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REG - easyJet PLC - Half-year Report

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RNS Number : 0279M  easyJet PLC  19 May 2022

 

19 May 2022

easyJet plc

Results for the six months ending 31 March 2022

 

easyJet faces summer 2022 with optimism - with customers returning strongly to
us whilst also driving a step-changed revenue capability, we expect to deliver
attractive continued improvement

-      Headline loss before tax of £545 million (Reported loss before
tax of £557 million)

-      Radical network optimisation: >1.5m seats reallocated to
strongest markets

-      Step-changed ancillary products delivering incremental revenue

-      H2 operating CASK(7) ex fuel expected to be close to FY19 levels

-      Higher fuel and USD exchange rates layering additional cost in H2

 

Commenting on the results, Johan Lundgren, easyJet Chief Executive said:

"easyJet has reduced its losses year on year, at the better end of guidance.
The pent-up demand and removal of travel restrictions provided for a strong
and sustained recovery in trading which has been further boosted as result of
our actions. These include the radical reallocation of aircraft which has seen
more than 1.5m seats moved to the best performing markets and the step-change
in our ancillary products delivering increased revenue - both of which have
contributed to our total yield increasing by 9% compared to the same period in
FY19. All of this is not only delivering now but with more to come in the
future as even more passengers take to the skies.

"We have transformed the airline during the pandemic which has enabled us to
emerge with renewed strength, underpinned by a product, network and service
that customers really value.

"Since Easter we have been flying up to a quarter of a million customers and
1600 flights every day and in the second half leisure and domestic capacity
will be above 2019 levels. It has been well documented that the industry is
experiencing some operational issues so, as you would expect, we have been
absolutely focused on taking action to ensure we have strengthened our
operational resilience for this summer so we can deliver a great, reliable
operation to our customers.

"We expect to operate 90% of FY19 capacity in Q3 and we have capacity on sale
of around 97% of FY19 flying in Q4 with easyJet holidays now on track to carry
over 1.1 million customers this financial year.

"And so, as we return to a more normal summer season, we are ready to capture
the increased levels of demand right across our network. We are confident in
our plans for summer which will see us reaching near 2019 flying levels and
look forward to competing with our renewed strengths as a winner in the post
pandemic recovery of European aviation."

Overview

easyJet has continued to allocate aircraft to the markets where we see demand
at its strongest. In the second half of the year leisure and domestic routes
have fully recovered with capacity at 113% and 104% of FY19 levels
respectively, whilst business and city traffic continues to recover with
demand currently below FY19 levels. Additionally, the steps we have taken to
transform our ancillary offering are delivering significant levels of
incremental revenue generation without cannibalising our ticket revenue.

The airline industry has recently been experiencing operational pressures,
which mainly impacted easyJet through early April. easyJet has taken action to
address these pressures, which includes; proactively managing the schedule,
reducing cancellations through various measures such as, boosting recruitment,
and improving ID processing. Despite this, bookings continue to be strong as
we have seen demand, post the impact of the Omicron variant, returning with
the removal of travel restrictions. Booking patterns have remained shorter
than they were pre pandemic, however in the last 10 weeks bookings have
consistently been above the levels in the same period of 2019. easyJet
holidays is continuing to build, as the UK's fastest growing holiday company
and remains on track to carry >1.1 million passengers in FY22 with over 70%
of the program sold.

Summer 22:

·     Forward bookings for the third quarter are 76% sold and 36% sold
for the fourth quarter.

·     In the last 10 weeks, bookings have been 6% above the same period
in 2019

·     Easter holidays saw load factors of 90%

·     Q4 Sold ticket yields are currently 15% above 2019 and load factors
expected to be >90%

·     Capacity recovery:

o  H2 Leisure capacity at 113% of FY19

o  H2 Domestic capacity at 104% of FY19

·     Holidays >70% sold and on track to deliver medium term target of
£100m+ PBT

Capacity:

·     Q3 Capacity expected to be c.90% of FY19

·     Q4 Capacity on sale is c.97% of FY19

Hedging

·     easyJet is currently c.71% hedged for fuel in H2 of FY22 at
c.US$619 per metric tonne, c.49% hedged for H1 FY23 at c.US$701 and c.20%
hedged for H2 FY23 at c.US$807. The spot price on 17 May 2022 was around
US$1,225.

·     Carbon obligation for CY'22 100% covered at €19/MT

 

Financial Summary

·     Headline loss before tax of £545 million (H1 2021: £701 million
loss)

o  Total revenue increased by 524% to £1,498 million (H1 2021: £240
million) predominantly due to the increase in capacity flown and ancillary
products continuing to deliver incremental revenue.

o  Group headline costs increased by 117% to £2,043 million (H1 2021: £941
million), primarily due to the increase in flown capacity.

·     Reported loss before tax of £557 million (H1 2021: £645 million
loss).

o  Non-headline loss of £12 million (H1 2021: £56 million gain).
Non-headline items consist of losses from the sale and leaseback of aircraft
partially offset by restructuring provision releases.

  ( )                                                                H1 2022  H1 2021        Change

                                                                                        favourable/(adverse)
 Capacity(1) (millions of seats)                                     30.3     6.4                    373.4%
 Passengers(3) (millions)                                            23.4     4.1                    470.7%
 Load factor(2) (%)                                                  77.3     63.7                   13.6ppts
 Average sector length (km)                                          1,131    1,261                  (10.3%)
 Total revenue (£ million)                                           1,498    240                    524.2%
 Headline EBITDAR (£ million)                                        (208)    (469)                  55.7%
 Headline loss before tax (£ million)                                (545)    (701)                  22.3%
 Reported loss before tax (£ million)                                (557)    (645)                  13.6%
 Airline revenue per seat (£)                                        47.61    36.93                  28.9%
 Airline revenue per seat at constant currency(4) (£)                49.06    36.93                  32.8%
 Airline EBITDAR cost ex fuel per seat (£)                           (42.45)  (94.09)                54.9%
 Airline EBITDAR cost ex fuel per seat at constant currency(4) (£)   (43.58)  (94.09)                53.7%
 Airline headline loss before tax per seat                           (17.80)  (108.07)               83.5%
 Holidays contribution                                               (5.5)    (8.1)                  32.1%
 Headline EBITDAR Margin                                             (14.0%)  (195.8%)               181.8ppts
 Headline ROCE                                                       (12.0%)  (16.8%)                4.8ppts

For further details please contact easyJet plc:

 

Institutional investors and analysts:

Michael Barker                  Investor
Relations                           +44 (0)7985 890
939

 

Media:

Anna Knowles                   Corporate Communications
       +44 (0)7985 873 313

Edward Simpkins              Finsbury
 
+44 (0)7947 740 551 / (0)207 251 3801

Dorothy Burwell               Finsbury
 
+44 (0)7733 294 930 / (0)207 251 3801

 

Conference call

There will be an analyst presentation at 09:00am GMT on 19 May 2022 at Nomura,
One Angel Lane, London, EC4R 3AB.

 

Alternatively, a webcast of the presentation will be available both live and
for replay (please register on the following link):
https://stream.brrmedia.co.uk/broadcast/6274ee558eb4f178d1ef92ad
(https://stream.brrmedia.co.uk/broadcast/6274ee558eb4f178d1ef92ad)

Alternatively dial in details are as follows: 0800 279 6877/+44 (0)330 165
4012

 

Revenue

Total revenue increased by 524.2% to £1,498 million (H1 2021: £240 million)
in line with capacity increasing to 30.3 million seats (H1 2021: 6.4 million)
because of pandemic-related travel restrictions being more relaxed than they
were in the same six months last year.

Passenger revenue increased by 479.4% to £985 million (H1 2021: £170
million) as we flew increased levels of capacity compared to the same period
last year. Passenger RPS increased by 22.7% to £32.49 (H1 2021: £26.47) due
to demand returning as travel restrictions eased in the early part of H1 as
customers enjoyed the late summer season before a temporary pause in December
and January as a result of the Omicron variant. Trading strengthened again in
February and March as restrictions were removed.

Group ancillary revenue increased by 632.9% to £513 million (H1 2021: £70
million) as capacity increased. Airline ancillary revenue per seat also
increased by 44.6% to £15.12 (H1 2021: £10.46) as we continue to see
incremental benefits from the new ancillary products which have been launched
since H1 of FY21.

Costs

Group headline costs excluding fuel and FX gains increased by 94.2% to £1,684
million (H1 2021: £867 million), driven by an increase in capacity flown as
easyJet continues to ramp up capacity.

easyJet recorded a £2 million gain from foreign exchange (H1 2021: £24
million gain), related to the impact of stronger Sterling on our net foreign
currency-denominated liabilities.

The cost per seat performance continues to be impacted by volume. Airline
headline cost per seat at constant currency decreased by 55.0% to £66.81 (H1
2021: £148.59). Headline Airline cost per seat excluding fuel at constant
currency decreased by 59.0% to £54.71 (H1 2021: £133.51).

Non-Headline Items

Non-headline items are those where, in management's opinion, their separate
reporting provides a better understanding to users of the financial statements
of easyJet's underlying trading performance, and which are significant by
virtue of their size and/or nature.  These costs are separately disclosed and
further detail can be found in the notes to the accounts. A Group non-headline
loss before tax of £12 million (H1 2021: £56 million gain) was recognised in
the first half. The significant items consisted of a £21 million loss as a
result of the sale and leaseback of 10 aircraft and an £8m release from
restructuring provisions.

Balance Sheet

During H1 easyJet repaid £300 million of commercial paper, clearing the final
balance under the CCFF scheme. easyJet has no other debt maturities until the
2023 financial year. As at 31 March 2022 our net debt position was £0.6
billion (30 September 2021: £0.9 billion) including cash and cash equivalents
and money market deposits of c.£3.5 billion.

Strategy Update

easyJet has prioritised six strategic initiatives that will continue to build
on our structural advantages in the European aviation market and enable us to
lead the recovery as travel returns.

·    Network strategy

·    Customer excellence

·    Product portfolio evolution

·    easyJet holidays

·    Cost focus

·    Sustainability

 

These initiatives, underpinned by operational and digital safety and a
continued focus on our people, should result in strong shareholder returns
being delivered.

Network Strategy

easyJet has a strong network of leading number one and number two positions in
primary airports, which has proven to be amongst the highest yielding in the
market. This enables us to be efficient with our network choices, with an
emphasis on maximising returns.

easyJet continues to optimise its network to ensure capacity is deployed in
the markets where we see the strongest demand. This has been done this summer
through our network optimisation, where over 1.5 million seats have been
reallocated across the network. This enables us to serve our customers in the
markets where demand is the strongest.

We will seek to strengthen our position in key markets as the competitive
landscape evolves. This has been demonstrated at London Gatwick where we are
increasing our market share after reallocating aircraft to this high yielding
base along with the addition of new slots. As well as growing in Gatwick, an
extra five aircraft worth of slots have been added into the Greek Islands,
where easyJet will now be the largest carrier this summer.

Our focused network strategy can be summarised as follows:

1.    Lead in our Core Markets

easyJet prioritises slot-constrained airports as these are where customers
want to fly to and from. In our core markets, we are able to achieve cost
leadership and preserve scale.  We provide a balanced network portfolio
across domestic, city and leisure destinations. Our scale enables us to
provide market leading networks and schedules. We are maintaining our focus on
country leadership in the UK, France and Switzerland and our city focus in the
Netherlands, Italy and Germany.

2.    Accelerate investment in Destination Leaders

We will build on our existing leading positions in Western Europe's top
leisure destinations to provide network breadth and flexibility. This will
also unlock cost benefits, enabling us to manage seasonality and support the
growth of easyJet holidays. It also ensures that easyJet remains top of mind
for customers and is seen as the 'local airline' for governments and
hoteliers.

3.    Build our network in Focus Cities

easyJet is building a network of key cities, broadening our presence across
Europe. This is a low-risk way of serving large origin markets. We will base
assets in Focus Cities where it makes sense from a cost perspective.

Customer Excellence

Despite the rise in living costs, consumer research suggests there is still
strong appetite to travel due to pent up demand and people topping up savings
during the pandemic. 1 in 2 respondents in the UK say limited opportunities to
travel during the pandemic has made their holidays more important to them than
before (ABTA travel in 2022).

The continuous removal of restrictions has benefitted business travel,
specifically SMEs who were able to set the pace of recovery while large
corporates migrated to hybrid working. We have begun to see the return of
business travellers and easyJet is well placed to provide business segments
with the network, schedule, product & value to enable growth.

We launched our nextGen brand campaign, highlighting environmental and
inclusivity initiatives as well as our continued focus on delivering great
value European travel.

easyJet aims to deliver a seamless and digitally enabled customer journey at
every stage:

·    Prior to travel: our 'direct is best' strategy is led by our digital
channels, with an app/mobile-first mindset which makes travel easy for our
customers. Confirmation and check-in summary pages now dynamically display
the cabin bag allowance of a specific booking, enabling our customers to more
easily understand their specific cabin bag allowance.

