors' remuneration Statement...

  • Page 3
    01 Overview Performance and risk Corporate responsibility Business review Governance Accounts & other information 3 3 3 04 06 02 OVERVIEW OVERVIEW Highlights Chairman's introduction Turning Europe Orange Our cause 03 3 1

  • Page 4
    ...a £100 million increase in unit fuel costs. This strong performance is due to firm control of costs, effective yield management, the strength of easyJet's network and focus on customers - Return on Capital Employed (ROCE) improved by 3.9 percentage points to 12.7% - On time performance improved by...

  • Page 5
    ...Overview Chairman's introduction easyJet plc Annual report and accounts 2011 Business review Performance and risk I am pleased to report that your Company has delivered a good financial performance this year and the business has strengthened. easyJet is well placed and the Board is confident...

  • Page 6
    ... Load factor % 2011 2010 2009 2008 2007 87.3 87.3 87.0 85.5 84.1 83.7 We have increased the number of routes offered to our passengers and focused this growth across continental Europe. Our network is truly pan-European Number of routes by country UK Switzerland France Italy Germany Spain 300 72...

  • Page 7
    ... easyJet plc Annual report and accounts 2011 Business review Performance and risk Corporate responsibility Governance 19 bases 204* aircraft 547 routes France Germany Italy Spain aircraft 41 18 22 aircraft 22 29 16 8 UK aircraft 21 8 aircraft 19 Number of routes Number of routes...

  • Page 8
    ... right it will enable us to deliver our ambition of becoming Europe's preferred short-haul airline making market leading returns. We're passionate about connecting people by making travel easy and affordable. We're on our customers' side and our people make the difference. We have a big ambition...

  • Page 9
    07 Overview BUSINESS REVIEW Business review Performance and risk Our long-term strategy Chief Executive's introduction Strategic position Strategy implementation Market review Looking forward to 2012 Key performance indicators 08 09 10 13 13 14 16 3 3 3 3 3 3 3 Corporate responsibility ...

  • Page 10
    ... plc Annual report and accounts 2011 Our long-term strategy Safe and sustainable We will never compromise our commitment to safety, which is always the first priority for all our people, and we continually strive to improve our sustainability. Focus on customer Focused on network development...

  • Page 11
    ... plc Annual report and accounts 2011 Business review Performance and risk Introduction easyJet has made strong progress this year in the execution of its strategy. Our strong operational and financial performance is a result of the hard work and commitment of easyJet's people to make travel...

  • Page 12
    ... customers and executing the strategy to create value for shareholders. Consequently improving communication and engagement have been given a high priority this year as the whole of the Executive Management Team have travelled extensively across the network. europe by easyJet easyJet has made good...

  • Page 13
    11 Overview easyJet plc Annual report and accounts 2011 Business review Example only. Not a current offer. Performance and risk easyJet remains concerned that monopoly infrastructure providers across Europe, of both airports and airspace, continue to impose higher charges, despite the ...

  • Page 14
    12 easyJet plc Annual report and accounts 2011 Chief Executive's introduction Continued During the past financial year, the Company took advantage of the agreement signed with Airbus in 2002 and converted 15 A320-family aircraft that had been under option to the Company since June 2007 into firm...

  • Page 15
    ... 2011. Against this backdrop easyJet performed well with total revenue per seat growth of mid single digits. At London Gatwick easyJet significantly increased frequency on many of the busiest business routes such as Madrid, Milan, Rome and Amsterdam. easyJet also increased its market share at bases...

  • Page 16
    14 easyJet plc Annual report and accounts 2011 Chief Executive's introduction Continued Example only. Not a current offer. has gained share on routes to London, Milan and Madrid as competitors have retreated. Switzerland has also seen a stable economic environment and easyJet's focus in 2011 has ...

  • Page 17
    15 Overview easyJet plc Annual report and accounts 2011 Business review Performance and risk At current fuel7 and exchange rates easyJet's fuel bill is anticipated to increase by £220 million in 2012 compared to 2011. Despite the headwinds of higher fuel costs and a weak and uncertain economic ...

