REG - easyJet PLC - Results for the 12 months ending 30 September 2024
27/11/2024 07:00
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RNS Number : 7860N easyJet PLC 27 November 2024
27 November 2024
easyJet plc
Results for the twelve months ending 30 September 2024
easyJet improves annual profits by 34%, achieving £610 million PBT, following
another record summer
· Strong progress towards medium term targets
- FY24 headline profit before tax of £610 million, +£155 million
YoY (Reported PBT £602 million)
- easyJet holidays recorded £190 million profit before tax, +56%
YoY
- ROCE of 16% in FY24, +3ppts YoY, strong progress towards target of
high-teen ROCE
- Group headline PBT per seat +24% YoY, achieving £6.08 per seat, a
positive step towards our £7-10 target
· Record H2 headline profit before tax of £960m, +£94m YoY
- H2 Passenger growth +7% YoY
- H2 RPS +1% YoY, (Q4 RPS +1% in line with guidance)
o H2 RASK reduced 1% YoY
- Headline H2 CPS ex fuel increased 2% (in line with guidance) &
H2 fuel CPS reduced 2% YoY
o H2 Headline CASK ex fuel increased 1% YoY, total CASK reduced 1% YoY
- Holidays H2 profit increased +42% YoY
· Positive outlook for FY25
- Expect FY25 capacity of c.103m seats, an increase of 3%
o ASK capacity growth of c.8% driven by average sector length increase of
c.5%
- Expect to reduce winter losses with a significant improvement in
Q1, with Q2 impacted by the timing of Easter.
o H1'25 ASK capacity +12% driven by average sector length growth of c.6%
o Q1'25 RASK expected to be broadly flat
o H1'25 headline CASK ex fuel expected to slightly reduce YoY
o H1'25 fuel CASK is expected to reduce by c.10%
- easyJet holidays customers planned to grow by c.25% in FY25, from
a base of 2.6m customers
· Proposed dividend: 20% of FY24 headline PAT payable in early 2025
· Continued confidence in execution of >£1bn PBT in medium-term
Johan Lundgren, easyJet's CEO, said:
"This strong performance - resulting in a 34% increase in our annual profits -
reflects the effectiveness and execution of our strategy as well as continued
popularity of our flights and holidays. It also represents a significant step
towards our goal of sustainably generating over £1 billion annual profit
before tax.
"It has been a privilege to lead easyJet for the past seven years. I am
extremely proud of all that has been achieved, which is a result of the hard
work of the entire team. I am pleased to be leaving a strong easyJet, the
future for the company is bright and I look forward to seeing Kenton
delivering his ambitious plans, generating positive shareholder returns while
making low-cost travel easy for millions of customers."
Kenton Jarvis, easyJet's CFO and CEO designate, said:
"The outlook for easyJet is positive and travel remains a firm priority with
consumers who value our low fares, unrivalled network and friendly service.
The airline will continue to grow, particularly on popular longer leisure
routes like North Africa and the Canaries and we plan to take 25% more
customers away on package holidays, as easyJet holidays continues to thrive. I
am looking forward to taking over the controls of this fantastic business in
the new year and we still have a lot to go for as we progress towards our
ambitious targets."
Overview
The execution of our strategic initiatives has seen easyJet deliver strong
earnings growth with headline profit before tax of £610 million, a 34%
increase year-on-year. The airline reduced winter losses by £40 million
through a combination of productivity and utilisation benefits. 16 new A320neo
family aircraft were delivered in the year moving the average gauge from 179
to 181, driving cost efficiencies of c.£25 million. easyJet holidays achieved
a PBT of £190 million driven by a growth in customer numbers of 36%. Overall
this has resulted in achieving a ROCE of 16% in FY24, a strong improvement
from the 13% in FY23. These results represent a positive momentum towards our
target to sustainably generate over £1 billion profit before tax.
Shareholder returns
The Board is recommending an ordinary dividend of 12.1 pence per share (2023:
4.5 pence), amounting to £92 million (2023: £34 million) subject to
shareholder approval at the upcoming Annual General Meeting. This will be paid
on 21 March 2025 to those shareholders on the register at the close of
business on 21 February 2025. This represents 20% of the headline profit after
tax.
The Board is committed to maintaining regular returns to shareholders through
this ordinary dividend. Future returns of excess capital will continue to be
assessed, taking into account market conditions, capex requirements and
progress towards the Group's medium-term targets. The Board remains focussed
on delivering attractive returns on capital employed for shareholders.
ESG
We are the best ESG rated European airline from Sustainalytics (score of 21.4)
and MSCI (AA rating). We hold a best in class rating from CDP (A-) and we also
retained our position in FTSE4Good for a second year running. The efficiencies
which we have ahead of us will only strengthen this position.
Capacity
During Q4 easyJet flew 30.0 million seats, a 5% increase on the same period
last year when easyJet flew 28.6 million seats. Load factor was 92% (Q4 FY23:
92%). Passenger numbers in the quarter increased to 27.7 million (Q4 FY23:
26.2 million).
Capacity for the full year increased by 8% to 100.4 million seats. In the year
easyJet has flown 6.9 million more passengers than in FY23.
July Aug Sept Q4 Q4
2024 2024 2024 FY24 FY23 FY24 FY23
Number of flights 55,915 56,265 54,807 166,987 160,445 558,960 519,426
Peak operating aircraft 333 333 333 333 319 333 319
Passengers (thousand) 9,380 9,457 8,842 27,679 26,188 89,684 82,754
Seats flown (thousand) 10,048 10,117 9,842 30,007 28,591 100,448 92,619
Load factor 93.4% 93.5% 89.8% 92.2% 91.6% 89.3% 89.3%
Q4'24 Q4'23 FY24 FY23 Change
favourable/(adverse)
Passenger revenue (£'m) 2,068 1,970 5,715 5,221 9%
Airline ancillary revenue (£'m) 851 786 2,457 2,174 13%
Holidays revenue(1) (£'m) 490 366 1,137 776 47%
Group revenue (£'m) 3,409 3,122 9,309 8,171 14%
Fuel costs (£'m) (684) (675) (2,223) (2,033) (9)%
Airline headline EBITDA costs ex fuel (£'m) (1,385) (1,314) (4,754) (4,347) (9)%
Holidays EBITDA costs(1) (£'m) (411) (306) (965) (661) (46)%
Group headline EBITDA costs (£'m) (2,480) (2,295) (7,942) (7,041) (13)%
Group headline EBITDA (£'m) 929 827 1,367 1,130 21%
Airline depreciation & amortisation (£'m) (225) (159) (762) (649) (17)%
Holidays depreciation & amortisation (£'m) (2) (2) (8) (5) (60)%
Group headline EBIT (£'m) 702 666 597 476 25%
Airline financing costs excluding balance sheet revaluations (£'m) 8 (15)
2 (59) 75%
Holidays financing costs (£'m) 9 5 26 12 117%
Airline balance sheet revaluations (£'m) 5 (10) 2 26 (92)%
Group headline PBT (£'m) 724 663 610 455 34%
Airline passenger revenue per seat (£) 68.91 68.90 56.90 56.37 1%
Airline ancillary revenue per seat (£) 28.38 27.51 24.45 23.47 4%
Total airline revenue per seat (£) 97.29 96.41 81.35 79.84 2%
Total airline RASK (p) 7.61 7.67 6.65 6.52 2%
Airline headline cost per seat ex fuel (£) (53.23) (51.84) (55.03) (54.30) (1)%
Airline headline CASK ex fuel (p) (4.16) (4.12) (4.50) (4.44) (1)%
Airline fuel cost per seat (£) (22.79) (23.60) (22.14) (21.95) (1)%
Fuel CASK (p) (1.78) (1.88) (1.81) (1.79) (1)%
Airline headline total cost per seat (£) (76.02) (75.44) (77.17) (76.25) (1)%
Airline headline total CASK (p) (5.95) (6.00) (6.31) (6.23) (1)%
Available seat kilometres (ASK) (millions) 38,355 35,960 122,885 113,334 8%
Average sector length (km) 1,278 1,258 1,223 1,224 0%
Cash and money market deposits (£'bn) 3.5 2.9 21%
Net cash (£'m) 181 41 341%
ROCE 16% 13% 3ppt
Headline earnings per share (p) 61.3 45.4 35%
Outlook
· Expect to reduce winter losses with a significant improvement in Q1,
with Q2 impacted by the timing of Easter and a prior year release of aged
balances.
· Bookings and RASK
- Q1'25 is 80% sold, +2ppts year on year and we expect RASK to be
broadly flat year-on-year.
- Q2'25 is 26% sold, +2ppts year on year against headwinds from the
timing of Easter (moving into Q3'25) and the prior year release of c.£34m
aged balances (these two combined are worth c. 4ppts of RASK reduction YoY)
· H1'25 CASK
- Headline CASK ex fuel is expected to slightly reduce, due to
productivity and utilisation benefits.
- Fuel CASK is expected to reduce by c. 10% in H1'25
· Capacity growth expected to be c.3% in FY25.
- FY25 ASK capacity growth expected to be c.8%
o Average sector length expected to increase by c.5%
- H1'25 is expected to have c.45 million seats, +6% year on year
o ASK capacity growth expected to be c.12%
o Average sector length will increase by c.6% as we continue to increase
capacity into winter sun destinations such as North Africa and the Canary
Islands
- H2'25 is expected to have c.58 million seats, +1% year-on-year
o ASK capacity growth expected to be c.5%
o An increase in average sector length of c. 5% is expected
· easyJet holidays customers planned to grow by c.25% in FY25, from a
base of 2.6m customers
- H1'25 is 82% sold
Fuel & FX Hedging
Jet Fuel H1'25 H2'25 H1'26 USD H1'25 H2'25 H1'26
Hedged position 80% 59% 24% Hedged position 75% 53% 26%
Average hedged rate ($/MT) 808 771 761 Average hedged rate (USD/GBP) 1.26 1.28 1.29
Current spot ($/MT) at 25.11.24 c.740 Current spot (USD/GBP) at 25.11.24 1.26
- Carbon obligation including free allowances
o 100% covered for CY24 at €48/MT
o 96% covered for CY25 at €43/MT
- USD Lease payments hedged for the next three years at 1.26
- Capex hedged for the next 12 months in EUR & USD
For further details please contact easyJet plc:
Institutional investors and analysts:
Adrian Talbot Investor
Relations +44 (0) 7971
592 373
Media:
Anna Knowles Corporate Communications
+44 (0) 7985 873 313
Olivia Peters Teneo
+44 (0) 20 7353 4200
Harry Cameron Teneo
+44 (0) 20 7353 4200
Conference call
There will be an analyst presentation at 09:30am GMT on 27 November 2024 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://brrmedia.news/EZJ_FY_24 (https://brrmedia.news/EZJ_FY_24)
Alternatively dial in details are as follows: +44 (0) 33 0551 0200 quoting
'easyJet FY24' when prompted.