·    In airport: moving customers from kerb to aircraft without the need
for human interaction. This involves improving boarding in order to improve
CSAT(8) and reduce queuing, which our cabin bag policy continues to help with.
With the easing of travel restrictions, we're returning towards pre-pandemic
policies, e.g. removing face mask requirement on-board.

·    In flight: our warm welcome and personal service to get you to your
destination on time. We are committed to delivering On-Time Performance (OTP)
- on time, every time. This is done by managing suppliers, empowering crew,
ATC planning and carrying out base operating reviews. We are also continuing
to improve our inflight offering with the launch of inflight retail.

·    Support: we aim to give customers the digital tools to easily
self-serve when things do not go to plan, or to engage after their flight. We
are continuing to look after our customers with our Self-Service Disruption
Portal (SSDP) significantly reducing customer request time when using SSDM
rather than the contact centre.

Our customer satisfaction has returned to pre-pandemic levels at 77%.

Despite the significant ramp up in activity in H1 2022, on time performance
has remained broadly in line with 2019- with performance in the prior year
driven by lower levels of capacity. This reflects the strides we are taking
towards leaving 'on time, every time'. This is crucially important for our
operational efficiency, as well as customer satisfaction.

 OTP % arrivals within 15 minutes((5))  Q1   Q2   H1
 2022 Network                           87%  86%  86%
 2021 Network                           94%  91%  94%

 

Product Portfolio Evolution

easyJet recognises that the continued evolution of our product portfolio
represents a significant opportunity to increase revenue per seat and margins
in the coming years. We are continuing to see a strong performance from the
products which have been launched recently, including cabin bags and our new
leisure fare (Essentials) bundle. In the first half of 2022 these have added
an incremental £3.14 to ancillary yields compared to the same period last
year.

The Directors believe that the continued evolution of the Group's product
portfolio provides the opportunity to build on spend per customer, delivering
enhanced sustainable returns.

At the end of the first half, inflight retail, our new retail brand &
proposition has been launched. This has resulted in direct sourcing and
contracting for our on-board retail offering and is tailoring the product
offering to our customers. We have partnered with dnata to improve our
customer proposition, as we see an opportunity to grow conversion, spend per
customer and profit per seat.

easyJet holidays

easyJet holidays continues its rapid growth to becoming a major player within
the sector, having seen over 500% increase in Summer 2022 bookings versus the
previous 2019 model, which now confirms easyJet holidays as the UK's fastest
growing holiday company.

Our holidays business is well on track to deliver over 1.1m passengers in 2022
and has already sold over 70% of that planned volume, at significantly higher
margins versus 2019 and lower acquisition costs compared to our competitors,
having 88% of the visitors to our website coming through unpaid channels, the
majority of which are from customers visiting easyjet.com.

As a digital first business we are proud to have been recognised for our
award-winning website and technology and see significant opportunity to fast
track our growth to £100m PBT in the medium term. We offer the most
competitively priced holidays in the market, being cheaper c.75% of the time
on a like for like basis versus our competitors. This coupled with our direct
hotel contracting and low fixed cost base provides easyJet holidays with a
strong business model to accelerate our growth and deliver sustainable
returns.

Cost focus

easyJet has a cost advantage over its major competitors on our primary airport
network. Actions have been taken to deliver cost savings, and as a result of
these actions, easyJet expects that its operating CASK(7) excluding fuel in
the second half of FY22 will be close to H2 2019 levels. This demonstrates the
work that has been done and is based on ASKs(9) increasing c. 2% on H2 2019.

Examples of these cost actions are;

·    Self Service disruption management, where we have reduced the need
for manual processing by 69% when dealing with customer refunds and vouchers
(since go-live Aug 2019). This is improving our customer satisfaction, but
also delivers cost savings as we are having less calls to our contact centres.

·    Crew agreements on seasonal contracts have been achieved as a result
of constructive relationships with our trade union partners and our people.
Improvements have also been made to productivity.

·    Line maintenance insourced at LGW, BER, GLA, EDI, BRS. This action is
delivering cost savings but also ensures the best quality as we carry out the
line maintenance in house.

Sustainability

Today easyJet has announced our interim science-based target following our
commitment to the initiative. This will see us reduce our carbon intensive
emissions by 35% by FY35 using FY20 as a baseline.

We plan to achieve this ambitious target through a combination of four
business actions:

·    Fleet renewal: All of the aircraft deliveries that we receive between
FY22 and FY28 will be Aircraft NEO Aircraft. These NEO aircraft offer 15-25%
more fuel efficiency and provide a 50% reduction in noise, compared to the
aircraft they will replace. This is in addition to upgauging our seat capacity
and, offering both revenue and cost benefits.

·    Operational improvements and efficiencies: We will continue to
operate our aircraft as efficiently as possible and are always looking for
efficiency improvements. This includes adjusting standard operating
procedures, which helps to reduce fuel usage and therefore carbon emissions,
for example single-engine taxiing on arrival and departure.

·    Airspace modernisation: In the immediate term, airspace modernisation
is the most achievable source of significant carbon emission reductions, as
more direct flight paths lead to shorter flying times. We are working with
stakeholders and public authorities to promote the modernisation of airspace,
including projects such as the Single European Sky which is predicted to
deliver 10% CO2 emissions savings on easyJet's network.

·    Sustainable Aviation Fuel: We will use SAF at scale in the interim in
order to achieve material lifecycle carbon emissions reductions in comparison
to kerosene.

easyJet plans to publish its net-zero pathway, where we will set out our
carbon emission reduction goals.

easyJet's sustainability strategy has evolved to reflect our ambition to
pioneer positive change for our planet, communities & people while getting
one step closer to net-zero every day. It is focussed on three pillars, and
underpinned by Governance.

·    Reducing our impact today for a better tomorrow: We achieved IATA
Environmental Assessment programme (IEnvA) stage 1 accreditation, for an
ISO14001-compliant Environmental Management System (EMS). This makes us the
only Low-Cost Carrier operating in the UK with an IEnvA Stage 1 verified EMS
and the first non-IATA member to participate in the IEnvA accreditation
process.

·    Pioneering future travel: Our partnerships with various industry
leaders work towards the acceleration of zero carbon emission technologies and
the required infrastructures for these to be present in the aviation industry.
Our partnerships include, amongst others, GKN Aerospace and Cranfield
Aerospace Solutions where we are supporting projects focusing on hydrogen
combustion and fuel cell technology, and the development of a hydrogen fuel
cell propulsion system. We are championing zero emission flying through the
development of a zero emissions aircraft to decarbonise aviation.

·    Driving positive change in society: We are working to positively
impact our people, customers, and communities with the aim of maximising the
positive social and economic benefits of travel and tourism. This has included
launching an onboard appeal in support of our charity partner UNICEF to help
children and their families affected by the conflict in Ukraine.

Our sustainability strategy is underpinned by strong sustainability governance
and monitoring at board level to make sure the strategy is delivered. In
December 2021, we received a B rating from CDP(6) for 2021, an improvement on
the previous year. We have also published an ESG supplement on our website, to
be read alongside our FY21 Annual Report, giving further data and information
on ESG topics such as human capital & labour management; safety, quality
& governance; business ethics; data privacy & security, and
environmental management.

Fleet

easyJet's total fleet as at 31 March 2022 comprised 322 aircraft (30 September
2021: 308 aircraft with 12 held on zero rent basis) with the increase driven
principally by the cessation of free rental period aircraft, delivery of 5 new
A320 family aircraft, and lease additions to the fleet. The average gauge of
the fleet is now 179 seats per aircraft, compared to 178 seats at 30 September
2021. The average age of the fleet increased slightly to 8.9 years (30
September 2021: 8.6 years).

Fleet as at 31 March 2022:

                            Owned  Leased  Total  % of fleet  Changes since Sep-21  Future deliveries  Purchase options  Purchase rights

 A319                       35     64      99     31%         2                     -                  -                 -
 A320                       105    62      167    51%         7                     -                  -                 -
 A320 neo                   34     7       41     13%         4                     100(1)             6(1)              53(1)
 A321 neo                   4      11      15     5%          1                     15(1)              -                 -
                            178    144     322                14                    115                6                 53
 Percentage of total fleet  55%    45%

1)    easyJet retains the option to alter the aircraft type of future
deliveries, subject to providing sufficient notification to the OEM

At 31 March 2022, easyJet was storing two operating leased aircraft on behalf
of their respective lessors. These are held at zero rent unless flown and are
excluded from the fleet plan. Additionally, easyJet is storing 2 further
operating leased aircraft, which have been acquired for future operations.
These are held at zero rent and are excluded from the fleet plan.

Our flexible fleet plan allows us to expand or contract the size of the fleet
depending upon the demand outlook.

 Number of aircraft               FY22  FY23  FY24  FY25
 Current contractual minimum      -     323   306   276
 Base plan                        324   -     -     -
 Current contractual maximum      -     332   327   337
 Expected deliveries              9     6     18    26

 

Capital Expenditure

Over the next three years easyJet's gross capital expenditure is expected to
be as follows:

                                         FY22   FY23     FY24     FY25
 Gross capital expenditure (£ million)   c.800  c.1,000  c.1,300  c. 1,800

 

Capex in FY22 is comprised of new Airbus fleet delivery payments and
maintenance related expenditure as well as lease payments. Our capex
projections assume nine aircraft deliveries in FY22, six deliveries in FY23,
18 deliveries in FY24 and 26 deliveries in FY25.

Our People

easyJet continues to have a strong reputation as an employer of choice. Our
people are a key source of differentiation compared to our competition, this
helps deliver excellent customer experience and loyalty.

Our Glassdoor rating of employee satisfaction is 4.3 (out of 5.0), this is the
highest within the travel and hospitality sector, illustrating our
market-leading position in the labour market.

We have constructively worked in partnership with our employee representative
bodies across Europe in order to support the operation. We recognise that the
wider economic environment of rising inflation has been challenging for a
number of our people and continue to work with our Trade Union partners in
order to support our crew whilst maintaining control of our cost base.

In FY22 some of the key deliverables include:

·    Learning and development: We have introduced a new People Management
development programme to help develop our Manager and leader capabilities
throughout all First Line Leaders, while continuing to develop our approach to
early careers including the re-launch of our engineering apprenticeships. In
addition, we have also utilised our Apprenticeship levy to support a range of
head office roles.

·    Health and Wellbeing: We have implemented a new UK occupational
health provision and mobile enabled support for all employees while also
delivering comprehensive mental health awareness training for all employees
and managers

·    Diversity and inclusion: Implementation of a new Equal Opportunities
and Inclusion Policy.

EU Ownership

As previously announced, easyJet has suspended voting rights in respect of
certain shares ('Affected Shares') held by Relevant Persons in accordance with
easyJet's articles of association (the 'Articles') so that a majority of the
voting rights in easyJet are held by EU Persons. As at 18 May 2022, a majority
of the voting rights in easyJet are held by EU persons.

Note: 'EU persons' refers to nationals of EU member states plus Switzerland,
Norway, Iceland, Liechtenstein, but excludes the UK. 'Relevant Persons' has
the meaning given to it in the Articles.  In general terms, 'Relevant
Persons' refers to non-EU nationals. Further information is available on the
Company's website at
https://corporate.easyjet.com/investors/shareholder-services/eu-share-ownership
(https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fcorporate.easyjet.com%2Finvestors%2Fshareholder-services%2Feu-share-ownership&data=05%7C01%7CDaniel.Collison%40easyJet.com%7C4d0b35dbaf894498009e08da38aa3b2f%7C39d6d41dc7ca4a42ae3b0fba82be994b%7C0%7C0%7C637884601026842078%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&sdata=2q05e6PvHl%2BgxDV0srRu%2FCyOY7F3ly2637B557%2BBJNI%3D&reserved=0)
.

Outlook

Q3 Capacity expected to be c.90% of FY19 with load factors expected to be
>86%.

Q4 Capacity currently on sale is c.97% of FY19 with load factors expected to
be >90%.

easyJet is currently c.71% hedged for fuel in H2 of FY22 at c.US$619 per
metric tonne, c.49% hedged for H1 FY23 at c.US$701 and c.20% hedged for H2
FY23 at c.US$807. The spot price on 17 May 2022 was around US$1,225.

The targets easyJet has set are: Grow to pre pandemic capacity by 2023; mid
teen EBITDAR margins with low to mid teen ROCE in the medium term; and having
a clear roadmap for easyJet holidays to contribute £100 million plus profit
before tax to the Group.

At this stage, given the continued level of short-term uncertainty, it would
not be appropriate to provide any further financial guidance for the 2022
financial year. Customers are booking closer to departure and visibility
remains limited.

 

Footnotes

(1) Capacity based on actual number of seats flown.

(2) Represents the number of passengers as a proportion of the number of seats
available for passengers. No weighting of the load factor is carried out to
recognise the effect of varying flight (or "sector") lengths.

(3) Represents the number of earned seats flown. Earned seats include seats
which are flown whether or not the passenger turns up, as easyJet is a
no-refund airline and once a flight has departed, a no-show customer is
generally not entitled to change flights or seek a refund. Earned seats also
include seats provided for promotional purposes and to staff for business
travel.