  • Page 18
    16 easyJet plc Annual report and accounts 2011 Key performance indicators We monitor the performance of the business and performance against our strategic objectives using the following key performance indicators. Financial discipline We are committed to improving shareholder returns whilst ...

  • Page 19
    17 Overview easyJet plc Annual report and accounts 2011 Business review Focus on customer Focused on network development We are focused on improving our routes, slots and bases to build on our leading presence across Europe. Presence on top 100 routes Ranked by primary airport easyJet BA/Iberia...

  • Page 20
    18 PERFORMANCE OVERVIEW AND RISK Financial review Introduction Financial performance Earnings per share Cash flows and financial position Going concern Significant contracts and creditor policy Principal risks and uncertainties 19 19 22 24 24 25 25 27 3 3 3 3 3 3 3 3 3

  • Page 21
    ... review easyJet plc Annual report and accounts 2011 Business review Performance and risk Introduction easyJet produces a strong financial performance despite continuing pressures from the macroeconomic environment. During 2011 easyJet continued to grow its network successfully with an increase...

  • Page 22
    ...Financial review Continued Operational measures 2011 2010 Change Seats ï¬,own (millions) Passengers (millions) Load factor Available Seat Kilometres (ASK) (millions) Revenue Passenger Kilometres (RPK) (millions) Average sector length (kilometres) Sectors Block hours Number of aircraft owned/leased...

  • Page 23
    21 Overview easyJet plc Annual report and accounts 2011 Business review Example only. Not a current offer. Performance and risk T otal revenue 2011 currency split A euro B sterling C other (principally swiss franc) 44% 47% 9% A Exchange rates Capacity growth in the year of 6.5 million seats ...

  • Page 24
    ...cant price increases at regulated airports and planned investment in crew standby levels. Operating costs excluding fuel Underlying costs * £ million £ per seat 2011 Pence per ASK £ million £ per seat 2010 Pence per ASK Ground operations Crew Navigation Maintenance Selling and marketing Other...

  • Page 25
    ...easyJet plc Annual report and accounts 2011 Business review Performance and risk Fuel cost £ million 292 1,100 1,000 900 72 800 700 600 2010 Volume Market price Jet hedging Foreign exchange hedging 2011 186 to $818 per tonne; in sterling terms an increase of £63 to £508. Of the total increase...

  • Page 26
    ... statement of financial position 2011 £ million 2010 £ million Change £ million *stated net of disposal proceeds of £75 million in 2011. In line with prior years, easyJet generated strong operating cash ï¬,ow in the year principally driven by growth in forward bookings and revenue per seat...

  • Page 27
    25 Overview easyJet plc Annual report and accounts 2011 Business review Example only. Not a current offer. Performance and risk Net assets increased by £204 million over the year driven by the profit for the year offset by a small net change in the hedging reserve. The net book value of ...

  • Page 28
    26 easyJet plc Annual report and accounts 2011 Financial review Continued Our main insurers are Global, La Reunion, AXA, Canada Life, QBE and Houston Casualty Company Europe. One of our biggest costs is fuel and our main suppliers are Shell, Air BP, Exxon, Air Total and Q8. Our IT systems include ...

  • Page 29
    ... Risk Management System - Incident reporting - Safety Review Board - Safety Action Group Management and control system for our operations. Weekly operations meetings and reporting. Regular review by the Board of Directors. We have response systems in place and provide training for crisis management...

  • Page 30
    28 easyJet plc Annual report and accounts 2011 Financial review Continued Strategic impact Risk description and potential impact Prevailing inherent risk trend Current mitigation Financial impact of mass disruption in peak seasonal months A number of factors can lead to widespread disruption ...

  • Page 31
    ... plc Annual report and accounts 2011 Business review Example only. Not a current offer. Performance and risk Strategic impact Risk description and potential impact Prevailing inherent risk trend Current mitigation REPUTATIONAL RISKS Competition and industry consolidation easyJet operates...

  • Page 32
    ...current offer. Strategic impact Risk description and potential impact Prevailing inherent risk trend Current mitigation FINANCIAL DISCIPLINE Missing optimisation opportunities for aircraft ï¬,eet and network portfolio easyJet has a leading presence on the top 100 routes in Europe and positions...