Balance Sheet
easyJet continues to have one of the strongest investment grade balance sheets
in European Aviation (Baa2, stable, by Moody's and BBB, positive, by Standard
& Poor's). As at 30 September 2024 our net cash position was £181 million
(30 September 2023: £41 million). The strength of our balance sheet will
support future fleet growth and modernisation which is planned to deliver
profitable growth, upgauging and attractive shareholder returns.
During the year easyJet repaid a €500 million Eurobond which matured in
October 2023 and then on 20 March 2024 easyJet issued an €850 million bond
with a coupon of 3.75%, maturing in 2031.
Revenue
Total revenue increased by 14%, reaching £9,309 million (£8,171 million in
2023). This was primarily due to an increase of 8% in capacity to 100.4
million seats (92.6 million in 2023), the continued growth of easyJet holidays
and total per seat pricing strength.
Passenger revenue increased by 9% to £5,715 million, up from £5,221 million
in 2023, as we operated with higher capacity compared to the prior financial
year. Passenger Revenue Per Seat (RPS) also slightly increased by 1% since the
prior year to £56.90 (£56.37 in 2023). This growth is as a result of
easyJet's optimised network at primary airports driving increased yields.
Group ancillary revenue increased by 22% to £3,594 million (2023: £2,950
million) as airline capacity and pricing increased alongside the continued
growth of easyJet holidays (customers +36% YoY). Airline ancillary revenue per
seat increased by 4% to £24.45 (2023: £23.47) as easyJet's embedded
ancillary products continue to see enhanced revenue generation through price
optimisation.
Costs
Group headline costs, excluding fuel, rose by 14% to £6,476 million, up from
£5,683 million in 2023. This increase is attributed to higher capacity and
the continued growth of easyJet holidays.
Headline Airline cost per seat (CPS), excluding fuel, saw a marginal increase
of 1% to £55.03 from £54.30 in 2023. Disruption costs were much improved
during the year with a significant reduction in events offset by inflationary
pressures.
Fuel CPS increased by 1% with rising fuel prices seen in the first half of the
year alongside a reduction in free ETS allowances being partially offset by
lower fuel costs in the second half.
Financing costs benefitted from a decrease in gross debt and a rise in the
interest rate on floating-rate cash deposits. Foreign exchange movements over
the period resulted in a non-operational, non-cash FX gain of £2 million from
balance sheet revaluations.
Non-Headline Items
Non-headline items are those where, in management's opinion, 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. These costs are separately
disclosed and further detail can be found in the notes to the financial
statements. This year saw a non-headline cost of £8 million (2023: £23
million cost) primarily due to restructuring costs for France and Italy.
Fleet
easyJet's total fleet as at 30 September 2024 comprised 347 aircraft (30
September 2023: 336 aircraft). The increase was driven by:
· Acquisition of 16 new neo family aircraft.
· Delivery of eight mid-life A320 leased aircraft.
Thirteen older leased aircraft exited the fleet at the end of their lease-term
(all A319 aircraft), as easyJet continues its journey of retiring older, less
efficient aircraft, whilst benefitting from the A320neo family aircraft with
their superior fuel efficiency and greater number of seats.
easyJet already has 85 A320neo family aircraft within its fleet. It also has
an existing order book with Airbus to FY34 for a further 299 A320neo family
aircraft which are still to be delivered alongside 100 purchase rights. This
provides easyJet with the ability to complete its fleet replacement programme
of A319 aircraft and replace approximately half of the A320ceo aircraft,
alongside providing the foundation for disciplined growth.
The average age of the fleet increased to 10.2 years (30 September 2023: 9.9
years). The average gauge of the fleet is currently 181 seats per aircraft (30
September 2023: 179 seats). Fleet as at 30 September 2024;
Owned Leased Total % of fleet Changes since Sep-23 Firm
Orders
A319 18 64 82 23% (13) -
A320 103 77 180 52% 8 -
A320neo 62 7 69 20% 15 131(a)
A321neo 5 11 16 5% 1 168(a)
188 159 347 11 299
Percentage of total fleet 54% 46%
a) easyJet retains the option to alter the aircraft type of future
deliveries, subject to providing sufficient notification to the OEM
Our flexible fleet plan allows us to expand or contract the size of the fleet
depending on the demand outlook. easyJet retains the ability to utilise its
existing fleet of A319 aircraft to maintain its base fleet plan despite FY26 -
FY28 deliveries being reduced.
Number of aircraft FY25 FY26 FY27 FY28
Current fleet plan 356 368 381 395
Current contractual minimum 356 367 353 344
New aircraft deliveries 9 17 30 43
Gross capital expenditure (£'m) c.1,200 c.1,700 c.2,300 c.3,300
Capex is comprised of new fleet delivery payments, maintenance related
expenditure, lease payments and other capital expenditure such as IT
development.
FY25 excludes three wet lease aircraft from the Lufthansa Group. This
agreement is part of being the proposed short-haul remedy taker at Linate
& Rome Fiumicino
Strategy
easyJet's purpose is to make low-cost travel easy. Our strategy is built
around four key priorities that leverage our structural benefits in the
European aviation market. These strategic initiatives guide easyJet towards
its goal of becoming Europe's most loved airline, delivering value for our
customers, shareholders, and people. The details of our strategic priorities
are as follows:
· Building Europe's best network
· Transforming our revenue capability
· Driving our low-cost model
· Delivering ease and reliability
Building Europe's best network
easyJet has a strong network of leading number one and number two positions in
primary airports, which has proven to be the most appealing to customers and
therefore 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 and returns. During the year we
have launched our new Birmingham and Alicante bases which are performing well,
delivering profitable returns in their first summer. Our tenth UK base at
London Southend will open in Summer 2025, where we are already seeing strong
bookings ahead of the network average. We also announced the proposal to close
our Toulouse and Venice bases during winter 2025 as we focus on driving an
attractive return on capital across the network. We will continue to fly to
both cities as destinations.
We seek to further strengthen our position in key markets as the competitive
landscape evolves and becomes more constrained. We are pleased to have been
proposed as the short-haul remedy taker to operate slots at Milan Linate and
Rome Fiumicino, which gives us a one-off opportunity at these high yielding
slot-constrained airports and allowing diversification in the EU. These new
bases are planned to open in Summer 2025 with a combined 8 aircraft.
easyJet will continue its growth in FY25 with targeted winter growth to drive
further winter loss reductions. This will see an increase in sector length of
c.6% as we grow frequencies into North Africa and the Canary Islands, serving
strong customer demand. New routes for 2025 include winter sun destinations
such as Luxor and Cape Verde as well as further expanding our city offering to
Tromsø, Salzburg, Oslo and Derry, allowing customers to experience the
Northern lights and Christmas markets.
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 and as a result have superior demand and yield
characteristics. 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 a market
leading network and schedule.
2. 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.
Transforming revenue
easyJet recognises that the continued evolution of our product portfolio
represents a significant opportunity to better meet our customers preferences
and build on spend per passenger and deliver enhanced sustainable returns.
Airline Ancillaries:
Cabin bags and our leisure bundles, amongst other ancillary products, have
continued to deliver incremental revenue through the period, benefitting from
positive yields achieved by price optimisation. Alongside this, easyJet's
inflight retail proposition has seen profit per seat increase by 13% compared
to the equivalent period in 2023. This was driven by an increase in spend per
head of 12% and increased conversion of 1 percentage point. These initiatives
have contributed to the Airline's ancillary RPS being 4% higher than the same
period in 2023.
easyJet holidays:
easyJet holidays continued its expansion with 36% customer growth in the year
and 56% profit growth to £190 million year on year, taking its UK market
share from 5% to 7%, executing strong progress towards the medium-term target
of over £250 million PBT. This growth is being delivered through strong
customer satisfaction of 84%, with 82% of customers likely to re-book.
As the holidays business grows in scale, targeted investments will be made to
strengthen the customer base. Future initiatives are underway to optimise
pricing and increase the attachment rate, such as improving the city
proposition, alongside enhancing the product offering through dynamic
inventory and further ancillary products.
Our multi-currency technology platform enables expansion into other source
markets, as demonstrated through the launch of our Swiss, French and German
markets.
Moving into FY25, easyJet holidays plans to grow its passenger numbers by c.
25%.
Delivering ease and reliability
easyJet has a loyal customer base, with 75% of seats booked by returning
customers. Customer satisfaction of 76% improved by 3 percentage points YoY as
our crew provide our customers with the warmest onboard experience.
easyJet aims to deliver a seamless and digitally enabled customer journey at
every stage and is continuously working to enhance the customer experience.
The focus areas to deliver ease in the customer experience are:
· Communications: providing helpful and timely information flows and
creating cohesion across the end-to-end experience. Use of technology and data
to improve levels of first time query resolution, productivity and customer
satisfaction.
· Airport journey: improving the airport experience by optimising core
processes including boarding and bag drop, for example by providing twilight
check-in at more airports and the application of technology enhancements such
as biometric automation to reduce queuing.
· Inflight offering: creating a more personalised service enabled
through the use of connected technology and enhancing the current crew's
engagement.
· Disruption management: focusing on improvements to streamline
policies, simplify processes and automate solutions, alongside more efficient
communications via connected devices.