(4) Constant currency is calculated by comparing 2022 financial year
performance translated at the 2021 financial year effective exchange rate to
the 2021 financial year reported performance, excluding foreign exchange gains
and losses on balance sheet revaluations.

(5) On-time performance is defined as the percentage of flights which arrive
within 15 minutes of the scheduled arrival time and is measured by internal
easyJet systems

(6) CDP - Carbon Disclosure Project is an independent, non-profit, global
environmental reporting organisation.

(7) Operating CASK ex fuel is our headline cost ex ownership, fuel, and
balance sheet revaluations @ constant currency per available seat kilometre

(8) CSAT is a metric of customer satisfaction based on easyJet surveys

(9) Available seat kilometres; taken by multiplying available seats on any
given aircraft by the number of kilometres flown on a given fli

 

OUR FINANCIAL RESULTS

Headline loss before tax decreased from £701 million for the six months ended
31 March 2021 to £545 million for the six months ended 31 March 2022. This
was mainly driven by the reduction in Covid-19 related travel restrictions
across Europe which has increased customer confidence to travel again; easyJet
flew 23.4 million passengers (H1 2021: 4.1 million), up 471% on the prior
period. Similarly, total loss after tax decreased from £549 million for the
six months ended 31 March 2021 to £431 million for the six months ended 31
March 2022.

Amounts presented at constant currency throughout this section are an
alternative performance measure and are not determined in accordance with
International Financial Reporting Standards, but provide relevant and
comparative reporting for readers of these financial statements.

FINANCIAL OVERVIEW

 £ million (Reported) ─ Group                                       H1 2022      H1 2021
 Group revenue                                                      1,498        240
 Headline costs excluding fuel, balance sheet FX and ownership      (1,344)      (612)
 Fuel                                                               (362)        (97)
 Headline EBITDAR                                                   (208)        (469)
 Balance sheet foreign exchange gain                                2            24
 Other ownership cost                                               (339)        (256)
 Group headline loss before tax                                     (545)        (701)
 Being:
 Airline headline loss before tax                                   (540)        (693)
 Holidays headline loss before tax                                  (5)          (8)
 Headline tax credit                                                123          126
 Group headline loss after tax                                      (422)        (575)
 Non-headline items                                                 (12)         56
 Non-headline tax credit/(charge)                                   3            (30)
 Group total loss after tax                                         (431)        (549)

 £ per seat ─ Airline only ((1))                                    H1 2022      H1 2021
 Airline revenue                                                    47.61        36.93
 Headline costs excluding fuel, balance sheet FX and ownership      (42.45)      (94.09)
 Fuel                                                               (11.94)      (15.08)
 Headline EBITDAR                                                   (6.78)       (72.24)
 Balance sheet foreign exchange gain                                0.09         3.59
 Other ownership cost                                               (11.11)      (39.42)
 Airline headline loss before tax                                   (17.80)      (108.07)
 Headline tax credit                                                3.94         19.68
 Airline headline loss after tax                                    (13.86)      (88.39)
 Non-headline items                                                 (0.40)       8.77
 Non-headline tax credit/(charge)                                   0.10         (4.61)
 Airline total loss after tax                                       (14.16)      (84.23)

 (1) All per seat metrics are for the Airline business only, as the inclusion
 of hotel-related revenue and costs from the holidays business will distort the
 RPS and CPS metrics as these are not directly correlated to the seats flown by
 the Airline. Our easyJet holidays business forms a separate operating segment
 to the Airline, but its overall contribution to the financial performance of
 the consolidated Group for the six months ended 31 March 2022 is not
 significant.

 

The total number of passengers carried increased by 471% to 23.4 million (H1
2021: 4.1 million), which was driven by a 373% increase in seats flown to 30.3
million seats (H1 2021: 6.4 million seats) and a 13.6 percentage point
increase in load factor to 77.3% (H1 2021: 63.7%). This reflects the reduction
in travel restrictions across Europe over the period and the associated
strengthening in customer demand as the recovery from Covid-19 continues.

Total revenue increased by 524% to £1,498 million (H1 2021: £240 million)
and by 544% at constant currency. Airline revenue per seat increased by 29% to
£47.61 (H1 2021: £36.93) and increased by 33% at constant currency. The
increase in Airline revenue per seat is a consequence of increased loads,
reflecting the continued strengthening in demand driven by the reduction in
travel restrictions across Europe, as noted above. In addition, strong
performance from both bag and seat initiatives drove an Airline ancillary
revenue per seat increase of 44.6% compared to H1 2021.

Headline Airline cost per seat excluding fuel decreased by 59% to £53.48 (H1
2021: £129.92) and 58% at constant currency. This was mainly a result of
increased flying, as fixed operating costs are being spread across more flying
capacity, combined with easyJet's continued focus on cost which has also
contributed to the favourable movement. In addition, there was a release of
airport charge accruals of £10 million (H1 2021: £4 million) as the return
of activity has reduced some of the uncertainty and risks which were
previously being accrued for, and a credit from maintenance discounting of
£19 million (H1 2021: credit £22 million) due to the recent increase in US$
interest rates. The major adverse impact on costs in the period was the
significant reduction in furlough schemes as government support has been wound
down across the majority of European countries (£8 million support H1 2022
compared to £73 million support H1 2021).

Airline fuel cost per seat decreased by 21% to £11.94 (H1 2021: £15.08) and
by 20% at constant currency, as a result of both a reduction in the post hedge
fuel price and a reduction in the average sector length compared to the
previous period.

A non-headline charge of £12 million (H1 2021: £56 million gain) was
recognised in the period, consisting of a £21 million loss as a result of the
sale and leaseback of 10 aircraft (H1 2021: £60 million gain from 35
aircraft) in the period and an £8 million release (H1 2021: £25 million
release) in relation to our restructuring provisions. In addition to this, a
£1 million net fair value adjustment credit for hedge discontinuation was
recognised in the period (H1 2021: £29 million charge).

Corporate tax has been recognised at a statutory effective rate of 22.7% (H1
2021: 14.9%) based on the anticipated tax rate for the full year ending 30
September 2022, resulting in an overall tax credit of £126 million (H1 2021:
£96 million credit) during the period. This splits into a tax credit of £123
million on the underlying losses and a tax credit of £3 million on the
non-headline items. Whilst the non-headline loss is £12 million, after the
necessary tax adjustments the tax adjusted non-headline items amount to a loss
of £14 million, which results in the non-headline tax credit of £3 million
for the period.

Loss per share

                                  H1 2022              H1 2021            Change
                                                       restated
                                  pence per share      pence per share    pence per share

 Basic headline loss per share    (56.0)               (106.9)            50.9
 Basic total loss per share       (57.2)               (102.0)            44.8

 

Basic headline loss per share decreased by 50.9 pence and basic total loss per
share decreased by 44.8 pence as a consequence of the lower loss generated
during the period.

As a result of the rights issue in September 2021, the comparative loss per
share has been restated having applied the relevant bonus factor to the
calculator of the weighted average number of shares.

Return on Capital Employed (ROCE)

 ROCE Calculation

 Reported £m                                               H1 2022      H1 2021
 Headline loss before interest and tax                     (486)        (686)
 UK corporation tax rate                                   19%          19%
 Normalised headline operating loss after tax (NOPAT)      (394)        (556)

 Average shareholders' equity                              2,540        1,741
 Average net debt                                          753          1,570
 Average adjusted capital employed                         3,293        3,311

 Headline Return on capital employed                       (12.0%)      (16.8%)
 Total Return on capital employed                          (12.3%)      (14.7%)

ROCE is calculated by taking operating loss/profit, less tax at the prevailing
UK corporation tax rate at the end of the period, divided by average capital
employed. Capital employed is shareholders' equity plus net debt.

Headline ROCE for the period was (12.0)%, an improvement of 4.8 percentage
points on the prior period, driven by the decrease in the loss for the period.
Total ROCE for the period was (12.3)%, an improvement of 2.4 percentage points
on the prior year. The total ROCE was adverse to the headline ROCE due to
non-headline items generating a £12m charge in the income statement, as noted
earlier.

SUMMARY NET DEBT RECONCILIATION

The table presents cash flows on a net cash basis. This presentation is
different to the GAAP presentation of the statement of cash flows in the
condensed financial information as it includes non-cash movements on debt
facilities.

                                                      H1 2022         H1 2021       Change
                                                      £ million       £ million     £ million
 Operating loss                                       (499)           (601)         102
 Depreciation and amortisation                        277             215           62
 Increase in unearned revenue                         934             48            886
 Other net working capital movement                   (157)           (731)         574
 Net tax paid                                         1               (5)           6
 Net capital expenditure                              (247)           (73)          (174)
 Net proceeds from sale and leaseback of aircraft     87              810           (723)
 Purchase of own shares for employee share schemes    (4)             (3)           (1)
 Repayment of capital element of leases               (92)            (174)         82
 Foreign exchange impact                              21              (114)         135
 Net funding activities                               97              (148)         245
 Other                                                (104)           (114)         10
 Net decrease/(increase) in net debt                  314             (890)         1,205
 Net debt at the beginning of the period              (910)           (1,125)       215
 Net debt at the end of the period                    (596)           (2,015)       1,419

Net debt as at 31 March 2022 was £596 million (31 March 2021: £2,015
million) and comprised cash and cash equivalents and money market deposits of
£3,505 million (31 March 2021: £2,335 million), borrowings of £3,046
million (31 March 2021: £3,323 million) and lease liabilities of £1,055
million (31 March 2021: £1,027 million).

The unearned revenue inflow has increased by £886 million, as a result of the
increased customer bookings in response to the removal of Covid-19 travel
restrictions. Other working capital outflows have decreased by £574 million
compared to the prior period. The prior period saw an unusually large decrease
in the trade payables balance as a catch-up effect from the initial lockdown
period, when many supplier accounts were put onto phased payment plans as part
of our cash protection measures. This year has seen a return to more normal
payment patterns.

Net capital expenditure includes pre-delivery payments relating to aircraft
purchases. There were also final delivery payments for the acquisition of 5
aircraft in the period (H1 2021: nil aircraft). The sale and leaseback of 10
aircraft in H1 2022 (H1 2021: 35 aircraft) resulted in a net cash inflow of
£87 million (H1 2021: £810 million). Repayment of the capital element of
leases has decreased by £82 million as a result of the prior period having
additional deferred payments from H2 2020 included. The net funding activities
predominantly relate to the final £91 million rights issue receipt.

EXCHANGE RATES

The proportion of revenue and costs denominated in currencies other than
Sterling are outlined below:

                                    Revenue             Costs
                                    H1 2022  H1 2021    H1 2022   H1 2021
 Sterling                           45%      30%        37%       67%
 Euro                               45%      54%        24%       5%
 US dollar                          0%       0%         33%       22%
 Other (principally Swiss franc)    10%      16%        6%        6%

 Average exchange rates                                 H1 2022   H1 2021
 Euro                                                   €1.19     €1.10
 US dollar                                              $1.35     $1.30
 Swiss franc                                            CHF 1.24  CHF 1.33

The Group's foreign currency risk management policy aims to reduce the impact
of fluctuations in exchange rates on future cash flows.

During the period there was a £2 million gain (H1 2021: £24 million gain)
arising from the revaluation of balance sheet assets and liabilities which are
denominated in foreign currencies. In addition, the change in USD decreased
the cost of fuel by £4 million when translated into sterling.

FINANCIAL PERFORMANCE

Revenue

 £m Group                 H1 2022      H1 2021
 Passenger revenue        985          170

 Ancillary revenue        513          70
 Total revenue            1,498        240

 £ Airline per seat
 Passenger revenue        32.49        26.47
 Ancillary revenue        15.12        10.46
 Total revenue            47.61        36.93

Total revenue increased by 524% to £1,498 million (H1 2021: £240 million)
and 544% at constant currency, primarily due to an £883 million additional
capacity volume impact. H1 capacity finished at 30.3 million seats, which was
373% favourable to last year driven by the reduction in travel restrictions
and the associated strengthening of customer demand.

Total Airline revenue per seat of £47.61 was 33% ahead of H1 2021 at constant
currency and load factors of 77% were 13.6ppt ahead. Likewise, total yield of
£61.59 was 10% favourable when compared against H1 2021 at constant currency,
with ticket yields 3% favourable and ancillary yields continuing to perform
very strongly at 23% favourable.

Ancillary revenue of £513 million was 658% ahead of H1 2021 at constant
currency. This was principally due to a good performance on initiatives with
strong attachment across both bags and seats, combined with the increase in
passenger numbers compared to H1'21.