  • Page 33
    31 Overview Business review Performance and risk Corporate responsibility Governance Accounts & other information 3 3 3 36 33 32 OVERVI CORPORATE EW RESPONSIBILITY 32 3 Introduction Safety People Environment 4

  • Page 34
    32 easyJet plc Annual report and accounts 2011 Corporate responsibility At easyJet we view ourselves as a responsible European airline. We want to achieve our ambition of becoming Europe's preferred short-haul airline and in order to do so we are always looking at safer, more sustainable and ...

  • Page 35
    ... easyJet plc Annual report and accounts 2011 Business review Example only. Not a current offer. Performance and risk The Safety Management System (SMS) launched in 2009 has continued to extend its inï¬,uence across the organisation to ensure that the highest standards of safety risk management...

  • Page 36
    34 easyJet plc Annual report and accounts 2011 Corporate responsibility Continued 2011 saw a lot of work on ensuring a stable and efficient crew planning and rostering approach to ensure that we could operate effectively through our busiest summer months. We increased standby across the network, ...

  • Page 37
    ... network. As at 30 September 2011, easyJet employed 8,288 people (2010: 7,359), based throughout Europe as illustrated below; United Kingdom Switzerland France Spain Italy Germany Netherlands Total 5,116 666 774 614 797 320 1 8,288 Organisation To succeed in our corporate ambitions, we need...

  • Page 38
    ... plc Annual report and accounts 2011 Corporate responsibility Continued Share schemes We once again offered all our people the opportunity to join its popular all-employee share plan, easyJet Shares 4 Me. The plan has won five major awards to date, and involves three elements: Save As You Earn...

  • Page 39
    37 Overview easyJet plc Annual report and accounts 2011 Business review Example only. Not a current offer. Performance and risk Environment The aim of our business is to be as efficient as we can be - this applies to our environmental impact as well. Our environmental policy is governed by ...

  • Page 40
    38 easyJet plc Annual report and accounts 2011 Corporate responsibility Continued We believe the most significant environmental impact is on climate change. This is the dominant global environmental issue, and it also is of long-term strategic importance to the airline industry. We have therefore...

  • Page 41
    ... plc Annual report and accounts 2011 Business review Example only. Not a current offer. Performance and risk We now use a single engine to taxi the aircraft before departure at airports where it is possible to do this. This saves 7.9 kg of CO2 per departure, and across the network we have saved...

  • Page 42
    40 GOVERNANCE Chairman's introduction Board of directors Executive management team Corporate governance Shareholder information Report on Directors' remuneration Statement of Directors' responsibilities 41 42 44 46 51 52 62 3 3 3 3 3 3 3 5

  • Page 43
    ... of the day-to-day operational issues facing the Company. This was in addition to the introduction of an enhanced induction programme for our new non executive directors during the course of the year. There have been a number of changes to the Board during the year with the addition of three...

  • Page 44
    42 easyJet plc Annual report and accounts 2011 Board of Directors Sir Michael Rake Non Executive Chairman (1948) Michael (1948) was appointed to the Board of easyJet as Deputy Chairman on 1 June 2009 and became Chairman on 1 January 2010. He is Chairman of BT Group plc, as well as a Non Executive...

  • Page 45
    43 Overview easyJet plc Annual report and accounts 2011 Business review David Bennett Independent Non Executive Director (1962) David (1962) was appointed to the Board of easyJet on 1 October 2005 and is Chairman of the Audit Committee. He is currently Chairman of Pacnet, a Pan-Asian provider ...

  • Page 46
    44 easyJet plc Annual report and accounts 2011 Executive Management Team Alita Benson People Director (1967) Alita (1967) joined easyJet in February 2011 as Head of HR Central Services and in June 2011 was appointed as People Director. Before joining easyJet, Alita was Head of HR Business ...

  • Page 47
    45 Overview easyJet plc Annual report and accounts 2011 Business review Chris Kennedy Chief Financial Officer (1964) See Directors' profiles. Performance and risk Cath Lynn Customer and Revenue Director (1964) Cath (1964) joined easyJet in 2002 following the merger with Go, in which she ...