· Enabled front line staff: ensuring staff have timely operational
information to better serve customers.
easyJet also aims to deliver reliable performance through:
· Process oversight: a focus on base driven reporting, with station
level ownership and control.
· Prior to departure: optimising planning activities such as standby
allocation.
· On the day turn execution: key to delivery, with elements including
supply chain, event communications management, hand luggage policies and
inventory optimisation.
As a result of easyJet's targeted resilience actions, we have seen OTP improve
3 percentage points year-on-year, despite the worsening ATC environment. We
are focused on continuing this performance into next year.
Driving our low-cost model
easyJet has a cost advantage over its major competitors on the primary network
that it operates. Alongside cost actions, easyJet is focused on margin through
its network optimisation, effective pricing management and ancillaries driving
higher yields.
Our focus on increased productivity and utilisation offset inflationary cost
pressure in the first half of the 2024 financial year, which resulted in a
reduction of £61 million in winter losses. Inflationary cost pressures over
the year were materially offset by greater productivity and utilisation,
alongside the benefits of upgauging coming through from the 16 new aircraft
delivered during the year.
Maintaining our cost discipline is a core focus for the business, with cost
benefits to come through the following initiatives:
· Purchase of an established heavy base maintenance facility in Malta:
enabling easyJet to have greater control over maintenance, reducing costs
incurred and improving the quality of maintenance fulfilled.
o Expect c.25% of easyJet's heavy maintenance will be carried out here
· Increasing automation of self-service management: increasing
digitalisation of customer flows and reducing the need for contact centre
support.
o 68% of customers' queries are now served via live chat, an increase of 46
ppts year on year
· Use of data and automation to drive efficiency: Predictions from
SkySYM have allowed flexibility in resilience measures to be built into the
schedules for the summer 2025 season.
· Increased productivity and utilisation: Further seat capacity growth
and increased sector length in FY25 to drive productivity and cost savings.
· Upgauging of the fleet: efficiency benefits will be unlocked as A319s
leave the fleet, being replaced by A320neo family aircraft. This will enable
us to unlock efficiency benefits, increasing the average gauge from 181 to the
low 190s by FY28 and the low 200s by FY34. The increased mix of NEO aircraft
will see additional fuel and airport incentive benefits as easyJet's order
book of 299 A320neo family aircraft enter the fleet.
Sustainability
Our net zero roadmap is key to helping us lower the environmental impact of
aviation and we are on track to meet our SBTi-validated 'interim' carbon
target of 35% intensity reduction by 2035. We remain focused on the
three-pronged approach to our net zero roadmap; reduce, replace and remove. We
have reduced our emissions intensity by 0.9% year on year. Nearly a quarter of
our fleet is comprised of the highly efficient NEO aircraft and we have
completed the Descent Profile Optimisation (DPO) retrofit which will save
88,600 tonnes of CO2 each year. Looking forward, to reduce emissions further
we have operated IRIS satellite-based datalink technology, a tool to progress
modernising air traffic management, and announced our new partnership with
JetZero, supporting the development of its ultra-efficient blended wing
solution.
Our continued partnership with Rolls-Royce, within the Hydrogen in Aviation
Alliance, allows us to progress with hydrogen research to develop jet fuel
replacement technologies. Finally in terms of removal and Direct Air Carbon
Capture & Storage (DACCS), we were the first airline to sign up to
Airbus's carbon removal initiative with 1PointFive.
easyJet holidays is working to maximise the socio-economic benefits of tourism
to destination communities, while managing environmental impacts of hotel
tourism and we continue to reduce our operational waste. This year, we
introduced reusable cups and cutlery for all in-flight crew meals, an
initiative that will prevent 10 million single-use items from being wasted
every year.
Our People
easyJet continues to have a market leading reputation as an employer of
choice, as evidenced by both easyJet and easyJet holidays have been named as a
'best place to work' by Glassdoor and The Sunday Times respectively. Our
people are a key source of differentiation, and this helps to deliver
excellent customer experience and loyalty. As we journey towards our
destination to be Europe's most loved airline, for our people this means being
a place to work that is loved, where diversity can thrive, learning is
encouraged and you can do your best work, thrive and grow your career.
This year we have invested £8 million into our performance shares which were
awarded to all employees, helping to retain talent and ensuring employees are
invested in our future.
Footnotes
(1) easyJet holidays numbers include elimination of intercompany airline
transactions.
OUR FINANCIAL RESULTS
A strong performance for the year characterised by capacity growth, cost
discipline and the continued success of easyJet holidays, delivering reduced
winter losses and culminating in a record summer profit.
Total headline profit before tax of £610 million for the year ended 30
September 2024 was an improvement of £155 million (34%) on the year ended 30
September 2023 equivalent profit of £455 million. Total revenue of £9,309
million was £1,138 million (14%) ahead of the prior year and Holidays' profit
before tax contribution of £190 million was £68 million ahead. The year was
characterised by increased capacity and passenger numbers with cost discipline
and operational efficiencies offsetting industry-wide inflationary pressures.
easyJet holidays played a key role in the profit growth with a 36%
year-on-year increase in customer numbers and continued strong margins.
An expansion in fleet size saw the introduction of new routes and base
openings in the year which, together with ongoing strategic network
optimisation, enabled easyJet to offer capacity of 100.4 million seats (2023:
92.6 million), an increase of 8% over the prior year. With a load factor of
89% (2023: 89%), this translated into 89.7 million passengers carried (2023:
82.8 million). Improved airline revenue per seat (RPS) performance of £81.35
(2023: £79.84) was 1.9% higher than the prior year in a competitive market,
and included contribution from the ongoing success of our airline ancillary
options and in-flight retail offer. easyJet holidays had 2.6 million customers
in the year (including agent commission customers, 2023: 1.9 million), and
surpassed £1 billion incremental revenue contribution, delivering £1,137
million revenue (2023: £776 million) and £190 million headline profit before
tax (2023: £122 million). The prior year's cost challenges for the airline
continued with industry-wide inflationary pressures again a feature. Whilst we
continued to implement resilience measures to minimise the risk and impact of
delays and cancellations, disruption and the associated costs continued to run
at too high a level, with the main causes being air traffic control (ATC)
restrictions, external industrial action and weather events. Nevertheless,
with management's focus on cost and fleet efficiency, easyJet's airline
headline cost per seat (CPS) excluding fuel of £55.03 was only 1.3% higher
than the prior year (2023: £54.30).
The first half of the financial year demonstrated a successful first step on
our journey to structurally reducing winter losses, with headline loss before
tax of £350 million for the six months ended 31 March 2024 being a reduction
of £61 million on the loss of £411 million for the comparative period ended
31 March 2023. This reflected network growth in response to customer demand,
fleet utilisation benefits and the continued expansion of easyJet holidays, in
addition to some trading benefit due to part of the Easter holidays falling in
the first half of the financial year. This was alongside the impact of the
outbreak of conflict in the Middle East which resulted in the cancellation of
a number of flying routes and the associated costs incurred and revenue
forgone. Passenger growth of 11% to 36.7 million passengers (H1 2023: 33.1
million) and RPS growth of 5% led to first-half revenue of £3,268 million (H1
2023: £2,689 million), an increase of 22%. Fuel prices remained volatile
throughout H1 with the outbreak of the conflict in the Middle East and,
although partially mitigated through easyJet's hedging policy, fuel costs on a
CPS basis increased by 6% to £21.60 (H1 2023: £20.43). However, the focus on
cost management and efficiency delivered by increased asset utilisation and
productivity resulted in easyJet's H1 2024 airline headline CPS excluding fuel
of £57.28 being flat to the comparative period (H1 2023: £57.15).
The second half of the financial year delivered a record profit before tax of
£960 million (H2 2023: £866 million). Second half trading saw continued
capacity growth, a year-on-year 0.7% RPS improvement in a competitive pricing
market, and Holidays' increased revenue contribution. This, combined with
falling fuel prices, efficiencies from scale and our management cost focus,
helped easyJet deliver a record summer result. The delivery was against a
backdrop of continued high levels of disruption, with ongoing external
industrial action and persistent ATC challenges across congested European
airspace in addition to the impact of weather events. Targeted resilience
measures and learnings from previous periods of disruption, such as providing
for breaks in scheduling at airports subject to frequent ATC disruption and
crew timing on first wave flights, improved on-time performance and our
response to these challenges. Our 'controllable' disruption events have
reduced by c. 40% compared to FY23, reflecting the resilience actions
undertaken including an investment in spare parts and standby aircraft, an
increased rigour in the timing of aircraft maintenance scheduling, and a focus
on ground staff and crew availability. Looking ahead, easyJet will continue to
invest in resilience measures to fulfil our purpose of making low-cost travel
easy in a challenging external environment.
The airline industry as a whole continued to face significant inflationary
cost pressures in the year, although easyJet largely mitigated the impact
through a focus on cost management alongside increased capacity and aircraft
utilisation contributing to improved productivity. The delivery of 16 new NEO
aircraft continued our upgauging journey, and data insight and AI deployment,
as well as key procurement initiatives and the benefit of our net cash
balance, contributed to our overall management of costs. As a result, airline
headline CPS excluding fuel for the year of £55.03 was an increase of only
1.3% on the prior year (2023: £54.30).
Taken together, the strong revenues and cost focus delivered a headline EBITDA
achievement for the year of £1,367 million, a 21% improvement on the prior
year (2023: £1,130 million), and a statutory profit before tax of £602
million, a prior year improvement of £170 million (2023: £432 million).
During the year, with a robust balance sheet and positive cash position,
easyJet repaid a €500 million Eurobond which matured in October 2023, and in
March 2024 raised a new €850 million Eurobond with a coupon of 3.75%
maturing in 2031. At 30 September 2024, easyJet had a net cash position of
£181 million (2023: £41 million). As a result of our strong balance sheet
position and EBIT performance the year-end headline ROCE of 16.1% (2023:
12.6%) is a positive step towards our target of delivering sustainable high
teen returns on capital employed.