Headline costs excluding fuel

                                                          H1 2022                        H1 2021
                                                          Group        Airline           Group        Airline

                                                          £ million    £ per seat        £ million    £ per seat
 Operating costs and income
 Airports, ground handling and other operating costs      514          15.65             86           13.14
 Crew                                                     318          10.48             224          34.87
 Navigation                                               110          3.63              25           3.84
 Maintenance                                              157          5.16              109          17.01
 Selling and marketing                                    68           2.03              17           2.54
 Other costs                                              183          5.61              158          23.72
 Other income                                             (6)          (0.11)            (7)          (1.03)
                                                          1,344        42.45             612          94.09
 Ownership costs
 Aircraft dry leasing                                     1            0.04              2            0.24
 Depreciation                                             265          8.74              204          31.80
 Amortisation                                             12           0.33              11           1.44
 Net finance charges                                      59           1.92              15           2.35
                                                          337          11.03             232          35.83
 Headline costs excluding fuel                            1,681        53.48             844          129.92

Headline cost per seat excluding fuel for the Airline decreased by 59% to
£53.48 (H1 2021: £129.92), and also decreased by 59% at constant currency.

Included within the Group headline costs excluding fuel of £1,681 million,
£40 million related to the holidays business.

Operating costs and income

Group airports, ground handling and other operating costs increased by 498% to
£514 million, and Airline cost per seat increased by 19% to £15.65 (H1 2021:
£13.14), and by 23.1% at constant currency. Despite overall rate decreases
being obtained across several airports, and a release of airport charge
accruals of £10 million (H1 2021: £4 million) as the return of activity has
reduced some of the uncertainty and risks which were previously being accrued
for, improved load factors, an increase in security charges and de-icing
events drove the increase on a per seat basis.

Group crew costs increased by 42% to £318 million (H1 2021: £224 million),
and Airline cost per seat decreased by 70% to £10.48, and by 69.1% at
constant currency. This cost per seat decrease was primarily due to fixed
payroll costs being spread over higher flying capacity, partially offset by
furlough schemes which have been significantly reduced in the period (£8
million support H1 2022 v £73 million support H1 2021).

Group navigation costs increased by 340% to £110 million, and Airline cost
per seat decreased by 5% to £3.63 (H1 2021: £3.84) and by 1.2% at constant
currency, as a result of a decrease in the sector length of our commercial
flying compared to the comparative period, offset by an increase in
EuroControl rates effective January 2022.

Group maintenance costs increased by 44% to £157 million, and Airline cost
per seat decreased by 70% to £5.16 (H1 2021: £17.01), and decreased by 69.4%
at constant currency. This cost per seat decrease was driven by the fixed
element of our maintenance costs which have been spread over increased
capacity in the period, whilst also having a reduction in repair costs and
cleaning costs, the latter being driven by cost programme savings.

Group other costs increased by 15% to £183 million, and Airline cost per seat
decreased by 76% to £5.61 (H1 2021: £23.72), and by 69.8% at constant
currency. The significant driver in the decrease in the cost per seat is that
fixed costs are being spread over higher flown capacity.

Ownership costs

Depreciation costs have increased from £204 million in H1 2021 to £265
million in H1 2022. This increase was driven by higher maintenance-related
depreciation as a result of increased flying hours, combined with an increase
in the number of leased aircraft. This increase was partially offset by the
regular discounting of the maintenance provision which resulted in a credit in
the income statement of £19 million (H1 2021: credit £22 million) due to the
recent increase in US$ interest rates.

Net finance charges have increased from £15 million in H1 2021 to £59
million in H1 2022 with cost per seat decreasing from £2.35 to £1.92, with
the decrease per seat being a consequence of the higher capacity, partially
offset by increased bond interest costs. In addition to this, foreign exchange
gains as a result of the retranslation of foreign currency denominated assets
and liabilities have reduced from £23 million in H1 2021 to £2 million in H1
2022.

Fuel costs

           H1 2022                        H1 2021
           Group        Airline           Group        Airline

           £ million    £ per seat        £ million    £ per seat
 Fuel      362          11.94             97           15.08

Fuel costs for H1 2022 were £362 million, compared to £97 million for H1
2021. This increase in cost is largely driven by the 350% increase in flying
volumes. Fuel cost per seat of £11.94 was 20.8% lower than last year, and
decreased by 19.8% at constant currency.

During the first half of the year the average market price payable for jet
fuel increased by 99% from $382 per tonne in H1 2021 to $762 per tonne in H1
2022. However, the post hedge fuel price for H1 2022 was only $599 per tonne,
which is 13% lower than the post hedge fuel price of $688 per tonne in H1
2021. The low post hedge price in H1 2022 is due to forward contracts maturing
which were locked in at low rates when the fuel price was much lower in 2021.
The sector length has dropped 10.3% from 1,261km to 1,131km, which has
materially reduced the cost per seat in H1 2022 compared to H1 2021.

The Group uses jet fuel derivatives to hedge against sudden and significant
increases in jet fuel prices to mitigate cash and P&L volatility in the
short term. In order to manage the risk exposure, jet fuel derivative
contracts are used in line with the Board approved policy to hedge up to 18
months of estimated exposures in advance, with approximately 60% hedged on
average in the first 12 months.

KEY STATISTICS

 OPERATING MEASURES
                                                                                H1 2022      H1 2021       Increase/ (decrease)
 Seats flown (millions)                                                         30.3         6.4           373%
 Passengers (millions)                                                          23.4         4.1           471%
 Load factor                                                                    77.3%        63.7%         13.6 ppts
 Available seat kilometres (ASK) (millions)                                     34,287       8,088         323.9%
 Revenue passenger kilometres (RPK) (millions)                                  26,811       5,136         422.0%
 Average sector length (kilometres)                                             1,131        1,261         (10.3%)
 Sectors                                                                        167,865      35,100        378.2%
 Block hours ('000)                                                             329,060      73,311        348.9%
 Number of aircraft owned/leased at end of period                               322          330           (2.4%)
 Average number of aircraft owned/leased during period                          322          338           (4.6%)
 Number of aircraft operated at end of period                                   271          36            652.8%
 Average number of aircraft operated during period                              204          58            251.7%
 Number of routes operated at end of period                                       930        918           1.3%
 Number of airports served at end of period                                     150          151           (0.7%)

 FINANCIAL MEASURES
                                                                                H1 2022      H1 2021       Favourable/(adverse)
 Total return on capital employed                                               (12.3%)      (14.7%)       2.4 ppts
 Headline return on capital employed                                            (12.0%)      (16.8%)       4.8 ppts
 Total Airline loss before tax per seat (£)                                     (18.20)      (99.30)       81.7%
 Headline Airline loss before tax per seat (£)                                  (17.81)      (108.07)      83.5%
 Total Airline loss before tax per ASK (pence)                                  (1.61)       (7.87)        79.5%
 Headline Airline loss before tax per ASK (pence)                               (1.57)       (8.57)        81.7%
 Revenue
 Airline revenue per seat (£)                                                   47.61        36.93         28.9%
 Airline revenue per seat at constant currency (£)                              49.06        36.93         32.8%
 Airline revenue per ASK (pence)                                                4.21         2.93          43.7%
 Airline revenue per ASK at constant currency (pence)                           4.24         2.93          44.7%
 Airline revenue per passenger (£)                                              61.59        57.96         6.3%
 Airline revenue per passenger at constant currency (£)                         62.08        57.96         7.1%
 Costs
 Per seat measures
 Airline headline cost per seat (£)                                             (65.42)      (145.00)      54.9%
 Airline non-headline (cost)/income per seat (£)                                (0.40)       8.77          (104.6%)
 Airline total cost per seat (£)                                                (65.81)      (136.23)      51.7%
 Airline headline cost per seat excluding fuel (£)                              (53.48)      (129.92)      58.8%
 Airline headline cost per seat excluding fuel at constant currency (£)         (54.71)      (133.51)      59.0%
 Airline total cost per seat excluding fuel (£)                                 (53.87)      (121.15)      55.5%
 Airline total cost per seat excluding fuel at constant currency (£)            (55.12)      (124.72)      55.8%
 Per ASK measures
 Airline headline cost per ASK (pence)                                          (5.78)       (11.49)       49.7%
 Airline non-headline (cost)/income per ASK (pence)                             (0.04)       0.70          (105.7%)
 Airline total cost per ASK (£)                                                 (5.82)       (10.80)       46.1%
 Airline headline cost per ASK excluding fuel (pence)                           (4.73)       (10.30)       54.1%
 Airline headline cost per ASK excluding fuel at constant currency (pence)      (4.84)       (9.45)        48.8%
 Airline total cost per ASK excluding fuel (pence)                              (4.76)       (9.61)        50.5%
 Airline total cost per ASK excluding fuel at constant currency (pence)         (4.87)       (9.02)        46.0%

PRINCIPAL RISKS AND UNCERTAINTIES

easyJet continues to face a range of risks that could impact delivery of our
corporate and strategic initiatives. The easyJet Board is responsible for
determining the nature of these risks and ensuring that appropriate mitigating
actions are in place to manage them. The Board delegates responsibility to the
Corporate Risk team to manage the Corporate Risk Framework. easyJet continues
to develop its Corporate Risk Framework to ensure that risks, including
emerging risks, are identified, assessed, managed, and articulated.

Over the course of H1 2022 the Corporate Risk team has spent time with each
area of the business, ensuring that risks continue to be identified and
assessed in line with the Risk Framework. This has been conducted via
functional and business unit risk reviews.

The principal risks and uncertainties set out in the 2021 Annual Report and
Accounts have not materially changed except for the inclusion of a specific
Climate Change Transition Risk. This follows a deep dive into the risks
arising from society's transition to a low carbon and a more climate-friendly
future. Two existing principal risks (Carbon Trading Schemes and Increased
Taxation) have been incorporated into the new Climate Change Transition Risk.

easyJet's risk themes remain unchanged and are as follows:

●       Asset Efficiency & Effectiveness

●       Environment & Sustainability

●       Legislative / Regulatory Landscape

●       Macro-economic & Geopolitical

●       People

●       Safety, Security, and Operations

●       Technology & Cyber

 

For the second half of FY22, the Directors consider that the principal risks
and uncertainties detailed in the 2021 Annual Report and Accounts (with the
addition of the Climate Change Transition risk detailed below) are expected to
be representative of the potential impacts on the Group's performance. In
addition to continually reviewing the risks reported in the 2021 Annual Report
and Accounts, and emerging risks, the Board is monitoring the impact of the
Ukraine crisis which is set out below.

Case Study: Climate Change Transition Risks

The Corporate Risk and Sustainability teams have concluded a deep dive to
identify the risks that easyJet faces as it transitions to a low carbon and a
more climate-friendly future.

The diagram below shows how the risks identified have been categorised and
structured within the Corporate Risk Framework and Register.

 Principal Risk    Climate Change Transition Risk

                   Risks arising from easyJet's response to societal and economic shifts toward a
                   low-carbon and more climate-friendly future
 Corporate Risk    Cost of Emissions                                                             Civil Society (incl. Consumer) Sentiment           Emissions Reduction                                                             Financial Markets Sentiment

                   A changing legal and regulatory landscape that impacts price e.g. carbon      Changing preferences to sustainable alternatives   Technological and operational developments that drive a step change reduction   Divestment of carbon intensive assets and/ or assets that are not working
                   pricing mechanisms, green taxes (e.g. incl. NOx and "persistent contrails")
                                                  in aviation emissions e.g. novel aircraft, SAF, modernised airspace             towards Net-Zero
                   and demand suppression policies, and how these pricing impacts will affect

                   easyJet

 Functional Risks  Reputation

                   Perception of an organisation's contribution to a lower-carbon transition
                                                                                                                                                                                                                                    Clim
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                   Sub-risks                                                                     Sub-risks                                          Sub-risks                                                                       Sub-risks

The workshops involved colleagues from every area of the business and
identified the key functional level risks within each corporate level risk
category. These have been documented in the Climate Change Transition risk
register and appropriate ownership and management assigned. Governance for
these risks will be applied through easyJet's Sustainability Steering
Committee, which will regularly review and challenge the risks and associated
controls. The Climate Change Risk Register, along with the Net Zero Plan, will
be continually reviewed and are inputs into the five year planning process,
which includes the Strategic Plan and Financial Plan.

Ukraine Crisis

easyJet is deeply shocked and saddened by the Russian invasion of Ukraine.
While our flying schedule has been unaffected, risks have arisen and required
a response by the appropriate functions. Sharp increases in fuel costs have
been mitigated through our fuel hedging policy and have ensured the cost
incurred per metric tonne has remained (and will continue to do so through
Winter '22) well below the current spot rates. Our Digital Safety team
continues to monitor the increased threat of a cyber-attack to our network and
systems. Recent increased investment into our cyber defences has improved our
monitoring capabilities and allows the business to respond quickly and
effectively as threats arise. The potential for increased aviation insurance
premiums and/ or changes to insurance coverage may occur due to the likelihood
of a significant insurance claim arising from western leased aircraft trapped
in Russia. easyJet has very limited influence over this risk, as it is not
involved in this insurance claim, but it will continue to differentiate itself
from competitors in the insurance market in order to achieve the insurance
costs and pricing that support the business' objectives. Rising costs,
especially from our supply chain, continue to be monitored as they develop. It
is too early to fully report on the impact, but the Corporate Risk team will
work with the central Procurement team to monitor the risk and respond
appropriately.

CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION

Condensed consolidated income statement (unaudited)

                                                                           Six months ended 31 March
                                                                           2022                                                 2021
                                                                           Headline    Non-headline (note 3)  Total             Headline    Non-headline (note 3)  Total
                                                   Notes                   £ million   £ million              £ million         £ million   £ million              £ million
 Passenger revenue                                                         985         -                      985               170         -                      170
 Ancillary revenue                                                         513         -                      513               70          -                      70
 Total revenue                                                             1,498       -                      1,498             240         -                      240

 Fuel                                                                      (362)       -                      (362)             (97)        -                      (97)
 Airports, ground handling and other operating costs                       (514)       -                      (514)             (86)        -                      (86)
 Crew                                                                      (318)       -                      (318)             (224)       -                      (224)
 Navigation                                                                (110)       -                      (110)             (25)        -                      (25)
 Maintenance                                                               (157)       -                      (157)             (109)       -                      (109)
 Selling and marketing                                                     (68)        -                      (68)              (17)        -                      (17)
 Other costs                                                               (183)       (12)                   (195)             (158)       17                     (141)
 Other income                                                              6           (1)                    5                 7           68                     75
 EBITDAR                                                                   (208)       (13)                   (221)             (469)       85                     (384)

 Aircraft dry leasing                                                      (1)         -                      (1)               (2)         -                      (2)
 Depreciation                                      7                       (265)       -                      (265)             (204)       -                      (204)
 Amortisation of intangible assets                                         (12)        -                      (12)              (11)        -                      (11)
 Operating (loss)/profit                                                   (486)       (13)                   (499)             (686)       85                     (601)

 Interest receivable and other financing income                            6           2                      8                 26          25                     51
 Interest payable and other financing charges                              (65)        (1)                    (66)              (41)        (54)                   (95)
 Net finance charge                                                        (59)        1                      (58)              (15)        (29)                   (44)

 Loss before tax                                                           (545)       (12)                   (557)             (701)       56                     (645)

 Tax credit/(charge)                               4                       123         3                      126               126         (30)                   96

 Loss for the period                                                       (422)       (9)                    (431)             (575)       26                     (549)

 Loss per share, pence
 Basic                                             5                                                          (57.2)                                               (102.0)

Condensed consolidated statement of comprehensive income (unaudited)

                                                                                    Six months ended  Six months ended
                                                                                    31 March 2022                31 March 2021
                                                                             Notes  £ million                    £ million
 Loss for the period                                                                (431)                        (549)
 Other comprehensive loss

 Items that may be reclassified to the income statement
 Cash flow hedges
 Fair value gains in the period                                                     396                          281
 Gains transferred to income statement                                              (118)                        (27)
  Hedge discontinuation (gains)/losses transferred to income statement              (5)                          28
 Related tax charge                                                          4      (53)                         (53)
 Cost of hedging                                                                    3                            (2)

 Items that will not be reclassified to the income statement
 Remeasurement of post-employment benefit                                           23                           (2)

 obligations
 Related deferred tax charge                                                 4      (6)                          (1)
                                                                                    240                          224
 Total comprehensive loss for the period                                            (191)                        (325)

Condensed consolidated statement of financial position (unaudited)

                                                        31 March        30 September 2021
                                                        2022
                                             Notes      £ million       £ million
 Non-current assets
 Goodwill                                               365             365
 Other intangible assets                                216             217
 Property, plant and equipment               7          4,683           4,735
 Derivative financial instruments                       31              86
 Equity investments                                     30              30
 Restricted cash                                        1               1
 Other non-current assets                               49              135
 Deferred tax assets                                    109             39
                                                        5,484           5,608
 Current assets
 Trade and other receivables                            336             291
 Intangible assets                                      519             140
 Derivative financial instruments                       487             185
 Restricted cash                                        4               13
 Money market deposits                                  258             -
 Cash and cash equivalents                              3,247           3,536
                                                        4,851           4,165
 Current liabilities
 Trade and other payables                               (1,362)         (1,128)
 Unearned revenue                                       (1,778)         (844)
 Borrowings                                  8          (423)           (300)
 Lease liabilities                                      (230)           (189)
 Derivative financial instruments                       (9)             (31)
 Current tax payable                                    (6)             (2)
 Provisions for liabilities and charges      9          (177)           (183)
                                                        (3,985)         (2,677)

 Net current assets                                     866             1,488

 Non-current liabilities
 Unearned revenue                                       (2)             (2)
 Borrowings                                  8          (2,623)         (3,067)
 Lease liabilities                                      (825)           (890)
 Derivative financial instruments                       (38)            (37)
 Non-current deferred income                            (4)             (4)
 Post-employment benefit obligations                    (11)            (37)
 Provisions for liabilities and charges      9          (407)           (420)
                                                        (3,910)         (4,457)

 Net assets                                             2,440           2,639

 Shareholders' equity
 Share capital                                          207             207
 Share premium                                          2,166           2,166
 Hedging reserve                                        364             156
 Cost of hedging reserve                                2               (1)
 Translation reserve                                    (2)             -
 Retained earnings                                      (297)           111
 Total Equity                                           2,440           2,639

Condensed consolidated statement of cash flows (unaudited)

                                                                  Six months ended          Six months ended
                                                                             31 March 2022             31 March 2021
                                                           Notes             £ million                 £ million
 Cash flows from operating activities
 Cash generated/(used) from operations                     11                590                       (1,118)
 Interest and other financing charges paid                                   (148)                     (71)
 Net tax paid                                                                1                         (5)
 Net cash generated/(used) from operating activities                         443                       (1,194)

 Cash flows from investing activities
 Purchase of property, plant and equipment                                   (236)                     (71)
 Purchase of non-current intangible assets                                   (11)                      (2)
 Net (increase)/decrease in money market deposits                            (258)                     32
 Net proceeds from sale and leaseback of aircraft                            87                        810
 Net cash (used)/generated from investing activities                         (418)                     769

 Cash flows from financing activities
 Proceeds from issue of ordinary share capital                               91                        -
 Share issue transaction costs                                               (37)                      -
 Purchase of own shares for employee share schemes                           (4)                       (3)
 Proceeds from Eurobond issue and UKEF                                       -                         1,804
 Repayment of bank loans and other borrowings                                (300)                     (1,043)
 Repayment of capital element of leases                                      (92)                      (174)
 Net decrease in restricted cash                                             9                         6
 Net cash (used)/generated by financing activities                           (333)                     590

 Effect of exchange rate changes                                             19                        (114)

 Net (decrease)/increase in cash and cash equivalents                        (289)                     51

 Cash and cash equivalents at beginning of period                            3,536                     2,284

 Cash and cash equivalents at end of period                                  3,247                     2,335

Condensed consolidated statement of changes in equity (unaudited)

                                              Share           Share premium      Hedging reserve  Cost of hedging reserve  Translation reserve  Retained earnings      Total

                                              capital

                                              £ million       £ million          £ million        £ million                £ million            £ million              £ million
 At 1 October 2021                            207             2,166              156              (1)                      -                    111                    2,639
 Loss for the period                          -               -                  -                -                        -                    (431)                  (431)
 Other comprehensive income                   -               -                  220              3                        -                    17                     240
 Total comprehensive income/(loss)            -               -                  220              3                        -                    (414)                  (191)
 Transfers to Property Plant & Equipment      -               -                  (12)             -                        -                    -                      (12)
 Share incentive schemes
    Value of employee services                -               -                  -                -                        -                    10                     10
    Purchase of own shares                    -               -                  -                -                        -                    (4)                    (4)
 Currency translation differences             -               -                  -                -                        (2)                  -                      (2)
 At 31 March 2022                             207             2,166              364              2                        (2)                  (297)                  2,440

                                              Share           Share premium      Hedging reserve  Cost of hedging reserve  Translation reserve  Retained earnings      Total

                                              capital

                                              £ million       £ million          £ million        £ million                £ million            £ million              £ million
 At 1 October 2020                            125             1,051              (236)            1                        (2)                  960                    1,899
 Loss for the period                          -               -                  -                -                        -                    (549)                  (549)
 Other comprehensive income/(expense)         -               -                  228              (2)                      -                    (2)                    224
 Total comprehensive income/(loss)            -               -                  228              (2)                      -                    (551)                  (325)
 Share incentive schemes
    Value of employee services                -               -                  -                -                        -                    8                      8
    Purchase of own shares                    -               -                  -                -                        -                    (3)                    (3)
 Currency translation differences             -               -                  -                -                        3                    -                      3
 At 31 March 2021                             125             1,051              (8)              (1)                      1                    414                    1,582

The hedging reserve comprises the effective portion of the cumulative net
change in fair value of cash flow hedging instruments relating to highly
probable transactions that are forecast to occur after the period end.

 

 

Notes to the condensed consolidated interim financial information (unaudited)

1. General information

easyJet plc (the Company) is a Company registered in England (Company no.
03959649) domiciled in the United Kingdom (UK). The condensed consolidated
interim financial information of the Company as at and for the six months
ended 31 March 2022 comprise the Company and its interest in its subsidiaries
(together referred to as the Group). Its principal business is that of a
low-cost airline carrier operating primarily in Europe. The consolidated
financial statements of the Group as at and for the year ended 30 September
2021 are available upon request to the Company Secretary from the Company's
registered office at Hangar 89, London Luton Airport, Luton, Bedfordshire, LU2
9PF or are available on the corporate website at http://corporate.easyJet.com.

Basis of preparation

The condensed consolidated interim financial information has been prepared in
accordance with IAS 34 'Interim Financial Reporting' under UK-adopted
international accounting standards and the Disclosure and Transparency Rules
of the United Kingdom's Financial Conduct Authority. It should be read in
conjunction with the Annual Report and Accounts for the year ended 30
September 2021, which were prepared in accordance with international
accounting standards in conformity with the requirements of the Companies Act
2006 and in accordance with IFRSs adopted pursuant to Regulation (EC) No
1606/2002 as it applies in the European Union.

The annual financial statements for the Group for the year ended 30 September
2022 will be prepared in accordance with UK-adopted international accounting
standards in conformity with the requirements of the Companies Act 2006. This
will not result in any change in accounting from the year ended 30 September
2021.

The interim financial information does not constitute statutory accounts
within the meaning of sections 434 and 435 of the Companies Act 2006.
Statutory accounts for the year ended 30 September 2021 were approved by the
Board of Directors on 30 November 2021 and have been delivered to the
Registrar of Companies. The report of the auditors was unqualified.

The Group's financial risk management objectives and policies are materially
consistent with those disclosed in the consolidated financial statements as at
and for the year ended 30 September 2021.

Going concern

In adopting the going concern basis for preparing these interim financial
statements, the Directors have considered easyJet's business activities,
together with factors likely to affect its future development and performance,
as well as easyJet's principal risks and uncertainties.

As at 31 March 2022 easyJet has a net debt position of £0.6 billion including
cash and cash equivalents and money market deposits of £3.5 billion, with
unrestricted access to £4.4 billion of liquidity (including £258 million of
money market deposits) and has retained ownership of 55% of the total fleet
with 39% being unencumbered.

The Directors have reviewed the financial forecasts and funding requirements
with consideration given to the potential impact of severe but plausible
risks. easyJet has modelled a base case representing management's best
estimation of how the business plans to recover trading in light of the
relaxation of travel restrictions coming out of the pandemic. The model
assumes near 2019 capacity for H2 2022 and a return to 2019 capacity for 2023
financial year.

The business is exposed to fluctuations in fuel prices and foreign exchange
rates. easyJet is currently c.71% hedged for fuel in H2 of FY22 at c.US$619
per metric tonne, c.49% hedged for H1 FY23 at c.US$701 and c.20% hedged for H2
FY23 at c.US$807 per metric tonne.

In modelling the impact of severe but plausible downside risks, the Directors
have considered demand suppression leading to a reduction in yield for 2023 to
2022 levels and reduced capacity of 5% as well as sensitivities on fuel price
(fuel price assumed to remain at higher levels to currently hedged/forward
rates throughout the forecast period), operational costs (additional inflation
assumed on all costs), and delays in delivery of strategic initiatives. These
impacts have been modelled across the whole going concern period. In addition,
this downside scenario also includes a short-term partial grounding of 25% of
the fleet for one month in August to cover the range of severe but plausible
risks that could result in significant operational disruption. This downside
scenario resulted in a significant reduction in liquidity but still maintained
sufficient headroom on external liquidity requirements.

After reviewing the current liquidity position, committed funding facilities
and the base case and severe but plausible downside financial forecasts
incorporating the uncertainties described above, the Directors have a
reasonable expectation that the Group has sufficient resources to continue in
operation for the foreseeable future. For these reasons the Directors continue
to adopt the going concern basis of accounting in preparing the Group's
financial statements.

Accounting policies

The accounting policies adopted are consistent with those described in the
Annual report and accounts for the year ended 30 September 2021.

New and revised standards and interpretations

The amendments that became applicable for the first time in the current annual
reporting period, and did not have a material impact were:

•             Covid-19 related rent concessions beyond June 30,
2021 - Amendments to IFRS 16 Leases; and

•             Interest rate benchmark reform - Phase 2 -
amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16

In the financial year ending September 2020, the Group early adopted the
'Interest Rate Benchmark Reform Phase 1' amendments to IFRS 9 and IFRS 7
applying it retrospectively to accounting relationships that existed before
the start of the current reporting period. The impact of IBOR reform on the
Group was assessed as being limited, with this amendment only applicable to
one hedge relationship. This allowed the Group to continue hedge accounting
for the impacted fair value hedge during the period of uncertainty from
interest rate benchmark reforms.

