EasyJet 2011 Annual Report Download - page 5

03
easyJet plc
Annual report
and accounts 2011
Overview Business review Performance and risk Corporate responsibility Governance Accounts & other information
I am pleased to report that your Company has
delivered a good financial performance this year
andthe business has strengthened.
Progress this year
In its first full year in charge the management team
hasmade excellent progress inimplementing the
strategy laid out in last year’s annual report and driving
improvement in processes and capability.
As a result both unit revenues andcosts have improved
to drive a substantial improvement in profitability and
returns.
We have refreshed the Board with the appointments
ofCharles Gurassa as Deputy Chairman and Senior
Independent Director, Andy Martin and Adele Anderson
and strengthened the Board’s capabilities in the areas
of aviation, and risk and financial management.
Returns to shareholders
The Board is committed to delivering returns in excess
of the cost of capital and returning excess capital to
shareholders. In the past year, earnings per share has
increased by 24.1 pence to 52.5 pence and Return on
Capital Employed improved by 3.9 percentage points
to 12.7%.
The weak consumer environment with rising fuel costs
and taxation will continue to present challenges for the
aviation industry. We have proactively put in place
actions to ensure the business navigates a difficult
environment by maintaining a strong balance sheet
and by curtailing growth over winter 2012 and 2013.
This combined with our strong network and focus on
improving revenues and cost control means that
Chairman’s introduction
Sir Michael Rake
Non Executive Chairman
easyJet is well placed and the Board is confident in
confirming our first ever dividend of £45 million for
financial year 2011 and a special dividend of £150 million.
Industry regulation
It is important that our industry ensures that we play
our part in tackling climate change. However, if this is
done through only constraining demand the economic
and social benefits of travel will be put at risk. In the UK
alone aviation contributes £11 billion to GDP.
Environmental measures must deliver real gains in
environmental efficiency and cannot be used as a way
to simply tax passengers. easyJet continues to support
aviations’ entry to EU ETS, however we are disappointed
by the UK Government’s proposal to increase the tax on
short-haul travel and reduce it for long-haul travel. This
proposal will reduce growth and jobs, as the majority of
the UK’s tourists come from Europe, and it will increase
emissions, as long-haul flights are responsible for much
greater emissions than short-haul flights.
We are also concerned about the apparent lack of
Government commitment to expanding runway
capacity in the South East. This will have negative
consequences for the London and wider UK economy
and easyJet supports projects, such as a second
runway at Gatwick, the most congested runway
inEurope.
Finally, we call for the end of inconsistent application
ofconsumer rules across Europe. We are proud of
ourcommitment to ensuring our passengers receive
the support they deserve if they are disrupted, and
thatourwebsite provides clear and transparent
information on fares. easyJet led the way in Europe in
providing passengers with simple fares. However, we
have seen regulators across Europe applying the rules
in different ways, and making inconsistent demands on
us and so we are campaigning to ensure there is a level
playing field across Europe.
Conclusion
Finally I would like to thank all of easyJet’s people for
their efforts in the past year, their commitment and
enthusiasm is core to easyJet’s success.
Sir Michael Rake
Non Executive Chairman