Where amounts are presented at constant currency these values are an
alternative performance measure (APM) and are not determined in accordance
with International Financial Reporting Standards (IFRS), but provide relevant
and comparative reporting for readers of these financial statements.
Definitions of APMs and reconciliations to IFRS measures are set out in the
glossary in the annual reports and accounts.
Performance summary
£ million (reported) 2024 2023
Total revenue 9,309 8,171
Headline costs excluding fuel, balance sheet FX and ownership costs(1) (5,719) (5,008)
Fuel (2,223) (2,033)
Headline EBITDA 1,367 1,130
Depreciation and amortisation (770) (654)
Headline EBIT 597 476
Net finance income/(charges) 9 (48)
Foreign exchange gain 4 27
Total headline profit before tax 610 455
Being:
Airline headline profit before tax 420 333
Holidays headline profit before tax 190 122
Total headline profit before tax per seat £6.08 £4.91
£ per seat - Airline only (2) 2024 2023
Airline revenue 81.35 79.84
Headline costs excluding fuel, balance sheet FX and ownership costs(1) (47.32) (46.93)
Fuel (22.14) (21.95)
Headline EBITDA 11.89 10.96
Depreciation and amortisation (7.58) (7.02)
Headline EBIT 4.31 3.94
Net finance charges (0.15) (0.63)
Foreign exchange gain 0.02 0.28
Airline headline profit before tax 4.18 3.59
1) Ownership costs are defined as depreciation and amortisation plus
net finance income/(charges).
2) These per seat metrics are for the airline business only, and
correlate to the airline revenue and costs, and the seats flown by the
airline. Both airline and easyJet holidays profit is included in the total
headline PBT per seat metric, and easyJet holidays' key metrics are included
in the key statistics section.
The total number of passengers carried in the financial year increased by 8%
to 89.7 million (2023: 82.8 million), supported by an 8% increase in seats
flown to 100.4 million seats (2023: 92.6 million seats) with a load factor of
89.3% comparable to the previous year (2023: 89.3%). This reflects the
increased capacity from an expanded network offer and a focus on winter
flying, and includes the success of new bases opened in the year. As in the
prior year, capacity was impacted by disruption events although resilience
measures and learnings from previous disruption mitigated some of the impact
from external factors with pro-active investment in parts, maintenance
scheduling, standby aircraft and staffing reducing the occurrence of
controllable disruption events. A number of cancellations were made in
response to the conflict in the Middle East, and lines of flying removed.
Capacity was redeployed and although the removal of key routes in this region
continued into the second half of the year, this did not detract from overall
capacity growth.
Total revenue increased by 14% to £9,309 million (2023: £8,171 million) and
airline RPS increased by 1.9% to £81.35 (2023: £79.84), 2.1% at constant
currency. As noted above, the airline performance was complemented by strong
easyJet holidays performance with net revenue (i.e. excluding flight revenue
which is reported under airline revenue) of £1,137 million (2023: £776
million).
Total headline costs excluding fuel increased by 14% to £6,476 million (2023:
£5,683 million), driven by the volume of flying, the growth of holidays and
general industry cost pressures. Costs were also impacted by the disruption
seen throughout the year with £187 million of EU261 compensation and welfare
costs incurred for airline passengers, although this was lower than the
previous year (2023: £211 million). On a CPS basis total airline headline
costs excluding fuel increased by only 1% to £55.03 (2023: £54.30), with CPS
benefiting from fixed operating costs being spread across greater flying
capacity. In addition, management continued to focus on operational cost
reduction with a number of projects delivered in the year including the
purchase of an established heavy base maintenance facility in Malta to secure
future capacity and provide price control. This was alongside further data and
AI deployment supporting back office cost projects and increased automation of
customer support queries, procurement initiatives across key suppliers, and
network planning bringing efficiency and productivity gains.
Total fuel costs increased by 9% to £2,223 million for the year (2023:
£2,033 million), which on an airline CPS basis represented just a 1% increase
to £22.14 (2023: £21.95), 1% at constant currency. The high price of jet
fuel from the previous year continued into H1 2024 with the outbreak of the
conflict in the Middle East, but steadied as the year progressed, with price
reductions experienced in the second half of the financial year.
Exchange rate movements stabilised in the year, with the impact of the
translation of foreign currency denominated revenue and costs on the
consolidated income statement notably reduced. Currency movements in the year
resulted in a net credit impact of £18 million (2023: £115 million debit)
across costs and revenue, with an income statement credit of £4 million
(2023: £27 million) from the translation of foreign currency denominated
monetary assets and liabilities on the statement of financial position. On a
constant currency basis, the increase in headline profit before tax compared
to the prior year was £160 million, compared to the £155 million increase
per the reported figures.
easyJet's cash position benefited from continued high interest rates in the
year and the reprofiling of debt, resulting in a net £9 million finance
credit (2023: £48 million net charge).
easyJet holidays contributed £190 million of headline profit before tax
(2023: £122 million), an increase of 56%, reflecting the 36% increase in
total holiday customers and the strength of the low fixed-cost business model.
Total headline profit before tax per seat was £6.08 (2023: £4.91). The
airline's headline profit before tax per seat improved 16% to £4.18 (2023:
£3.59), with the improvement in RPS in the year being greater than the
headline CPS increases. Fuel CPS was only a 1% increase on the previous year
and CPS excluding fuel also saw only a 1% increase, with strong cost
management and increased flying and the benefits of upgauging delivering
economies of scale to mitigate continued inflationary cost increases in the
sector. easyJet holidays contributed £1.90 (2023: £1.32) to the total
headline profit before tax per seat, reflecting increased customer numbers.
A non-headline charge of £8 million (2023: £23 million) was recognised in
the year, largely as a result of network restructuring activity in France and
Italy offset by a release of costs previously provided for severance cases in
Germany which were settled in the year. Additionally, there was £1 million
profit (£nil million loss) from the sale and leaseback of eleven aircraft
(2023: eight aircraft).
Corporate tax has been recognised at an effective rate of 24.9% (2023: 25.1%),
resulting in an overall tax charge of £150 million (2023: £108 million).
This is a tax charge of £151 million on headline items offset by a £1
million tax credit on the non-headline losses.
Profit per share
2024 2023
Pence per share Pence per share Change in pence per share
Basic headline profit per share 61.3 45.4 15.9
Basic total profit per share 60.3 43.1 17.2
Basic headline profit per share increased by 15.9 pence and basic total profit
per share increased by 17.2 pence over the prior financial year as a
consequence of the greater profit generated in the current financial year.
Return on capital employed (ROCE)
Reported £ million 2024 2023
Headline profit before interest, foreign exchange gain and tax 597 476
UK corporation tax rate 25% 25%
Normalised headline operating profit after tax (NOPAT) 448 357
Average shareholders' equity (excluding the hedging and cost of hedging 2,897 2,517
reserves)
Average net (cash)/debt (111) 315
Average capital employed 2,786 2,832
Headline return on capital employed 16.1% 12.6%
Total return on capital employed 15.9% 12.0%
ROCE is calculated by taking headline profit before interest, foreign exchange
gain and tax, applying tax at the prevailing UK corporation tax rate at the
end of the financial year, and dividing by average capital employed. Capital
employed is defined as shareholders' equity excluding hedging and cost of
hedging reserves less net (cash)/debt.
Headline ROCE for the year of 16.1% is an improvement on the prior year (2023:
12.6%). This reflects the higher headline profit for the year combined with
the increase in the net cash position. Total ROCE of 15.9% (2023: 12.0%) is
reduced by the non-headline charge in the year, and is greater than the prior
year which had a higher non-headline charge.
Summary net cash reconciliation
The below table presents cash flows on a net cash basis. This presentation is
different to the presentation of the statement of cash flows in the
consolidated financial statements as it includes non-cash movements on debt
facilities.
2024 2023 Change
£ million £ million £ million
Operating profit 589 453 136
Net tax paid (8) (12) 4
Net working capital movement excluding unearned revenue (174) (19) (155)
Unearned revenue movement 240 458 (218)
Depreciation and amortisation 770 673 97
Net capital expenditure (929) (754) (175)
Acquisition of subsidiary, net of cash acquired (22) - (22)
Net proceeds from sale and leaseback of aircraft 114 76 38
Increase in lease liability (497) (208) (289)
Purchase of own shares for employee share schemes (18) (15) (3)
Ordinary dividends paid (34) - (34)
Other (including the effect of exchange rate movements) 109 59 50
Net increase in net cash 140 711 (571)
Net cash/(debt) at the beginning of the year 41 (670) 711
Net cash at the end of the year 181 41 140
Net cash as at 30 September 2024 was £181 million (30 September 2023: £41
million) and comprised cash, cash equivalents and other investments of £3,461
million (30 September 2023: £2,925 million), borrowings of £2,106 million
(30 September 2023: £1,895 million) and lease liabilities of £1,174 million
(30 September 2023: £989 million).
Net working capital outflow, excluding unearned revenue, of £174 million in
the year (2023: £19 million) predominantly reflects a decrease in trade
payables with more efficient year-end processing, in addition to an increase
in trade and other receivables. There was a higher value of receivables due
over the year end period including miscellaneous sales ledger items, interest
receivable, airport incentive income and supplier credit notes.
The unearned revenue movement of £240 million (2023: £458 million) reflects
capacity on sale at the year end, including package holidays which
traditionally have a longer booking period. The comparative year saw a greater
movement as customer booking behaviour normalised and easyJet delivered a
significant increase in capacity and improved yields post-pandemic.
The increase in depreciation and amortisation to £770 million (2023: £673
million) includes additional depreciation from the growth of the fleet and the
increase in leased aircraft maintenance costs, recognised through
depreciation, with the rise in flying volumes and changes in the profile of
leased aircraft assets through the year. Intangible asset amortisation has
also increased with additional investment in technology assets.
Net capital expenditure in the year of £929 million (2023: £754 million)
reflects the continued investment in fleet renewal and growth in the overall
size of the fleet, alongside pre-delivery payments against our future order
book. The expenditure is across sixteen new aircraft (2023: ten), maintenance
additions, pre-delivery payments and capital expenditure on long life parts,
engines and aircraft spares. Additionally, spend on easyJet's digital
infrastructure and customer facing platforms continues with significant
intangible asset investment.