During the current reporting period, the Group has adopted the 'Interest Rate
Benchmark Reform Phase 2' amendments to IFRS 9, and IFRS 7 and has applied
this to the specific hedging relationship identified. Three cross-currency
interest rate swaps are used to convert the entire €500 million fixed rate
Eurobond to a Sterling floating rate exposure. All three swaps originally were
based on three-month LIBOR. Following the cessation of GBP LIBOR, the floating
interest transitioned to the ISDA Fallback Rate for fixings from January 2022.

The Group has elected to apply the phase 2 reliefs and has amended its hedge
designation and documentation to reflect these changes which are required by
IBOR reform. Such amendments did not give rise to the hedge relationship being
discontinued.

The LIBOR transition working group which was formed in the prior year
continues to consider the wider impacts on the business of these changes. No
other material impacts have emerged during the period.

There are no standards that are issued but not yet effective that would be
expected to have a material impact on the entity in the current or future
reporting periods and on foreseeable future transactions.

Estimates and judgements

The preparation of accounts in conformity with generally accepted accounting
principles requires the use of estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the accounts and the
reported amounts of income and expenses during the reporting period. Although
these amounts are based on management's best estimates, events or actions may
mean that actual results ultimately differ from those estimates, and these
differences may be material. The estimates and the underlying assumptions are
reviewed regularly.

In preparing these condensed consolidated interim financial statements, the
key judgements and estimates are, with the exception of hedge discontinuation
and ineffectiveness which is no longer considered to be a key judgement, the
same as those applied in the most recently published consolidated financial
statements.

The Group has concluded that the deferred tax assets will be recoverable
against the unwind of the taxable temporary differences and the future taxable
income based on the strategic plans of the Group. The losses can be carried
forward indefinitely and have no expiry date, but it is expected that the
deferred tax asset would be recovered within a seven-year time horizon.

2. Seasonality

The airline industry is highly seasonal and demand and yields are
significantly higher during the summer. Accordingly, revenue and profitability
are usually higher in the second half of the financial year. Historically,
easyJet has reported a loss/low profit for the first half of the financial
year which the ongoing impact of the Covid-19 pandemic has continued to
exacerbate.

3. Non-headline items

Non-headline items are those where, in management's opinion, their separate
reporting provides an additional understanding to users of the financial
statements of easyJet's underlying trading performance, and which are
significant by virtue of their size and/or nature. In considering the
categorisation of an item as non-headline, management's judgement includes,
but is not limited to, a consideration of:

·    Whether the item is outside of the principal activities of the
easyJet Group (being to provide point-to-point airline services and package
holidays).

·    The specific circumstances which have led to the item arising,
including, if extinguishing an item from the balance sheet, whether that item
was first generated via headline or non-headline activity. The rebuttable
presumption being that when subsequently extinguishing an item from the
balance sheet, any impact on the income statement should be reflected in the
same way as that which was used in the initial creation of the item.

·    The likelihood and potential regularity of recurrence.

·    Whether the item is unusual by virtue of its size.

 

Non-headline items may include impairments, amounts relating to corporate
acquisitions and disposals, expenditure on major restructuring programmes and
the gain or loss resulting from the initial recognition of sale and leaseback
transactions.

The measure of profit which excludes non-headline items is described as
'headline' and is used by the Directors to measure and monitor performance.

An analysis of the amounts presented as 'non-headline' is given below:

                                                Six months ended          Six months ended
                                                           31 March 2022             31 March 2021
                                                           £ million                 £ million
 Sale and leaseback loss/(gain)                            21                        (60)
 Restructuring credit                                      (8)                       (25)
 Recognised in operating loss                              13                        (85)
 Hedge discontinuation (credit)/charge                     (1)                       29
 Total non-headline charge/(credit) before tax             12                        (56)
 Tax on non-headline items                                 (3)                       30
 Total non-headline charge/(credit) after tax              9                         (26)

 

Sale and leaseback

During the period, easyJet completed the sale and leaseback of 10 A319
aircraft (H1 2021: 7), nil A320 (H1 2021: 24) and nil A321 (H1 2021: 4). The
Income Statement impact of the 10 sale and leasebacks was a £21 million loss
recognised in Other costs (H1 2021: £68 million gain recognised in Other
income offset by a £8m loss recognised in Other costs).

Restructuring

As a result of the Covid-19 pandemic a restructuring process was undertaken.
During the period the associated provision was updated to reflect ongoing
discussions with unions which resulted in an £8 million credit being
recognised within Other costs (H1 2021: £25 million credit). The programme is
expected to complete in the financial year 2022.

Hedge discontinuations

This relates to hedge accounting ineffectiveness for items currently held in
fair value and cash flow hedge relationships, and the cumulative fair value of
financial derivatives at the time of being discontinued from a previous hedge
accounting relationship.

In accordance with IFRS 9, hedge effectiveness testing is performed on a
regular, periodic basis. For cash flow hedges this includes an assessment of
highly probable future cash exposures with the amount compared to the notional
value of derivatives held in a hedge relationship. Due to the reduced level of
commercial flying over the pandemic, easyJet has been in an over-hedged
position from both a jet fuel and FX perspective. Where forecast exposures are
no longer expected to occur, these previously hedged amounts no longer qualify
for hedge accounting. The cumulative fair value movement of a £1m million net
gain (2021: £29 million loss) related to these ineffective derivatives held
in Other Comprehensive Income has then been immediately recorded in the income
statement.

Tax on non-headline items

After the necessary tax adjustments which principally relate to the sale and
leaseback transactions in both the current and comparative periods, the tax
adjusted non-headline items amount to a loss of £14 million ( H1 2021: £159
million profit) which results in a tax credit of £3 million (H1 2021: £30
million charge) for the period.

 

4. Tax credit

 Tax on loss on ordinary activities:
                                                  Six months ended       Six months ended
                                                  31 March 2022          31 March 2021
                                                             £ million              £ million
 Current tax                                                 3                      1
 Deferred tax                                                (129)                  (97)
                                                             (126)                  (96)

 Effective tax rate                                          22.7%                  14.9%
 Effective tax rate excluding rate change impact             16.8%                  14.9%

 

The forecast effective tax rate (using currently enacted rates) is higher than
the standard rate of corporation tax in the United Kingdom (19%), principally
due to timing differences being recognised at the substantively enacted tax
rate for deferred tax (generally 25%). This is on the basis that the Finance
Act 2021 confirmed the increase of the UK Corporation Tax rate from 19% to 25%
effective from 1 April 2023. As such, timing differences that unwind after
this date are recognised at 25%.

Had this change in tax rate not been substantively enacted, the effective tax
rate (15.6%) would be lower than the standard rate of corporation tax,
principally due to permanent tax differences and differences in tax rates in
jurisdictions where easyJet has a taxable presence outside of the UK. The
permanent tax costs are as a result of the sale and leaseback transactions
(disclosed within note 3) as well as other disallowable expenses.

The forecasted effective tax rates have been determined on the premise that
the tax loss as at H1 2022 is recoverable in full.

 

 Tax on items recognised directly in other comprehensive income
                                                           Six months ended          Six months ended
                                                                      31 March 2022             31 March 2021
                                                                      £ million                 £ million
 Charge to other comprehensive income
 Deferred tax charge on defined benefit scheme                        (6)                       (1)
 Deferred tax on fair value movements of cash flow hedges             (53)                      (53)
 Total charge to other comprehensive income                           (59)                      (54)

 There was no tax on items recognised directly in shareholders' equity in the
 period (H1 2021: £nil).

 

5. Loss per share

As a result of the rights issue in September 2021, the comparative loss per
share has been restated having applied the relevant bonus factor to the
calculator of the weighted average number of shares.

 

                                                                                  Six months ended      Six months ended
                                                                                  31 March 2022         31 March 2021
                                                                                  £million              £million
                                                                                                        (restated)
 Headline loss for the period                                                     (422)                 (575)
 Total loss for the period                                                        (431)                 (549)

                                                                                  Six months ended      Six months ended
                                                                                  31 March 2022         31 March 2021
                                                                                  million               million
                                                                                                        (restated)
 Weighted average number of ordinary shares used to calculate basic loss per      754                   538
 share

                                                                                  Six months ended      Six months ended
                                                                                  31 March 2022         31 March 2021
                                                                                  pence                 pence
 Basic loss per share                                                                                   (restated)
 Total                                                                            (57.2)                (102.0)
 Adjustment for non-headline                                                      1.2                   (4.9)
 Headline                                                                         (56.0)                (106.9)

Diluted earnings per share figures are not presented for either period as the
impact of potential ordinary shares is anti-dilutive.

6. Segmental Reporting

                                Six months ending 31 March 2022
                                Airline     Holidays    Intra-group transactions  Group
                                £ million   £ million   £ million                 £ million
 Revenue                        1,444       73          (19)                      1,498
 Operating costs excl fuel      (1,287)     (76)        19                        (1,344)
 Fuel                           (362)       -           -                         (362)
 Ownership costs                (335)       (2)         -                         (337)
 Headline loss before tax       (540)       (5)         -                         (545)
 Non-headline items             (12)        -           -                         (12)
 Total loss before tax          (552)       (5)         -                         (557)

                                Six months ending 31 March 2021
                                Airline     Holidays    Intra-group transactions  Group
                                £ million   £ million   £ million                 £ million
 Revenue                        237         4           (1)                       240
 Operating costs excl fuel      (604)       (10)        1                         (613)
 Fuel                           (97)        -           -                         (97)
 Ownership costs                (229)       (2)         -                         (231)
 Headline loss before tax       (693)       (8)         -                         (701)
 Non-headline items             56          -           -                         56
 Total loss before tax          (637)       (8)         -                         (645)

The intra-group transaction column represents intercompany costs from Airline
to holidays which are recorded at arm's length and are eliminated on
consolidation. Individual cost lines are not reported separately as these are
not key metrics reported to the Chief Operating Decision Maker (CODM). Assets
and liabilities are not allocated to individual segments and are not
separately reported to or reviewed by the CODM, and therefore these have not
been disclosed. Interest income and expenditure are not allocated to segments
as this activity is driven by the central treasury function which manages the
cash position of the Group.

7. Property, plant and equipment

                                Owned assets                                                      Right of use assets held under leasing arrangements              Total
                                Aircraft and spares       Land and buildings      Other           Aircraft and spares                      Other                   Total
                                £ million                 £ million               £ million       £ million                                £ million               £ million
 Cost
 At 1 October 2021              4,802                     44                      55              2,335                                    45                      7,281
 Additions                      240                       -                       5               56                                       -                       301
 Aircraft sold and leased back  (215)                     -                       -               26                                       -                       (189)
 Disposals                      (3)                       -                       -               -                                        -                       (3)
 At 31 March 2022               4,824                     44                      60              2,417                                    45                      7,390
 Depreciation
 At 1 October 2021              1,243                     -                       19              1,255                                    29                      2,546
 Charge for the period          129                       -                       5               130                                      3                       267
 Aircraft sold and leased back  (104)                     -                       -               -                                        -                       (104)
 Disposals                      (2)                       -                       -               -                                        -                       (2)
 At 31 March 2022               1,266                     -                       24              1,385                                    32                      2,707
 Net book value
 At 31 March 2022               3,558                     44                      36              1,032                                    13                      4,683
 At 1 October 2021              3,559                     44                      36              1,080                                    16                      4,735

                                Owned assets                                                      Right of use assets held under leasing arrangements              Total
                                Aircraft and spares       Land and buildings      Other           Aircraft and spares                      Other                   Total
                                £ million                 £ million               £ million       £ million                                £ million               £ million
 Cost
 At 1 October 2020              5,520                     44                      44              1,692                                    37                      7,337
 Additions                      112                       -                       28              148                                      8                       296
 Transfers                      64                        -                       -               (64)                                     -                       -
 Aircraft sold and leased back  (828)*                    -                       (15)            559                                      -                       (284)*
 Disposals                      (66)*                     -                       (2)             -                                        -                       (68)*
 At 30 September 2021           4,802                     44                      55              2,335                                    45                      7,281
 Depreciation
 At 1 October 2020              1,187                     -                       12              1,062                                    23                      2,284
 Charge for the period          227                       -                       7               216                                      6                       456
 Transfers                      23                        -                       -               (23)                                     -                       -
 Aircraft sold and leased back  (153)*                    -                       -               -                                        -                       (153)*
 Disposals                      (41)*                     -                       -               -                                        -                       (41)*
 At 30 September 2021           1,243                     -                       19              1,255                                    29                      2,546
 Net book value
 At 30 September 2021           3,559                     44                      36              1,080                                    16                      4,735
 At 1 October 2020              4,333                     44                      32              630                                      14                      5,053

The net book value of aircraft includes £308 million (H1 2021: £312 million)
relating to advance and option payments for future aircraft deliveries. This
amount is not depreciated.