  • Page 48
    46 easyJet plc Annual report and accounts 2011 Corporate governance Principles statement easyJet is committed to meeting the required standards of corporate governance. Statement of compliance During the year, the Board considers that it and the Company have complied without exception with the ...

  • Page 49
    ...Independent Non Executive Director has also acted as an alternative point of contact and both incumbents in the role during the year have attended meetings in order to help develop a balanced understanding of the issues and concerns of major shareholders. Regular feedback is provided to the Board on...

  • Page 50
    ...easyJet plc Annual report and accounts 2011 Corporate governance Continued The Board has reviewed the composition of the Remuneration Committee during the year and is satisfied that the Directors who are currently members of this Committee are those who are best able to contribute to the Committee...

  • Page 51
    49 Overview easyJet plc Annual report and accounts 2011 Business review During the year the Audit Committee's business has included the following items: - Half Year Results - Annual Results - Internal Audit Plan and Reports, including: - key internal audit reports - control themes - follow...

  • Page 52
    ... are regular Commercial, Financial and IT functional meetings - The Executive Management Team meets regularly to consider significant risks. Individual department and overall business performance is reviewed. The reporting of significant risks to the Executive Management Team and the Board has been...

  • Page 53
    ...Shareholder information easyJet plc Annual report and accounts 2011 Business review Share capital Details of the movements in authorised and issued share capital during the year are provided in note 17 to the accounts. The rights and obligations attaching to the Company's ordinary shares are set...

  • Page 54
    ...achieve annual financial and operational performance objectives and a longterm incentive plan which is intended to reward executives over the longer term, with recurring annual grants and performance conditions which reflect the stated strategic objective of the Company of return on capital employed...

  • Page 55
    ...Committee - Salary - Bonus - Achievement of bonus for 2011 - Long Term Incentive Plan - Employee share plan participation - Executive Director shareholding requirements - Pension contributions - External appointments - Service contracts - Non Executive Directors (NEDs) - Total shareholder...

  • Page 56
    ...main strategic objective - Based on return on capital employed (ROCE) - Performance measured over three years - Vests after three years - Subject to 175% of salary shareholding requirement - Annual grant of performance shares - Opportunity to defer bonus and obtain future matching share awards...

  • Page 57
    ... Directors' annual bonus opportunities in the financial year ended 30 September 2011 were as follows: As percentage of maximum bonus opportunity Measure Carolyn McCall Chris Kennedy Corporate responsibility Profit before tax Customer satisfaction targets Operating costs (excluding fuel) per seat...

  • Page 58
    56 easyJet plc Annual report and accounts 2011 Report on Directors' remuneration Continued Achievement of bonus for 2011 Achievement % A B C D E A B C D E Profit before tax On time performance Customer satisfaction targets Operating costs (excluding fuel) per seat at constant currency ...

  • Page 59
    57 Overview easyJet plc Annual report and accounts 2011 Business review Pension contributions easyJet normally makes a contribution for Executive Directors to a defined contribution pension scheme of 7% of basic salary. While individuals are not obliged to make a contribution, easyJet operates a...

  • Page 60
    ... current fee level of NEDs fees were agreed in October 2010 and have remained unchanged since then and are applicable for the year ending 30 September 2012. Total shareholder return Given the nature of easyJet's operations, the Committee does not consider that there is a suitable comparator group...

  • Page 61
    ... made by the Company. There was no increase to Executive Directors' basic pay during the year under review. Directors' interests The following current Directors hold direct interests in the share capital of easyJet: 30 September 30 September 2011 2010 Number Governance Carolyn McCall OBE Chris...

  • Page 62
    60 easyJet plc Annual report and accounts 2011 Report on Directors' remuneration Continued Directors' share awards (audited) Details of share options and share awards under the schemes described above granted to the Directors of the Company and any movements during the year are shown in the ...

  • Page 63
    ...the issue of new shares. Long Term Incentive Plan (A) Awards prior to those made during the year under review were subject to the achievement of the following Return on Equity targets: Grant date Threshold (25% vests) Target (50% vests) Maximum (100% vests) Performance and risk Basis year 5 July...