In the year easyJet plc acquired SR Technics Malta Limited, with a net cash
outflow of £22 million.
The sale and leaseback of eleven (2023: eight) aircraft in the year resulted
in a net cash inflow of £114 million (2023: £76 million). Lease additions,
including the sale and leaseback aircraft and a number of additional property
leases for head office and maintenance facilities, as well as significant
lease extension undertakings, are the key drivers for the increase in the
lease liability of £497 million (which excludes exchange rate impact and
lease rental payments).
The net £109 million movement (2023: £59 million) in 'Other' includes
movement in net interest, as interest received in this financial year offsets
interest paid due to beneficial interest rates on cash, foreign exchange
impacts and the increase of costs for share-based employee benefit schemes.
Exchange rates
The proportion of revenue and headline costs denominated in currencies other
than sterling is outlined below alongside the exchange rates in the year:
Revenue Headline costs
2024 2023 2024 2023
Sterling 55% 55% 34% 32%
Euro 35% 35% 36% 35%
US dollar 1%(1) 1% 25% 27%
Other (principally Swiss franc) 9% 9% 5% 6%
Average headline exchange rates(2) 2024 2023
Euro - revenue €1.16 €1.15
Euro - costs €1.17 €1.15
US dollar $1.24 $1.24
Swiss franc CHF 1.10 CHF 1.14
Closing exchange rates 2024 2023
Euro €1.20 €1.15
US dollar $1.34 $1.22
Swiss franc CHF 1.13 CHF 1.12
1) Our customers have the option of paying for flights in US dollars.
2) Exchange rates quoted are post-hedging applied to revenue and
headline costs.
Headline exchange rate impact
Euro Swiss franc US dollar Other Total
Favourable/(adverse) £ million £ million £ million £ million £ million
Total revenue (29) 13 (1) (2) (19)
Fuel 1 - - - 1
Headline costs excluding fuel 41 (1) (1) (3) 36
Headline total before tax(1) 13 12 (2) (5) 18
1) Excludes the impact of balance sheet translation.
easyJet's Foreign Currency Risk Management policy aims to reduce the impact of
fluctuations in exchange rates on future cash flows. Refer to note 26 in the
annual reports and accounts for more details.
As a European carrier, easyJet recognises a significant element of revenue,
35%, across its network in euros. Therefore the strengthening of sterling
against the euro on average over the year, when compared to the prior year,
has reduced the value of the revenue translated into sterling. The opposite
effect was true of Swiss franc-denominated revenue where, on average across
the year, sterling weakened against the Swiss franc which benefited revenue.
The euro exchange rate impact in revenue has been offset by the converse
impact on costs, with the stronger average sterling rate to euro compared to
the prior year reducing costs translated from euros. With exchange rates being
relatively stable in the year, on a net position the movement in average
exchange rates between the current and prior years has resulted in a
favourable foreign currency impact of £18 million across the consolidated
income statement.
For the statement of financial position, in-year movements in closing exchange
rates and a focus on natural hedging through foreign currency cash balances,
resulted in a net exchange rate impact of only a £4 million gain in the year
(2023: £27 million).
FINANCIAL PERFORMANCE
Revenue
£ million 2024 2023
Passenger revenue 5,715 5,221
Ancillary revenue 2,457 2,174
Holidays incremental revenue (1) 1,137 776
Total revenue 9,309 8,171
1) easyJet holidays numbers are after the elimination of intercompany
airline transactions.
Total revenue increased by 14% to £9,309 million (2023: £8,171 million).
Revenue performance in the year was a combined result of increased customer
volumes, a focus on optimising winter yields and summer pricing in a
competitive market alongside a continued growth in the ancillary choices we
offer customers. Total airline RPS of £81.35 was 1.9% ahead of prior year
(2023: £79.84), 2.1% at constant currency, with passenger RPS 0.9% ahead and
ancillary RPS 4.2% favourable, 1.0% and 4.7% respectively at constant
currency. The total number of passengers carried increased by 8% to 89.7
million (2023: 82.8 million), supported by additional capacity with an 8%
increase in seats flown to 100.4 million seats (2023: 92.6 million seats), 158
new routes and growth in key leisure markets in the year.
Airline ancillary revenue of £2,457 million was 13% ahead of the previous
financial year (2023: £2,174 million) as a result of both higher passenger
numbers and improved yields. Cabin bags and leisure bundles, amongst other
ancillary products, continued to deliver incremental revenue through the year,
benefitting from positive yields achieved by price optimisation. Our inflight
retail offer continues to grow in popularity as menu choices and product
selections evolve, resulting in an improved profit per seat of 13% to £0.68
(2023: £0.60), delivering additional revenue of £12 million.
Before adjusting for flight revenue, easyJet holidays customers generated
revenue of £1,521 million, a 45% growth on 2023 pre-adjusted revenue of
£1,047 million. Net of flight revenue, Holidays incremental revenue of
£1,137 million was an increase of £361 million, (2023: £776 million)
reflecting the growth in customer volumes and the success in expanding our
share of the UK package holiday market.
Similar to the prior year, within revenue there was a £47 million credit
(2023: £47 million) arising from the release of aged contract liabilities
within other payables, with £31 million recognised in passenger revenue and
£16 million in ancillary revenue.
Headline costs excluding fuel
2024 2023
Total Airline Total Airline
£ million £ per seat £ million £ per seat
Operating costs and income
Airports and ground handling 1,989 19.80 1,800 19.44
Crew 1,074 10.69 941 10.16
Navigation 463 4.61 422 4.56
Maintenance 390 3.88 341 3.69
Holidays direct operating costs 840 n/a 582 n/a
Selling and marketing 257 1.94 232 2.04
Other costs 758 6.92 695 7.09
Other income (52) (0.52) (5) (0.05)
5,719 47.32 5,008 46.93
Ownership costs
Depreciation 727 7.23 625 6.75
Amortisation 43 0.35 29 0.27
Net interest and other financing income and charges (9) 0.15 48 0.63
761 7.73 702 7.65
Foreign exchange gain (4) (0.02) (27) (0.28)
757 7.71 675 7.37
Headline costs excluding fuel 6,476 55.03 5,683 54.30
Headline CPS excluding fuel for the airline increased by 1% to £55.03 (2023:
£54.30), and by 1% at constant currency.
Included within the total headline costs excluding fuel of £6,476 million is
£947 million (2023: £654 million) related to the holidays business, the cost
increase being primarily due to the growth of the business.
Headline operating costs and income
Airports and ground handling operating costs increased by 11% to £1,989
million (2023: £1,800 million), an increase of 2% to £19.80 (2023: £19.44)
on an airline CPS basis, 3% at constant currency. With a network of largely
slot-constrained and regulated primary airports easyJet is subject to
regulatory price increases with labour costs in the general market also
contributing to CPS increases.
Crew costs increased by 14% to £1,074 million (2023: £941 million), an
increase of 5% to £10.69 (2023: £10.16) on an airline CPS basis, 6% at
constant currency, largely representing an industry wide pressure on above
inflation pay deals. This has been offset in part by productivity gains in the
year and the benefit of allocating the fixed element of crew costs over
greater capacity.
Navigation costs increased by 10% to £463 million (2023: £422 million) as a
result of both Eurocontrol rate increases and a change in route mix with new
routes introduced in the year. This was a rise of 1% to £4.61 (2023: £4.56)
on an airline CPS basis, 3% at constant currency.
Maintenance costs increased by 14% to £390 million (2023: £341 million), an
airline CPS increase of 5% to £3.88 (2023: £3.69), 5% at constant currency.
This CPS increase reflects general cost pressure in this area including the
costs of external maintenance and support functions, component costs and
internal labour costs.
Selling and marketing costs increased by 11% to £257 million (2023: £232
million). Whilst marketing costs saw an increase to support the growth of the
holidays segment, airline marketing costs were comparable to the prior year
and, combined with a benefit from commission arrangements, resulted in a lower
airline CPS of £1.94 (2023: £2.04), a 5% reduction on the previous year, 4%
at constant currency.
Total other costs increased by 9% to £758 million (2023: £695 million),
which for the airline was a reduction of 2% to £6.92 (2023: £7.09) on a CPS
basis, and 2% reduction at constant currency. Other costs include the impact
of the disruption experienced in the year, with net £187 million disruption
compensation and welfare costs incurred (2023: £211 million). Whilst
disruption continued to be a theme in the year, the number of events were
reduced over the previous year. In part this was offset by higher welfare
costs, where easyJet has an obligation to support customers impacted by
disruption, including those events outside of the airline's control such as
ATC performance, external strike action and weather events. The other cost
line also includes employee costs and benefits, with central headcount costs
increasing and wider employee share scheme offerings and other benefits also
contributing. Increases in easyJet holidays' fixed costs reflects growth in
the segment. Additionally, IT costs increased year on year with easyJet's
continued investment in technology including infrastructure, data management
and customer-facing system enhancements.
Other income of £52 million was an increase of £47 million from the prior
year (2023: £5 million). Other income includes a variety of non-revenue
receipts including supplier and airport compensation and sale of surplus
aircraft components.
Headline ownership costs
Depreciation costs increased by 16% to £727 million (2023: £625 million), a
7% increase to £7.23 (2023: £6.75) on a CPS basis, and 7% at constant
currency. There has been significant fleet activity in the year with 16 new
aircraft delivered alongside a change in the profile of leased aircraft. In
addition, the maintenance provision for leased aircraft has significantly
increased reflecting higher flying volumes, the increased cost of maintenance
events and extended obligations for a number of leased aircraft in order to
manage the impact of new aircraft delivery delays.
The increase in amortisation costs of 48% to £43 million (2023: £29 million)
reflects easyJet's investment in technology with continued enhancement to
customer facing platforms in addition to commercial infrastructure and the
evolution of data insight and digital security technology. On an airline CPS
basis, the £0.35 measure is a 30% increase on the prior year (2023: £0.27),
30% at constant currency.