At 31 March 2022 easyJet was contractually committed to the acquisition of 115
(H1 2021: 101) Airbus A320 family aircraft, with a total list price of
US$14.46 billion (H1 2021: US$12.31 billion) before escalations and discounts
for delivery. It is expected that three aircraft will be delivered for the
remainder of FY 2022 and seven aircraft deliveries in FY 2023.

*£33m of cost and £33m of accumulated depreciation from components disposed
of in the year ended 30 September 2021 were identified which were previously
included as Disposals, which have now been presented in Aircraft sold and
leased back, reflecting the aircraft with which they were associated.

 

8. Borrowings

                                                            Current         Non-current      Total
                                                            £ million       £ million        £ million
 At 31 March 2022
 Eurobonds                                                  423             1,838            2,261
 Term Loan (UK Export Finance backed facility)              -               785              785
                                                            423             2,623            3,046

 At 30 September 2021
 Eurobonds                                                  -               2,303            2,303
 Term Loan (UK Export Finance backed facility)              -               764              764
 Commercial Paper (Covid Corporate Financing facility)      300             -                300
                                                            300             3,067            3,367

Amounts above are shown net of issue costs or discounted amounts which are
amortised at the effective interest rate over the life of the debt
instruments.

The remaining Covid Corporate Financing Facility (CCFF) of £300 million was
repaid in November 2021.

See the note 10 for further information on borrowings.

 

9. Provisions for liabilities and charges

                                               Maintenance provisions      Provisions for customer claims      Restructuring      Other Provisions      Total provisions
                                               £ million                   £ million                           £ million          £ million             £ million
 At 1 October 2021                             550                         21                                  18                 14                    603
 Exchange adjustments                          10                           -                                   -                  -                    10
 Charged/(credited) to income statement        44                          13                                  (8)                1                     50
 Related to aircraft sold and leased back      6                            -                                   -                  -                    6
 Unwinding of discount                         (19)                         -                                   -                  -                    (19)
 Utilised                                      (51)                        (11)                                (4)                 -                    (66)
 At 31 March 2022                              540                         23                                  6                  15                    584

Maintenance provisions comprise of maintenance costs arising from legal and
constructive obligations relating to the condition of the aircraft when
returned to the lessor. Restructuring and other provisions include amounts in
respect of potential liabilities for employee-related matters and litigation
which arose in the normal course of business.

 

                  31 March 2022      30 September 2021
                  £ million          £ million
 Current          177                183
 Non-current      407                420
                  584                603

 

Maintenance provisions are expected to be utilised within ten years.
Provisions for customer claims, restructuring, and other provisions could be
fully utilised within one year from 31 March 2022 and therefore are classified
as current.

The split of the current / non-current maintenance provision is based on the
current expected maintenance event timings. If actual aircraft usage varies
from expectations, the timing of the utilisation of the maintenance provision
could result in a material change in the classification between current and
non-current.

 

10. 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:

                                   Amortised cost                                      Held at fair value
 At 31 March 2022                  Financial assets         Financial liabilities      Fair value hedges        Cash flow hedges        Other financial instruments      Other ((1))      Carrying        Fair

                                                                                                                                                                                          value           value
                                   £ million                £ million                  £ million                £ million               £ million                        £ million        £ million       £ million
 Other non-current assets          49                       -                          -                        -                       -                                -                49              49
 Trade and other receivables       141                      -                          -                        -                       -                                195              336             336
 Trade and other payables          -                        (1,125)                    -                        -                       -                                (237)            (1,362)         (1,362)
 Derivative financial instruments  -                        -                          44                       417                     10                               -                471             471
 Restricted cash                   5                        -                          -                        -                       -                                -                5               5
 Money market deposits             258                      -                          -                        -                       -                                -                258             258
 Cash and cash equivalents         1,909                    -                          -                        -                       1,338                            -                3,247           3,247
 Eurobonds ((3),(4),(5),(6))       -                        (2,261)                    -                        -                       -                                -                (2,261)         (2,218)
 Other Borrowings ((7))            -                        (785)                      -                        -                       -                                -                (785)           (785)
 Lease liabilities                 -                        (1,055)                    -                        -                       -                                -                (1,055)         N/A
 Equity Investments ((2))          -                        -                          -                        -                       30                               -                30              30

                                   Amortised cost                                    Held at fair value
 At 30 September 2021              Financial assets         Financial liabilities    Fair value hedges        Cash flow hedges        Other financial instruments    Other ((1))    Carrying      Fair

                                                                                                                                                                                    value         value
                                   £ million                £ million                £ million                £ million               £ million                      £ million      £ million     £ million
 Other non-current assets          135                      -                        -                        -                       -                              -              135           135
 Trade and other receivables       178                      -                        -                        -                       -                              113            291           291
 Trade and other payables          -                        (826)                    -                        -                       -                              (302)          (1,128)       (1,128)
 Derivative financial instruments  -                        -                        53                       153                     (3)                            -              203           203
 Restricted cash                   14                       -                        -                        -                       -                              -              14            14
 Cash and cash equivalents         1,932                    -                        -                        -                       1,604                          -              3,536         3,536
 Eurobonds ((3),(4),(5))           -                        (2,303)                  -                        -                       -                              -              (2,303)       (2,380)
 Other Borrowings                  -                        (1,064)                  -                        -                       -                              -              (1,064)       (1,064)
 Lease liabilities                 -                        (1,079)                  -                        -                       -                              -              (1,079)       N/A
 Equity Investments ((2))          -                        -                        -                        -                       30                             -              30            30

(1). Amounts disclosed in the 'Other' column are items that do not meet the
definition of a financial instrument. They are disclosed to facilitate
reconciliation of the carrying values of financial instruments to line items
presented in the statement of financial position.

(2). The equity investment of £30 million represents a 13.2% shareholding in
a non‐listed entity, The Airline Group Limited. Valuation movements are
designated as being fair valued through other comprehensive income due to the
nature of the investment being held for strategic purposes.

(3). In February 2016, easyJet plc issued a €500 million bond under the
£3,000 million Euro Medium Term Note Programme guaranteed by easyJet Airline
Company Limited. The Eurobond is for a seven year-term and pays an annual
fixed coupon of 1.750%. At the same time the Group entered into three
cross-currency interest rate swaps to convert the entire €500 million fixed
rate Eurobond to a Sterling floating rate exposure. All three swaps originally
paid floating interest (three-month LIBOR plus a margin) quarterly, receive
fixed interest annually, and have maturities matching the Eurobond. Following
the cessation of GBP LIBOR the floating interest transitioned to the ISDA
Fallback Rate for fixings from January 2022. The Group designated all three
cross-currency interest rate swaps as a fair value hedge of the interest rate
and currency risks on the €500 million Eurobond. The swaps are measured at
fair value through profit or loss with any gains or losses being taken
immediately to the income statement (except where related to timing
differences related to-cross currency basis amortisation). The carrying value
of the Eurobond is adjusted for changes in fair value attributable to the
risks being hedged. This net carrying value differs to the swap's fair value
depending on movements in the Group's credit risk and cross-currency basis.
The carrying value of the fixed rate Eurobond net of the cross-currency
interest rate swap at 31 March 2022 was £380 million. This value does not
include capitalised set-up costs incurred in the issuing of the bond.

(4). In October 2016 easyJet plc issued a €500 million bond under the
£3,000 million Euro Medium Term Note Programme guaranteed by easyJet Airline
Company Limited. The Eurobond is for a seven year term and pays an annual
fixed coupon of 1.125%. Shortly after the issuance of the €500 million bond
the Group entered into three cross-currency interest rate swaps to convert the
entire €500 million fixed rate Eurobond to a Sterling fixed rate exposure.
The cross-currency interest rate swaps were executed on 8 November 2016 with
settlement and notional exchange occurring on 14 November 2016. All three
swaps pay fixed interest semi-annually, receive fixed interest annually, and
have maturities matching the Eurobond. The Group designated all three
cross-currency interest rate swaps as a cash flow hedge of the currency risk
on the €500 million Eurobond. The cross-currency interest rate swaps are
measured at fair value with the effective portion taken through the statement
of comprehensive income. The element of the fair value generated by the change
in the spot rate is recycled to the income statement from the statement of
comprehensive income to offset the revaluation of the Eurobond. The carrying
value of the fixed rate Eurobond net of the cross-currency interest rate swap
at 31 March 2022 was £440 million. This value does not include capitalised
set-up costs incurred in the issuing of the bond.

(5). In June 2019 easyJet plc issued a €500 million bond under the £3,000
million Euro Medium Term Note Programme guaranteed by easyJet Airline Company
Limited. The Eurobond is for a six year-term and pays an annual fixed coupon
of 0.875%. At the same time the Group entered into three cross-currency
interest rate swaps to convert the entire €500 million fixed rate Eurobond
to a Sterling fixed rate exposure. All three swaps pay fixed interest
semi-annually, receive fixed interest annually, and have maturities matching
the Eurobond. The Group designated all three cross-currency interest rate
swaps as a cash flow hedge of the currency risk on the €500 million
Eurobond. The cross-currency interest rate swaps are measured at fair value
with the effective portion taken through the statement of comprehensive
income. The element of the fair value generated by the change in the spot rate
is recycled to the income statement from the statement of comprehensive income
to offset the revaluation of the Eurobond. The carrying value of the fixed
rate Eurobond net of the cross-currency interest rate swap at 31 March 2022
was £440 million. This value does not include capitalised set-up costs
incurred in the issuing of the bond.

(6) In March 2021 easyJet FinCo B.V. issued a €1,200 million bond under the
£3,000 million Euro Medium Term Note Programme guaranteed by easyJet Airline
Company Limited and easyJet PLC. The Eurobond is for a seven-year term and
pays an annual fixed coupon of 1.875%. As at the period end this was not
hedged.

(7) In January 2021 easyJet entered into a new five-year term loan facility of
$1.87 billion underwritten by a syndicate of banks and supported by a partial
guarantee from UK Export Finance under their Export Development Guarantee
scheme. easyJet drew down $1.05 billion from the UKEF backed facility in
January 2021, utilising these funds to repay and cancel the fully drawn $500
million Revolving Credit Facility and repaying term loans of $245 million and
£200 million.

Fair value calculation methodology

Where available the fair values of financial instruments have been determined
by reference to observable market prices where the instruments are traded.
Where market prices are not available, the fair value has been estimated by
discounting expected future cash flows at prevailing interest rates and by
applying year end exchange rates (excluding The Airline Group Limited equity
investment).

The fair values of the four Eurobonds are classified as level 1 of the IFRS 13
'Fair Value Measurement' fair value hierarchy (valuations taken as the closing
market trade price for each respective Eurobond as on 31 March 2022). Apart
from the equity investment, the remaining financial instruments for which fair
value is disclosed in the table above, and derivative financial instruments,
are classified as level 2.

The fair values of derivatives are calculated using observable market forward
curves (e.g. forward foreign exchange rates, forward interest rates or forward
jet fuel prices) and discounted to present value using risk free rates. The
impacts of counterparty credit, cross currency basis and market volatility are
also included where appropriate as part of the fair valuation.

The equity investment is classified as level 3 due to the use of forecast cash
flows not based on observable market data, which are discounted to present
value. The fair value is assessed at each reporting date based on the
discounted cash flows. If the level 3 forecast cash flows were 10% higher or
lower the fair value would not increase / decrease by a significant amount.

The fair value measurement hierarchy levels have been defined as follows;

•Level 1, fair value of financial instruments based on quoted prices
(unadjusted) in active markets for identical assets or liabilities.

•Level 2, fair value of financial instruments in an active market (for
example, over the counter derivatives) which are determined using valuation
techniques which maximise the use of observable market data and rely as little
as possible on entity specific estimates.

•Level 3, fair value of financial instruments that are not based on
observable market data (i.e. unobservable inputs).

 

11. Reconciliation of operating loss to cash generated from/(used in)
operations

                                                                         Six months ended      Six months ended
                                                                         31 March 2022         31 March 2021
                                                                         £ million             £ million
 Operating loss                                                          (499)                 (601)

 Adjustments for non-cash items:
 Depreciation                                                            265                   204
 Amortisation of intangible assets                                       12                    11
 Loss on disposal of property, plant and equipment and intangibles       4                     3
 Loss/(gain) on sale and leaseback                                       21                    (60)
 Share-based payments                                                    10                    8

 Changes in working capital and other items of an operating nature:
 (Increase)/decrease in trade and other receivables                      (133)                 31
 Increase in current intangible assets                                   (86)                  (88)
 Decrease in trade and other payables                                    (9)                   (448)
 Increase in unearned revenue                                            934                   48
 Increase/(decrease) in post-employment benefit contribution             5                     (6)
 Decrease in provisions                                                  (75)                  (71)
 Decrease/(increase) in other non-current assets                         86                    (4)
 Decrease in derivative financial instruments                            55                    (144)
 Decrease in non-current deferred income                                 -                     (1)
 Cash generated from/(used in) operations                                590                   (1,118)

12. Government Grants and assistance

In the period, the Group utilised schemes provided by governments in Germany,
France and Switzerland whereby employees designated as being 'furloughed
workers' are eligible to have a portion of their wage costs recovered.