  • Page 64
    ... that the Company's auditors are aware of that information. The Annual Report on pages 1 to 62 was approved by the Board of Directors and authorised for issue on 14 November 2011 and signed on behalf of the Board by: Carolyn McCall OBE Chief Executive Officer Chris Kennedy Chief Financial Officer

  • Page 65
    ... accounts Company statement of financial position Company statement of changes in equity Company statement of cash flows Notes to the Company accounts Five year summary Glossary 64 65 66 67 68 69 70 98 99 100 101 103 104 Business review 3 3 3 3 3 3 3 Performance and risk 3 3 3 3 3 3 Corporate...

  • Page 66
    64 easyJet plc Annual report and accounts 2011 Independent auditors' report to the members of easyjet plc We have audited the accounts of easyJet plc for the year ended 30 September 2011 which comprise the Consolidated income statement, Consolidated statement of comprehensive income, Consolidated ...

  • Page 67
    ... Overview Consolidated income statement easyJet plc Annual report and accounts 2011 Business review Year ended Year ended 30 September 30 September 2011 2010 £ million £ million Notes Passenger revenue Ancillary revenue Total revenue Ground operations Fuel Crew Navigation Maintenance Selling...

  • Page 68
    66 easyJet plc Annual report and accounts 2011 Consolidated statement of comprehensive income Year ended Year ended 30 September 30 September 2011 2010 £ million £ million Notes Profit for the year Other comprehensive income Cash flow hedges Fair value gains in the year Gains transferred to ...

  • Page 69
    ... Overview Consolidated statement of financial position easyJet plc Annual report and accounts 2011 Business review 30 September 30 September 2011 2010 £ million £ million Notes Non-current assets Goodwill Other intangible assets Property, plant and equipment Derivative financial instruments...

  • Page 70
    ...easyJet plc Annual report and accounts 2011 Consolidated statement of changes in equity Share capital £ million Share premium £ million Hedging reserve £ million Translation reserve £ million Retained earnings £ million Total £ million At 1 October 2010 Total comprehensive income Share...

  • Page 71
    69 Overview Consolidated statement of cash flows easyJet plc Annual report and accounts 2011 Business review Year ended Year ended 30 September 30 September 2011 2010 £ million £ million Notes Cash flows from operating activities Cash generated from operations Net interest and other ...

  • Page 72
    ... 1 Accounting policies Statement of compliance easyJet plc (the "Company") and its subsidiaries ("easyJet" or the "Group" as applicable) is a low cost airline carrier operating principally in Europe. The Company is a public limited company whose shares are listed on the London Stock Exchange under...

  • Page 73
    ... other payables until it is recognised in the income statement when the service is provided. Governance Ancillary revenue primarily arises from the provision of checked baggage and speedy (priority) boarding services, booking, credit card and change fees, and commissions earned from services sold...

  • Page 74
    ... over the shorter of the lease term and their expected useful lives, as shown above. Residual values, where applicable, are reviewed annually against prevailing market rates at the balance sheet date for equivalently aged assets and depreciation rates adjusted accordingly on a prospective basis...

  • Page 75
    73 Overview easyJet plc Annual report and accounts 2011 Business review Leases Non-contingent operating lease rentals are charged to the income statement on a straight-line basis over the life of the lease. A number of operating leases require easyJet to make contingent rental payments based on ...

  • Page 76
    ...Annual report and accounts 2011 Notes to the accounts Continued 1 Accounting policies continued When a hedged future transaction is no longer expected to occur, any related gains and losses previously recognised in shareholders' equity are immediately recognised in the income statement. Financial...

  • Page 77
    ... Term Incentive Plan and Share Incentive Plan is the share price at the date of grant. Performance and risk The fair value of the estimated number of options and awards that are expected to vest is expensed to the income statement on a straight-line basis over the period that employees' services...

  • Page 78
    76 easyJet plc Annual report and accounts 2011 Notes to the accounts Continued 1 Accounting policies continued New standard and interpretations not applied The following standards and interpretations issued by the International Accounting Standards Board have not been applied in preparing these ...