Net interest and other financing income and charges were a net £9 million
credit (2023: £48 million net charge) reflecting the benefit from high
interest rates on cash deposits in the year, and the interest payments forgone
following the repayment of the UKEF drawn facility in the previous year.
Foreign exchange gains of £4 million in the year (2023: £27 million) were
marginal, being the benefit of the retranslation of foreign currency
denominated monetary assets and liabilities arising from currency movements in
the year, notably tempered by an increased focus on hedging the statement of
financial position.
Fuel
2024 2023
Total Airline Total Airline
£ million £ per seat £ million £ per seat
Fuel 2,223 22.14 2,033 21.95
Fuel costs for the year increased by 9% to £2,223 million (2023: £2,033
million), a 1% increase on a CPS basis to £22.14 (2023: £21.95), 1% at
constant currency. Fuel prices at the start of the financial year were high
reflecting the outbreak of the conflict in the Middle East in October 2023,
but settled through the second half as markets acclimatised to the
geopolitical events. Whilst overall jet fuel prices reduced in the year, the
absolute cost reflects the increased flying volume. On a per seat basis,
alongside the reduced fuel prices, the prior year comparatives were supported
by a full year benefit of the Descent Profile Optimisation software
retrofitted on our aircraft in FY23, the introduction of further fuel-saving
Idle Factor Optimisation software, and the increase of the more fuel-efficient
NEO aircraft in the fleet. These benefits were partially offset by a reduction
in the allocation of no-cost emission trading scheme (ETS) allowances as
jurisdictions wind down the 'free' aspects of the scheme with easyJet
therefore increasing the proportion of purchased allowances utilised in the
year.
easyJet uses jet fuel derivatives to hedge against increases in jet fuel
prices in order to mitigate cash and income statement volatility. 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 forecast exposures. During
the financial year, the average market price payable for jet fuel reduced by
4% to $864 per tonne from $897 per tonne in FY23. The overall post-hedge fuel
price in the year was $842 per tonne (2023: $867), the 3% reduction compared
to FY23 being due to the fuel cost at the time the hedges were entered into.
Approximately 81% of jet fuel was hedged in FY24.
Profit after tax
£ million (reported) 2024 2023
Headline profit before tax 610 455
Headline tax charge (151) (114)
Headline profit after tax 459 341
Non-headline items before tax (8) (23)
Non-headline tax credit 1 6
Total profit after tax 452 324
Non-headline items
A non-headline charge of £8 million (2023: £23 million) was recognised in
the year. This consists of a net £9 million restructuring charge and a £1
million profit on the sale and leaseback of eleven aircraft in the year (2023:
£nil million loss on eight aircraft). The restructuring charge consists of a
£12 million cost, being an estimate of the potential costs of network
restructuring exercises in Italy and France, offset by a £3 million release
from the provision for the previously announced Germany restructuring
programmes following a number of settlements finalised in the year.
Corporate tax
Corporate tax has been recognised at an effective rate of 24.9% (2023: 25.1%),
resulting in an overall tax charge of £150 million (2023: £108 million).
This splits into a tax charge of £151 million on the headline profit and a
tax credit of £1 million on the non-headline items.
Summary consolidated statement of financial position
2024 2023 Change
£ million £ million £ million
Goodwill and other non-current intangible assets 793 641 152
Property, plant and equipment (excluding right of use assets) 4,285 3,936 349
Right of use assets 1,190 928 262
Derivative financial instruments (290) 153 (443)
Equity investment 51 31 20
Other assets (excluding cash and other investments) 1,224 1,159 65
Unearned revenue (1,741) (1,501) (240)
Trade and other payables (1,656) (1,764) 108
Other liabilities (excluding debt) (1,064) (837) (227)
Capital employed 2,792 2,746 46
Cash, cash equivalents and other investments(1, 2) 3,461 2,925 536
Debt (excluding lease liabilities) (2,106) (1,895) (211)
Lease liabilities (1,174) (989) (185)
Net cash 181 41 140
Net assets 2,973 2,787 186
1) Excludes restricted cash.
2) Other investments include term deposits, tri-party repos and
managed investments.
Since 30 September 2023 net assets have increased by £186 million.
The net book value of goodwill and other non-current intangible assets of
£793 million (2023: £641 million) has increased in the year by £152
million. This includes an increase in goodwill of £22 million with the
purchase of SR Technics Malta Limited; continued investment in software
development and applications in the year of net £60 million, focusing on
digital safety and security, optimising commercial platforms and customer
applications; and non-current ETS assets of £70 million. The ETS assets are
advance purchases of allowances to meet future liabilities thereby providing a
level of certainty on the cost of future flying obligations.
Property, plant and equipment (excluding right of use assets) net book value
has increased by £349 million to £4,285 million (2023: £3,936 million). The
impact of the sale and leaseback of eleven aircraft and the depreciation
charge for the year has been offset by the sixteen new owned aircraft brought
into the fleet in the year, advanced payments on the order book and increased
capitalised parts and maintenance.
At 30 September 2024, right of use assets amounted to £1,190 million (2023:
£928 million) with lease liabilities of £1,174 million (2023: £989
million). This reflects the aircraft sale and leaseback transactions in the
year as well as a number of new leases and lease extensions and the increase
in the leased aircraft maintenance provision.
There has been a £443 million decrease in the net asset value of derivative
financial instruments, moving to a net liability position in the year of £290
million (2023: £153 million net asset). The movement is due to a decrease in
currency assets, including cross-currency swaps, as a result of the stronger
pound against the US dollar and euro in comparison to the rates at 30
September 2023, and a decrease in the price of jet fuel leading to jet fuel
hedges being in a liability position compared to 30 September 2023.
Other assets (excluding cash and other investments) of £1,224 million are
£65 million higher than the prior year (2023: £1,159 million). The
receivables asset as at 30 September 2024 has increased with trading growth
and other non-current assets increased following additional mid-life leased
aircraft entering the fleet. These increases were partially offset by a
reduction in the ETS current asset as prior year assets were surrendered in
the year as part of the annual scheme settlement process and replaced by
current year assets purchased at a lower cost.
Unearned revenue increased by £240 million to £1,741 million (2023: £1,501
million), reflecting increased capacity on sale and the growth of easyJet
holidays.
Trade and other payables reduced to £1,656 million (2023: £1,764 million)
reflecting year-end payments and a reduction in aged customer contract
liabilities whilst other liabilities of £1,165 million have increased by
£328 million (2023: £837 million) with a significant increase in the
provision for the maintenance obligation on leased aircraft with the increase
in flying over the year, the changing profile of leased aircraft, and
increased cost of maintenance activities.
Debt has increased by a net £211 million to £2,106 million (2023: £1,895
million) with the issue of the new €850 million Eurobond offsetting the
repayment of a €500 million Eurobond. Nevertheless, easyJet has improved its
net cash position over the year, with net cash increasing from £41 million at
the start of the year to £181 million at 30 September 2024.
KEY STATISTICS
OPERATING MEASURES
2024 2023 Increase/ (decrease)
Seats flown (millions) 100.4 92.6 8%
Passengers (millions) 89.7 82.8 8%
Load factor 89.3% 89.3% -
Available seat kilometres (ASK) (millions) 122,885 113,334 8%
Revenue passenger kilometres (RPK) (millions) 111,615 102,984 8%
Average sector length (kilometres) 1,223 1,224 0%
Sectors (thousands) 559 519 8%
Block hours (thousands) 1,182 1,094 8%
easyJet holidays customers (thousands) (1) 2,575 1,893 36%
Number of aircraft owned/leased at end of year 347 336 3%
Average number of aircraft owned/leased during year 342 328 4%
Average number of aircraft operated per day during year 291 276 5%
Number of routes operated over the year 1,099 1,018 8%
Number of airports served at end of year 160 155 3%
FINANCIAL MEASURES 2024 2023 Favourable/ (adverse)
Return on capital employed 15.9% 12.0% 3.9ppts
Headline return on capital employed 16.1% 12.6% 3.5ppts
Profit before tax per seat (£) 6.00 4.67 28%
Headline profit before tax per seat (£) 6.08 4.91 24%
Airline profit before tax per seat (£) 4.10 3.35 22%
Airline headline profit before tax per seat (£) 4.18 3.59 16%
Airline headline profit before tax per ASK (pence) 0.34 0.29 17%
easyJet holidays profit before tax (£ millions) 190 122 56%
Revenue
Airline revenue per seat (£) 81.35 79.84 1.9%
Airline revenue per seat at constant currency (£) 81.53 79.84 2.1%
Airline revenue per ASK (pence) 6.65 6.52 2.0%
Airline revenue per ASK at constant currency (pence) 6.66 6.52 2.1%
Airline revenue per passenger (£) 91.11 89.36 2.0%
Airline revenue per passenger at constant currency (£) 91.32 89.36 2.2%
Costs
Per seat measures
Airline headline cost per seat (£) 77.17 76.25 (1.2)%
Airline headline cost per seat excluding fuel (£) 55.03 54.30 (1.3)%
Airline headline cost per seat exc fuel at constant currency (£) 55.36 54.58 (1.4)%
Per ASK measures
Airline headline cost per ASK (pence) 6.31 6.23 (1.3)%
Airline headline cost per ASK excluding fuel (pence) 4.50 4.44 (1.4)%
Airline headline cost per ASK exc fuel at constant currency (pence) 4.52 4.46 (1.3)%
1) easyJet holidays' customer numbers excluding agency commission
customers are 2.3 million (2023: 1.6 million).
Glossary
· Available seat kilometres (ASK) - Seats flown multiplied by the
number of kilometres flown.
· Airline cost per ASK (CASK) - Total Airline costs divided by
available seat kilometres.
· Airline cost per seat (CPS) - Total Airline costs divided by seats
flown.
· Airline cost per seat, excluding fuel (CPS ex fuel)- Total Airline
costs adding back fuel costs, divided by seats flown.
· Capital employed - Shareholders' equity excluding the hedging and
cost of hedging reserves, plus net cash/debt.
