EasyJet 2013 Annual Report Download - page 127

www.easyJet.com
$FFRXQWVRWKHULQIRUPDWLRQ
 *HRJUDSKLFDOUHYHQXHDQDO\VLV

PLOOLRQ
2012
£ million
United Kingdom  1,761
Southern Europe  1,310
Northern Europe  738
Other  45
 3,854
Southern Europe comprises countries lying wholly or mainly south of the border between Italy and Switzerland, plus France.
easyJet’s non-current assets principally comprise its fleet of 134 owned and 11 finance leased aircraft. A further 72 aircraft
are held under operating leases, giving a total fleet of 217 at 30 September 2013. All of these aircraft are registered in the
United Kingdom except for 22 registered in Switzerland. These assets are used flexibly across the entire route network,
and accordingly there is no suitable basis for allocating them to geographic segments.
 5HODWHGSDUW\WUDQVDFWLRQV
The Company licences the easyJet brand from easyGroup IP Licensing Limited (‘easyGroup’), a wholly owned subsidiary
of easyGroup Holdings Limited, an entity which easyJet’s founder, Sir Stelios Haji-Ioannou, holds a beneficial interest and
holds 25.91% of the issued share capital of the Company.
Under the Amended Brand Licence signed in October 2010, an annual royalty of 0.25% of total revenue is payable for
a minimum term of ten years. The full term of agreement is 50 years.
A new brand protection protocol was also agreed, under which easyJet will contribute up to £1 million per annum to
meet the costs to protect the ‘easy’ and ‘easyJet’ brands and easyGroup will contribute £100,000 per annum. Beyond
the first £1.1 million of costs, easyJet can commit up to an aggregate £5.5 million annually to meet brand protection
costs, with easyGroup continuing to meet its share of costs on a 10:1 ratio. easyJet must meet 100% of any brand
protection costs it wishes to incur above this limit.
A separate agreement has been entered with Sir Stelios (‘the Comfort Letter’), dated 9 October 2010, under which,
in return for certain non-compete obligations, easyJet makes payment of a fee of £300,000, adjusted annually per the
UK Retail Price index, each year for five years (or until the expiry of the longest subsisting restriction, whichever is later).
Whilst certain of those obligations have since expired, remaining in force are the following:
For three years from the date of the Comfort Letter, to not sell the easyJet brand or the shares in easyGroup IP Holdings
Limited to any airline licensed in any EEA country, or Switzerland, or the owner or indirect owner of such airline.
For five years from the date of the Comfort Letter, Sir Stelios shall not use his own name (or a derivative thereof)
to brand an airline flying to or from any EEA country, or Switzerland.
The Amended Brand Licence and Comfort Letter were approved by the shareholders at a general meeting held on
10 December 2010. The amounts included in the income statement for the year ended 30 September 2013 for these
items were as follows:

PLOOLRQ
2012
£ million
Annual royalty  5.0
Brand protection (legal fees paid through easyGroup to third parties)  1.2
Agreement with Sir Stelios Haji-Ioannou  0.3
 6.5
For the year ended 30 September 2013, the annual royalty is based on 0.25% of total revenue. In the prior year, the
royalty was based on a fixed fee as per the Amended Brand Licence.
At 30 September 2013, £1.1 million (2012: £0.2 million) of the above aggregate amount was included in trade and other payables.
125
www.easyJet.com
Accounts & other information