  • Page 79
    ... 2010 £ million Short-term employee benefits Share-based payments 6 2 8 6 2 8 Governance The Directors of easyJet plc and the other members of the Executive Management Team are easyJet's key management as they have collective authority and responsibility for planning, directing and controlling...

  • Page 80
    78 easyJet plc Annual report and accounts 2011 Notes to the accounts Continued 5 Tax charge Tax on profit on ordinary activities 2011 £ million 2010 £ million Current tax United Kingdom corporation tax Foreign tax Prior year adjustments Total current tax credit Deferred tax Temporary ...

  • Page 81
    ... to shareholders' equity Current tax credit on share-based payments Deferred tax charge on share-based payments - (1) (1) 2 (3) (1) 9 (23) Performance and risk Deferred tax The net deferred tax liability in the statement of financial position is as follows: Accelerated Short-term capital timing...

  • Page 82
    80 easyJet plc Annual report and accounts 2011 Notes to the accounts Continued 6 Earnings per share Basic earnings per share has been calculated by dividing the profit for the year by the weighted average number of shares in issue during the year after adjusting for shares held in employee share ...

  • Page 83
    ...from the strategic plan for the period up to 2015 approved by the Board, using the following key assumptions: Pre-tax discount rate (derived from weighted average cost of capital) Fuel price (US dollars per metric tonne) Exchange rates US dollar Euro Swiss franc 1.60 1.15 1.30 9-10% 1,060 Corporate...

  • Page 84
    82 easyJet plc Annual report and accounts 2011 Notes to the accounts Continued 8 Property, plant and equipment Aircraft and Leasehold spares improvements £ million £ million Other £ million Total £ million Cost At 1 October 2010 Additions Aircraft sold and leased back Transfer to intangible ...

  • Page 85
    ... easyJet plc Annual report and accounts 2011 Business review 9 Loan notes In 2001, easyJet in a consortium with six other UK airlines formed The Airline Group Limited in order to acquire a minority interest in NATS, the company that owns the UK air traffic control system. easyJet's investment...

  • Page 86
    ... based on prevailing market rates of interest. Carrying value is not significantly different from fair value. Restricted cash comprises: 2011 £ million 2010 £ million Customer payments for packaged holidays Pledged as collateral to third parties: Payment card acquiring Aircraft operating lease...

  • Page 87
    85 Overview easyJet plc Annual report and accounts 2011 Business review 14 Borrowings At 30 September 2011 Current £ million Non-current £ million Total £ million Bank loans Finance lease obligations 146 9 155 Current £ million 933 212 1,145 Non-current £ million 1,079 221 1,300 Total ...

  • Page 88
    86 easyJet plc Annual report and accounts 2011 Notes to the accounts Continued 17 Share capital Number 2011 million 2010 million 2011 £ million Value 2010 £ million Authorised At beginning and end of the year; ordinary shares of 25p each Allotted, called up and fully paid At 1 October Issued ...

  • Page 89
    ... performance conditions based on growth in earnings per share. All options expire ten years after grant. Long Term Incentive Plan The plan is open, by invitation, to Executive Directors and senior management, and provides for annual awards of performance shares worth up to 200% of salary each year...

  • Page 90
    88 easyJet plc Annual report and accounts 2011 Notes to the accounts Continued 18 Share incentive schemes continued The fair value of grants under the discretionary and sharesave is estimated by applying the Binomial Lattice option pricing model using the following key assumptions. The fair value ...

  • Page 91
    89 Overview easyJet plc Annual report and accounts 2011 Business review 19 Reconciliation of operating profit to cash generated from operations 2011 £ million 2010 £ million Operating profit Adjustments for non-cash items: Depreciation Loss on disposal of property, plant and equipment Loss on...

  • Page 92
    90 easyJet plc Annual report and accounts 2011 Notes to the accounts Continued 21 Financial instruments Carrying value and fair value of financial assets and liabilities The fair values of financial assets and liabilities, together with the carrying value at each reporting date are as follows: ...

  • Page 93
    ... period in which the hedged item affects the income statement. easyJet uses forward contracts to hedge US dollar transaction currency risk (comprising fuel, leasing and maintenance payments), jet fuel price risk and euro and Swiss franc revenues. Where these hedges are assessed as highly effective...