· Load factor - Number of passengers as a percentage of number of
seats flown. The load factor is not weighted for the effect of varying sector
lengths.
· Headline earnings per share - Total headline profit 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.
· Headline - measures of underlying performance which is not impacted
by non-headline items.
· Headline return on capital employed (ROCE) - Headline profit/loss
before interest, exchange gain/(loss) and tax, applying tax at the prevailing
UK corporation tax rate at the end of the financial year, and dividing by the
average capital employed.
· Net cash - Total cash less borrowings and lease liabilities; cash
includes money market deposits and other cash investments but excludes
restricted cash.
· 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/nature.
· Passengers - Number of earned seats flown. Earned seats comprises
seats sold to passengers (including no-shows), seats provided for promotional
purposes and seats provided to staff for business travel.
· Profit before tax per seat - Profit before tax divided by seats
flown.
· Revenue - The sum of passenger revenue and ancillary revenue,
including package holiday revenue.
· Revenue per ASK (RASK) - Airline revenue divided by available seat
kilometres.
· Revenue per seat (RPS) - Airline revenue divided by seats flown.
· Seats flown - Seats available for passengers.
· Sector - A one-way revenue flight
Going Concern and Viability Statement
Assessment of prospects
The strategic report in the annual report and accounts sets out easyJet's
activities and the factors likely to impact its future development,
performance and position. The Finance Review in the annual report and accounts
sets out easyJet's financial position for the year ending 30 September 2024,
cash flows, liquidity position and borrowing activity. The notes to the
financial statements include the objectives, policies and procedures for
managing capital, financial risk management objectives, details of financial
instruments and hedging activities and exposure to credit risk and liquidity
risk.
In accordance with the requirements of the 2018 UK Corporate Governance Code,
the Directors have assessed easyJet's long-term prospects, taking into account
its current position, the medium-term targets set out in the strategic plan
and a range of internal and external factors, including the principal risks.
The Directors have determined that a three-year period is an appropriate
timeframe for this viability assessment. In concluding on a three-year period,
the Directors considered the reliability of forecast information, the current
macro-economic and market conditions and longer-term management incentives.
However, it is noted that the high-level fleet plan used by easyJet is
necessarily over a longer time period to enable the future planning of
aircraft deliveries which underpin our plans for fleet modernisation, future
growth, cost efficiencies and sustainability improvements. This longer-term
planning is evidenced this year by the aircraft purchase transaction which has
secured aircraft deliveries for the period FY29-34.
The assessment of the prospects of the Group includes the following factors:
· The strategic plan - which takes into consideration growth expected
by way of creating value through the business model, market conditions, future
commitments, cash flow, expected impact of key risks, funding requirements and
the maturity of existing financing facilities (see table below).
As at September 2024 Maturity date Available funds
(drawn and undrawn)
Eurobonds June 2025 €500m
March 2028 €1,200m
March 2031 €850m
Revolving credit facility September 2025(1) $400m
Undrawn UKEF backed facility June 2028 $1,750m
1) Option to extend to September 2026 at lender's consent.
· The fleet plan - the plan retains some flexibility to adjust the
size of the fleet in response to opportunities or risks.
· Strength of the balance sheet and unencumbered assets - this
sustainable strength gives us access to capital markets.
· Risk assessment - see detailed risk assessment in the annual report
and accounts.
Stress testing
The corporate risk management framework facilitates the identification,
analysis and response to plausible risks, including emerging risks, as our
business evolves in an ever changing environment. Through our corporate risk
management process, a robust assessment of the principal risks facing the
organisation has been performed and the controls and mitigations identified.
Both individually and combined these potential risks are unlikely to require
significant additional management actions to support the business to remain
viable; however, there could be actions that management would deem necessary
to reduce the impact of the risks. The stress testing scenarios identified in
the table below show that there remains sufficient liquidity under all
scenarios. In the first four scenarios one of the assumptions is that new
Eurobonds are issued, whereas in the last scenario no issuance of new
Eurobonds is assumed.
Going concern statement
The financial statements have been prepared on a going concern basis. In
adopting the going concern basis 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 through to June 2026.
As at 30 September 2024, easyJet had a net cash position of £181 million
including cash and cash equivalents of £1.3 billion, with access to £5.1
billion of liquidity, and has retained ownership of 54% of the total fleet,
all of which are 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 perform over the period. The future
impact of climate change on the business has been incorporated into strategic
plans, including the estimated financial impact within the base case cash flow
projections of the cost of future fleet renewals, the future estimated price
of the Emissions Trading Scheme (ETS) allowances, the phasing out of the free
ETS allowances, the expected price and quantity required of Sustainable
Aviation Fuel (SAF) and the cost of carbon removal credits and other
sustainability initiatives.
The business is exposed to fluctuations in fuel prices and foreign exchange
rates. easyJet is currently c.80% hedged for fuel in H1 of FY25 at c.$808 per
metric tonne, c.59% hedged for H2 FY25 at c.$771 and c.24% hedged for H1 FY26
at c.$761.
In modelling the impact of severe but plausible downside risks, the Directors
have considered demand suppression leading to a reduction in ticket yield of
5% and a reduction in easyJet holidays contribution of 5%. The model also
includes the reoccurrence of additional disruption costs (at FY22 levels), an
additional $50 per metric tonne on the fuel price, 1.5% additional operating
cost inflation and an adverse movement on the US dollar rate. These impacts
have been modelled across the whole going concern period. In addition, this
downside model also includes a grounding of 25% of the fleet for the duration
of the peak trading month of 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 liquidity requirements.
After reviewing the current liquidity position, committed funding facilities,
the base case and the 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.
Viability Statement
Based on the assessment performed, the Directors have a reasonable expectation
that the Company and the Group will be able to continue in operation and meet
all liabilities as they fall due up to September 2027. In making this
statement, the Directors have made the following key assumptions:
1. easyJet has access to a variety of funding options including capital
markets, aircraft financing and bank or government debt. The stress testing
demonstrates that the current funding with both the repayment and new issue of
Eurobonds would be sufficient to retain liquidity in both the base and
downside scenarios (noting that the new issue of Eurobonds is excluded from
the specific lack of funding scenario).
2. In assessing viability, it is assumed that the detailed risk
management process as outlined in the annual report and accounts captures all
plausible risks, and that in the event that multiple risks occur, all
available actions to mitigate the impact to the Group would be taken on a
timely basis and have the intended impact.
3. There is no prolonged grounding of a substantial portion of the fleet
greater than that included in the downside and alternative downside scenarios.
These include a grounding of 25% of the fleet for the duration of the peak
trading month of August, to cover the range of severe but plausible risks that
could result in significant operational disruption.
The key risks that are most likely to have a significant impact on easyJet's
viability have been considered in the stress testing across multiple scenarios
and are shown in the table below. These scenarios are applied separately and
there remains sufficient liquidity in all cases. The assumptions applied are
based on the plausible but severe impacts of the risks, as assessed by our
review of the current macro-economic position. The principal risks have
continued to be assessed for any changes in the risk environment. The actions
in place to mitigate against these risks are included in the Risk section in
the annual report and accounts.
Scenario modelled Description Assumptions applied Corporate risk covered
Demand suppression and operational disruption Downside scenario covering multiple risks that may lead to a reduction in Across the whole period: Changing legal and regulatory landscape
demand, resulting in a prolonged yield reduction over the period. In addition,
this scenario combines risks that also would lead to operational disruption · reduction in ticket yield of 5%
and/or short-term grounding of the fleet.
· reduction in Holidays' contribution of 5% Significant safety or security event
· additional disruption costs (based on FY22 levels).
Significant digital security event
One-off:
- a grounding of 25% of the fleet for the duration of the peak trading Network and primary airport risks
month of August.
Significant operational disruption
Increase in costs and operational disruption Scenario covers multiple risks that would result in an increase in costs Across the whole period: Changing legal and regulatory landscape
across the period or a significant spike in costs. In addition, this scenario
combines risks that also would lead to operational disruption and/or · additional $100 per metric tonne on the fuel price
short-term grounding of the fleet.
· increased costs (additional inflation assumed on all costs) Significant safety or security event
· additional disruption costs (based on FY22 levels)
· an adverse movement on the US dollar rate. Significant operational disruption
One-off: Significant digital security event
- a grounding of 25% of the fleet for the duration of the peak trading
month of August.
Network and primary airport risks
Macro-economic conditions
Climate change Scenario covers climate-based risks that would result in both a reduction in Across the whole period: Climate change transition risks
demand and increased costs. This includes SAF and ETS costs, capex and
maintenance costs due to technology changes and additional costs for · reduction in demand - reduced yields or capacity
regulatory and legal challenge.
· increased fuel costs (SAF and ETS)
· increased maintenance costs
· new taxes.
Failure to deliver on plans Scenario covers the risks that would result in easyJet being unable to deliver Across the whole period: Non-delivery of strategic initiatives
on its plans for the period.
· reduced initiatives income
· increased costs Talent and critical skills acquisition
· reduction in ticket yield of 5%
· reduction in Holidays' contribution of 5%.
Lack of funding Scenario covers the risk that would result in no further funding being Across the whole period: Macro-economic conditions
available to easyJet during the period.
· uncommitted funding excluded.