The total amount of such relief received by the Group in the period amounted
to £8 million (H1 2021: £73 million) and is offset within employee costs in
the Income statement. There are no unfulfilled conditions or contingencies
relating to these schemes.

On 6 April 2020, easyJet issued a commercial paper through the Covid Corporate
Finance Facility (CCFF) implemented by the government of the United Kingdom.
Under the CCFF, easyJet received £600 million, with interest incurred at the
prevailing market rate. In the previous financial year easyJet repaid £300
million with the remaining £300 million repaid in November 2021.

13. Contingent liabilities and commitments

easyJet is involved in a number of disputes and litigation which arose in the
normal course of business. Where cases have proceeded to a point that an
estimation of a probable liability can be reasonably estimated, a provision is
recognised (note 9). However, the likely outcome of many disputes and
litigation cannot be predicted, and in complex cases reliable estimates of any
potential obligation may not be possible.

On 19 May 2020, easyJet announced that it had been the target of a
cyber-attack from a highly sophisticated source. The email addresses and
travel details of approximately 9 million customers were accessed and for a
very small subset of customers (2,208), credit card details were accessed.

The cyber-attack continues to be under investigation by the Information
Commissioner's Office (ICO). As the cyber-attack took place before the United
Kingdom left the European Union, the Group expects the ICO to be investigating
on behalf of all EU data protection authorities as lead supervisory authority
under the GDPR. Any penalty or enforcement action will need to be reviewed and
approved by the other EU data protection authorities under the GDPR's
cooperation process. In addition, in May 2020, a class action claim was filed
in the UK High Court by a law firm representing a class of affected customers
and claims have also been commenced or threatened in certain other courts and
jurisdictions.

The merit, likely outcome and potential impact on the Group of the continued
investigation by the ICO, group action and other claims are still subject to a
number of significant uncertainties and therefore the Group is unable to
assess the likely outcome or quantum of the claims as at the date of these
financial statements.

At 31 March 2022 easyJet had outstanding letters of credit and performance
bonds totalling £72 million (H1 2021: £72 million), of which £40 million
(H1 2021: £43 million) expires within one year. The fair value of these
instruments at each period end was negligible.

No amount is recognised in the statement of financial position in respect of
any of these financial instruments as it is not probable that there will be an
outflow of resources.

As part of the commitment to voluntary carbon offsetting, easyJet currently
has contractual commitments to purchase Verified Emission Reductions worth £6
million (H1 2021: £22 million) in total over the next year.

At 31 March 2022, easyJet has a capital commitment to purchase two engines for
£19 million by December 2022.

14. Related party transactions

The Company licenses the easyJet brand from easyGroup Ltd ('easyGroup'), a
wholly owned subsidiary of easyGroup Holdings Limited, an entity in which
easyJet's founder, Sir Stelios Haji-Ioannou, holds a beneficial controlling
interest. The Haji-Ioannou family concert party shareholding (being easyGroup
Holdings Limited and Polys Holding Limited) holds, in total, approximately
15.27% of the issued share capital of easyJet plc as at 31 March 2022.

Under the Amended Brand Licence signed in October 2010 and approved by the
shareholders of easyJet plc in December 2010, an annual royalty of 0.25% of
total revenue is payable by easyJet to easyGroup. The full term of the
agreement is 50 years.

easyJet and easyGroup have established a fund to meet the annual costs of
protecting the 'easy' (and related marks) and the 'easyJet' brands. easyJet
contributes up to £1 million per annum to this fund and easyGroup contributes
£100,000 per annum. If easyJet contributes more than £1 million per annum,
easyGroup will match its contribution in the ratio of 1:10 up to a limit of
£5 million contributed by easyJet and £500,000 contributed by easyGroup.

Three side letters have been entered into: (i) a letter dated 29 September
2016 in which easyGroup consented to easyJet acquiring a portion of the equity
share capital in Founders Factory Limited; (ii) a letter dated 26 June 2017 in
which easyJet's permitted usage of the brand was slightly extended; and (iii)
a letter dated 02 February 2018 in which easyGroup agreed that certain
affiliates of easyJet have the right to use the brand.

The amounts included in the income statement, within other costs, for these
items were as follows:

                                                                          Six months ended    Six months ended
                                                                          31 March 2022       31 March 2021
                                                                          £ million           £ million
 Royalty                                                                  3.6                 0.1
 Brand protection (legal fees paid through easyGroup to third parties)    -                   0.1
                                                                          3.6                 0.2

As at 31 March 2022, £1.9 million net payable (H1 2021: £4.6 million net
receivable) of related party balances were held in trade and other receivables
and payables.

15. Events after the balance sheet date

On 7 April 2022, $100 million of the UK Export Finance backed facility was
repaid. This relates to the Commercial Paper (UK Export Finance) disclosed in
note 8.

Glossary: Alternative Performance Measures

Non-headline items

Non-headline items are those where, in management's opinion, their separate
reporting provides an additional understanding to users of the financial
statements of easyJet's underlying trading performance, and which are
significant by virtue of their size and/or nature (see Note 3).

Headline loss before Tax

A measure of underlying performance which is not impacted by non-headline
items.

 

                                                   Six months ended          Six months ended
                                                              31 March 2022             31 March 2021
                                                              £ million                 £ million
 Statutory loss before tax                                    (557)                     (645)
 Total non-headline charge/ (credit) (see note 3)             12                        (56)
 Headline loss before tax                                     (545)                     (701)

 

EBITDAR

Earnings before interest, taxes, depreciation, amortisation and aircraft
rental.

Headline EBITDAR

Earnings before non-headline items, interest, taxes, depreciation,
amortisation and aircraft rental.

                                                                    Six months ended          Six months ended
                                                                               31 March 2022             31 March 2021
                                                                               £ million                 £ million
 Statutory operating loss                                                      (499)                     (601)
 Add back;
 Aircraft dry leasing                                                          1                         2
 Depreciation                                                                  265                       204
 Amortisation                                                                  12                        11
 EBITDAR                                                                       (221)                     (384)
 Non-headline charge/(credit) within operating profit (see note 3)             13                        (85)
 Headline EBITDAR                                                              (208)                     (469)

 

Net debt

Total cash less borrowings and lease liabilities. (Cash includes money market
deposits but excludes restricted cash).

                                                                 31 March 2022      31 March 2021
                                                                 £ million          £ million
 Borrowings                                                      3,046              3,323
 Lease liabilities                                               1,055              1,027
 Cash and money market deposits (excluding restricted cash)      (3,505)            (2,335)
 Net Debt                                                        596                2,015

 

Return on Capital employed (ROCE)

Operating profit, less tax at the prevailing UK corporation tax rate at the
end of the financial year, divided by average capital employed (shareholder
equity less net cash/debt).

Headline return on capital employed (ROCE)

Operating profit less non-headline items, less tax at the prevailing UK
corporation tax rate at the end of the financial year, divided by average
capital employed (shareholder equity less net cash/debt).

                                   31 March 2022      31 March 2021
                                   £ million          £ million
 Opening shareholder's equity      2,639              1,899
 Closing shareholder equity        2,440              1,582
 Average shareholder equity        2,540              1,741

 Opening net Debt                  910                1,125
 Closing net det                   596                2,015
 Average net debt                  753                1,570
 Average capital employed          3,293              3,311

 

 Reported operating loss                  (499)        (601)
 Tax rate                                 19%          19%
 Normalised operating loss after tax      (404)        (487)
 Return on capital employed               (12.3%)      (14.7%)

 

 Reported operating loss                                              (499)        (601)
 Non-headline charge/(credit) within operating loss (see note 3)      13           (85)
 Headline reported operating loss                                     (486)        (686)
 Tax rate                                                             19%          19%
 Normalised headline operating loss after tax                         (394)        (556)
 Headline return on capital employed                                  (12.0%)      (16.8%)

 

Basic headline loss per share - pence

Total headline loss for the year divided by the weighted average number of
shares in issue during the year after adjusting for shares held in employee
benefit trusts.

Diluted headline loss per share - pence

Diluted headline loss per share, the weighted average number of ordinary
shares in issue is adjusted to assume conversion of all dilutive potential
shares.

                                                   Six months ended          Six months ended
                                                              31 March 2022             31 March 2021
                                                              £ million                 £ million
 Statutory loss after tax                                     (431)                     (549)
 Total non-headline charge/ (credit) (see note 3)             12                        (56)
 Tax impact on non-headline items                             (3)                       30
 Headline loss                                                (422)                     (575)

 

                                                                                    million      million
                                                                                                 restated

                                                                                                 (see note 5)
 Weighted average number of ordinary shares used to calculate basic loss per        754          538
 share
 Weighted average number of ordinary shares used to calculate diluted loss per      754          538
 share

 

 Headline loss per share      pence       pence
                                          restated
 Basic                        (56.0)      (106.9)
 Diluted                      (56.0)      (106.9)

 

Constant currency measures

These performance measures are calculated by translating the H1 2022 financial
period performance at the H1 2021 financial period effective exchange rate,
excluding foreign exchange gains and losses in the statement of financial
position. The purpose of this APM to give insight on performance by comparing
metrics on a constant currency basis thereby excluding the impact of exchange
rate movements.

Statement of Directors' responsibilities

The Directors are responsible for preparing the interim report in accordance
with applicable law and regulations. The Directors confirm that the condensed
consolidated interim financial information has been prepared in accordance
with UK adopted International Accounting Standard 34, 'Interim Financial
Reporting' and the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority.

The interim management report includes a fair review of the information
required by the Disclosure and Transparency Rules paragraphs 4.2.7 R and 4.2.8
R, namely:

·    an indication of important events that have occurred during the six
months ended 31 March 2022 and their impact on the condensed set of financial
information, and a description of the principal risks and uncertainties for
the remaining six months of the financial year; and

·    material related-party transactions during the six months ended 31
March 2022 and any material changes in the related-party transactions
described in the Annual report and Accounts 2021.

The Directors of easyJet plc are listed in the Annual report and Accounts
2021. A list of current Directors is maintained on the easyJet plc website:
http://corporate.easyJet.com (http://corporate.easyJet.com) and includes
Stephen Hester who became Chair on 1 December 2021.

The Directors are responsible for the maintenance and integrity of, amongst
other things, the financial and corporate governance information as provided
on the easyJet website (http://corporate.easyJet.com). Legislation in the
United Kingdom governing the preparation and dissemination of financial
information may differ from legislation in other jurisdictions.

The interim report was approved by the Board of Directors and authorised for
issue on 18 May 2022 and signed on its behalf by:

 Johan Lundgren   Alistair Kenton Jarvis
 Chief Executive  Chief Financial Officer

 

Independent review report to easyJet plc

Report on the condensed consolidated interim financial statements

Our conclusion

We have reviewed easyJet plc's condensed consolidated interim financial
statements (the "interim financial statements") in the interim report of
easyJet plc for the 6 month period ended 31 March 2022 (the "period").

Based on our review, nothing has come to our attention that causes us to
believe that the interim financial statements are not prepared, in all
material respects, in accordance with UK adopted International Accounting
Standard 34, 'Interim Financial Reporting' and the Disclosure Guidance and
Transparency Rules sourcebook of the United Kingdom's Financial Conduct
Authority.

The interim financial statements comprise:

·    the condensed consolidated statement of financial position as at
31 March 2022;

·    the condensed consolidated income statement and condensed
consolidated statement of comprehensive income for the period then ended;

·    the condensed consolidated statement of cash flows for the period
then ended;

·    the condensed consolidated statement of changes in equity for the
period then ended; and

·    the explanatory notes to the interim financial statements.

 

The interim financial statements included in the interim report of easyJet plc
have been prepared in accordance with UK adopted International Accounting
Standard 34, 'Interim Financial Reporting' and the Disclosure Guidance and
Transparency Rules sourcebook of the United Kingdom's Financial Conduct
Authority.

What a review of interim financial statements involves

We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information
Performed by the Independent Auditor of the Entity' issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures.

A review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing (UK) and, consequently, does not
enable us to obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do not express
an audit opinion.

We have read the other information contained in the interim report and
considered whether it contains any apparent misstatements or material
inconsistencies with the information in the interim financial statements.

Responsibilities for the interim financial statements and the review

Our responsibilities and those of the directors

The interim report, including the interim financial statements, is the
responsibility of, and has been approved by the directors. The directors are
responsible for preparing the interim report in accordance with the Disclosure
Guidance and Transparency Rules sourcebook of the United Kingdom's Financial
Conduct Authority.

Our responsibility is to express a conclusion on the interim financial
statements in the interim report based on our review. This report, including
the conclusion, has been prepared for and only for the company for the purpose
of complying with the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority and for no other purpose. We
do not, in giving this conclusion, accept or assume responsibility for any
other purpose or to any other person to whom this report is shown or into
whose hands it may come save where expressly agreed by our prior consent in
writing.

PricewaterhouseCoopers LLP

Chartered Accountants

Watford

19 May 2022

 

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