  • Page 94
    ...easyJet plc Annual report and accounts 2011 Notes to the accounts Continued 21 Financial instruments continued The cumulative net gains / (losses) deferred in shareholders' equity and their expected maturities are as follows: At 30 September 2011 Within 1 year £ million 1-2 years £ million Total...

  • Page 95
    ...totalling $278 million was put in place all of which was utilised during the year. The principal measure used by easyJet to manage capital risk is the gearing ratio of debt (defined as debt plus seven times aircraft operating lease payments less cash, including money market deposits) to shareholders...

  • Page 96
    ... profile has been calculated based on spot rates for the US dollar, euro, Swiss franc and jet fuel at close of business on 30 September each year. Credit risk management easyJet is exposed to credit risk arising from cash and money market deposits, derivative financial instruments and trade and...

  • Page 97
    95 Overview easyJet plc Annual report and accounts 2011 Business review Fuel price risk management easyJet is exposed to fuel price risk. The objective of the fuel price risk management policy is to provide protection against sudden and significant increases in jet fuel prices, thus mitigating ...

  • Page 98
    ... plc Annual report and accounts 2011 Notes to the accounts Continued 23 Leasing commitments Commitments under operating leases Aircraft 2011 £ million 2010 £ million 2011 £ million Other 2010 £ million Total commitments under non-cancellable operating leases due: Not later than one year...

  • Page 99
    ... easyJet plc Annual report and accounts 2011 Business review 26 Related party transactions On 11 October 2010, easyJet announced that it had reached an agreement on its dispute with easyGroup IP Licensing Ltd ("easyGroup") and Sir Stelios Haji-Ioannou over the terms and operation of the easyJet...

  • Page 100
    98 easyJet plc Annual report and accounts 2011 Company statement of financial position 30 September 30 September 2010 2011 £ million £ million Notes Non-current assets Investments in subsidiary undertakings Current assets Amounts due from subsidiary undertakings Current liabilities Amounts due ...

  • Page 101
    99 Overview Company statement of changes in equity easyJet plc Annual report and accounts 2011 Business review Share capital £ million Share premium £ million Retained earnings £ million Total £ million At 1 October 2010 Total comprehensive income Profit for the year Share incentive ...

  • Page 102
    100 easyJet plc Annual report and accounts 2011 Company statement of cash flows Year ended Year ended 30 September 30 September 2011 2010 Notes £ million £ million Cash flows from operating activities Cash (used by) / generated from operations Interest received Dividends received Net cash (used...

  • Page 103
    ... easyJet plc Annual report and accounts 2011 Business review a) Income statement and statement of total comprehensive income In accordance with Section 408 of the Companies Act 2006, the Company is exempt from the requirement to present its own income statement. The Company's profit for the year...

  • Page 104
    ... easyJet plc Annual report and accounts 2011 Notes to the Company accounts Continued c) Reconciliation of operating profit to cash generated from operations 2011 £ million 2010 £ million Operating profit Adjustments for non-cash items: Unrealised foreign exchange differences Changes in working...

  • Page 105
    ... easyJet plc Annual report and accounts 2011 Business review 2011 £ million 2010 £ million 2009 £ million 2008 £ million 2007 £ million Income statement Revenue EBITDAR Group operating profit (EBIT) Profit before tax Profit for the year Profit before tax (underlying) Earnings per share...

  • Page 106
    ... and seats provided to staff for business travel. Profit before tax per seat Profit before tax divided by seats flown. Aircraft owned / leased at end of year Number of aircraft owned or on lease arrangements of over one month's duration at the end of the period. Return on capital employed (ROCE...

  • Page 107
    ..., Carolyn McCall OBE, Nicola McGarry, Shuhall Miah, Paul Moore, Reg Otten, Chris Paull, Giles Pemberton, Sir Michael Rake, Tom Smethers, Andrew Tempest, Helen Whittle and all of our employees across the network. This annual report is printed on Amadeus 100 Silk paper and board, produced using 100...

  • Page 108
    www.easyJet.com Hangar 89 London Luton Airport Luton Bedfordshire LU2 9PF