Consolidated income statement
Year ended 30 September
2024 2023
Headline Non-headline (note 2) Total Headline Non-headline (note 2) Total
Notes £ million £ million £ million £ million £ million £ million
Passenger revenue 5,715 - 5,715 5,221 - 5,221
Ancillary revenue
Airline ancillary revenue 2,457 - 2,457 2,174 - 2,174
Holidays incremental revenue 1,137 - 1,137 776 - 776
Total ancillary revenue 3,594 - 3,594 2,950 - 2,950
Total revenue 5 9,309 - 9,309 8,171 - 8,171
Fuel (2,223) - (2,223) (2,033) - (2,033)
Airports and ground handling (1,989) - (1,989) (1,800) - (1,800)
Crew (1,074) - (1,074) (941) - (941)
Navigation (463) - (463) (422) - (422)
Maintenance (390) - (390) (341) - (341)
Holidays direct operating costs (excluding flights) (840) - (840) (582) - (582)
Selling and marketing (257) - (257) (232) - (232)
Other costs (758) (9) (767) (695) (10) (705)
Other income 52 1 53 5 6 11
EBITDA 1,367 (8) 1,359 1,130 (4) 1,126
Depreciation 7 (727) - (727) (625) (19) (644)
Amortisation of intangible assets (43) - (43) (29) - (29)
Operating profit 597 (8) 589 476 (23) 453
Interest receivable and other financing income 141 - 141 132 - 132
Interest payable and other financing charges (132) - (132) (180) - (180)
Foreign exchange gain 4 - 4 27 - 27
Net finance income/(charges) 13 - 13 (21) - (21)
Profit before tax 610 (8) 602 455 (23) 432
Tax charge 3 (151) 1 (150) (114) 6 (108)
Profit for the year 459 (7) 452 341 (17) 324
Earnings per share, pence
Basic 4 60.3 43.1
Diluted 4 59.6 42.7
Consolidated statement of comprehensive income
Year ended Year ended
30 September 2024 30 September 2023
Notes £ million £ million
Profit for the year 452 324
Other comprehensive (loss)/income
Items that may be reclassified to the income statement:
Cash flow hedges
Fair value losses in the year (358) (19)
Losses/(gains) transferred to the income statement 23 (51)
Hedge ineffectiveness/discontinuation losses transferred to the income 2 1
statement
Related deferred tax credit 3 83 12
Cost of hedging (8) (9)
Related deferred tax credit 3 2 2
Items that will not be reclassified to the income statement:
Remeasurement loss of post-employment benefit obligations (11) (8)
Related deferred tax credit/(charge) 3 3 (1)
Fair value gain on equity investment 20 -
(244) (73)
Total comprehensive income for the year 208 251
Consolidated statement of financial position
As at 30 September 2024 As at 30 September 2023
Notes £ million £ million
Non-current assets
Goodwill 387 365
Other intangible assets 406 276
Property, plant and equipment 7 5,475 4,864
Derivative financial instruments 2 35
Equity investment 51 31
Restricted cash - 2
Other non-current assets 169 138
6,490 5,711
Current assets
Trade and other receivables 483 343
Current intangible assets 572 676
Derivative financial instruments 29 186
Other investments 2,118 -
Cash and cash equivalents 1,343 2,925
4,545 4,130
Current liabilities
Trade and other payables (1,656) (1,764)
Unearned revenue (1,737) (1,498)
Borrowings 8 (416) (433)
Lease liabilities (227) (217)
Derivative financial instruments (270) (54)
Current tax liabilities 3 (9) (3)
Provisions for liabilities and charges 9 (156) (175)
(4,471) (4,144)
74 (14)
Net current assets/(liabilities)
Non-current liabilities
Unearned revenue (4) (3)
Borrowings 8 (1,690) (1,462)
Lease liabilities (947) (772)
Derivative financial instruments (51) (14)
Other liabilities (6) (4)
Post-employment benefit obligations (17) (7)
Provisions for liabilities and charges 9 (806) (626)
Deferred tax liabilities 3 (70) (22)
(3,591) (2,910)
Net assets 2,973 2,787
Shareholders' equity
Share capital 207 207
Share premium 2,166 2,166
Hedging reserve (137) 113
Cost of hedging reserve (8) (2)
Translation reserve 72 72
Retained earnings 673 231
Total equity 2,973 2,787
Consolidated statement of changes in equity
Share capital Share premium Hedging reserve Cost of hedging reserve Translation reserve Retained earnings/ (accumulated losses) Total equity
£ million £ million £ million £ million £ million £ million £ million
At 1 October 2023 207 2,166 113 (2) 72 231 2,787
Profit for the year - - - - - 452 452
Other comprehensive (loss)/income - - (250) (6) - 12 (244)
Total comprehensive (loss)/income - - (250) (6) - 464 208
Dividends paid - - - - - (34) (34)
Share incentive schemes
Employee share schemes - - - - - - 30 30
Value of employee services
Purchase of own shares - - - - - (18) (18)
At 30 September 2024 207 2,166 (137) (8) 72 673 2,973
Share Share premium Hedging reserve Cost of hedging reserve Translation reserve Retained earnings/ (accumulated losses) Total equity
capital
£ million £ million £ million £ million £ million £ million £ million
At 1 October 2022 207 2,166 170 5 (6) (9) 2,533
Profit for the year - - - - - 324 324
Other comprehensive loss - - (57) (7) - (9) (73)
Total comprehensive (loss)/income - - (57) (7) - 315 251
Share incentive schemes
Employee share schemes - - - - - - 18 18
Value of employee services
Purchase of own shares - - - - - (15) (15)
Currency translation transfer(1) - - - - 78 (78) -
At 30 September 2023 207 2,166 113 (2) 72 231 2,787
1) The translation reserves transfer relates to a correction of a
historical error in the retranslation of monetary assets and liabilities in
overseas subsidiaries on consolidation. The cumulative amount of exchange
differences on these balances were previously presented within retained
earnings/(accumulated losses) in the consolidated statement of changes in
equity and the consolidated statement of financial position. However, these
exchange differences should have been presented as part of the translation
reserve. This has resulted in a £78 million transfer between retained
earnings/(accumulated losses) and the translation reserve to more accurately
present the cumulative foreign exchange gains recognised on consolidation. The
nature of the error is considered to not constitute a material error on a
qualitative basis and therefore the impact was adjusted in the FY23 financial
statements, being the year the error was noted. There is no change in brought
forward or carried forward total equity from this change and no restatement of
the consolidated statement of financial position or consolidated statement of
changes in equity has been made.
The hedging reserve comprises the effective portion of the cumulative net
change in the fair value of cash flow hedging instruments relating to highly
probable transactions that are forecast to occur after the year end.
At 30 September 2024, amounts in the cost of hedging reserve comprised a £1
million loss related to cross-currency basis (2023: £3 million gain) and a
£9 million loss related to the time value of options (2023: £5 million
loss).
Consolidated statement of cash flows
Year ended Year ended
30 September 2024 30 September 2023
Notes £ million £ million
Cash flows from operating activities
Cash generated from operations 10 1,483 1,509
Dividends paid 6 (34) -
Interest and other financing charges paid (101) (162)
Interest and other financing income received 124 125
Settlement of derivatives 1 91
Tax paid 3 (8) (12)
Net cash generated from operating activities 1,465 1,551
Cash flows from investing activities
Purchase of property, plant and equipment (811) (677)
Proceeds from sale of property, plant and equipment 9 -
Acquisition of subsidiary, net of cash acquired (22) -
Purchase of non-current other intangible assets (118) (77)
(Increase)/decrease in other investments 11 (2,118) 126
Proceeds from sale and leaseback of aircraft 114 76
Net cash used in investing activities (2,946) (552)
Cash flows from financing activities
Purchase of own shares for employee share schemes (18) (15)
Proceeds from debt financing 11 718 -
Repayment of bank loans and other borrowings 11 (434) (1,192)
Settlement of derivatives (11) -
Repayment of capital element of leases 11 (222) (218)
Decrease in restricted cash 2 5
Net cash generated from/(used in) financing activities 35 (1,420)
Effect of exchange rate movements (136) (168)
Net decrease in cash and cash equivalents (1,582) (589)
Cash and cash equivalents at beginning of year 2,925 3,514
Cash and cash equivalents at end of year 1,343 2,925
Notes to the financial statements
1. Accounting policies, judgements and estimates
Statement of compliance
easyJet plc (the 'Company') and its subsidiaries ('easyJet' or the 'Group' as
applicable) is a low-cost airline carrier operating principally in Europe. The
Company is a public limited company (company number 03959649), incorporated
and domiciled in the United Kingdom, whose shares are listed on the London
Stock Exchange under the ticker symbol EZJ. The address of its registered
office is Hangar 89, London Luton Airport, Luton, Bedfordshire, LU2 9PF,
England.
The consolidated financial statements of easyJet plc have been prepared in
accordance with UK-adopted International Accounting Standards and with the
requirements of the Companies Act 2006 as applicable to companies reporting
under those standards.
Basis of preparation
This consolidated financial information has been prepared in accordance with
the Listing Rules of the Financial Conduct Authority.
The financial information set out in this document does not constitute
statutory financial statements for easyJet plc for the two years ended 30
September 2024 but is extracted from the 2024 Annual Report and Financial
statements.
The financial statements have been prepared on a going concern basis. In
adopting the going concern basis, 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 through to June 2026.
As at 30 September 2024, easyJet had a net cash position of £181 million
including cash and cash equivalents of £1.3 billion, with access to £5.1
billion of liquidity, and has retained ownership of 54% of the total fleet,
all of which are 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 perform over the period. The future
impact of climate change on the business has been incorporated into strategic
plans, including the estimated financial impact within the base case cash flow
projections of the cost of future fleet renewals, the future estimated price
of Emissions Trading Scheme (ETS) allowances, the phasing out of the free ETS
allowances, the expected price and quantity required of Sustainable Aviation
Fuel (SAF) and the cost of carbon removal credits and other sustainability
initiatives.
The business is exposed to fluctuations in fuel prices and foreign exchange
rates. easyJet is currently c.80% hedged for fuel in H1 of FY25 at c.$808 per
metric tonne, c.59% hedged for H2 FY25 at c.$771 and c.24% hedged for H1 FY26
at c.$761.
In modelling the impact of severe but plausible downside risks, the Directors
have considered demand suppression leading to a reduction in ticket yield of
5% and a reduction in easyJet holidays' contribution of 5%. The model also
includes the reoccurrence of additional disruption costs (at FY22 levels), an
additional $50 per metric tonne on the fuel price, 1.5% additional operating
cost inflation and an adverse movement on the US dollar rate. These impacts
have been modelled across the whole going concern period. In addition, this
downside model also includes a grounding of 25% of the fleet for the duration
of the peak trading month of 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 liquidity requirements.
After reviewing the current liquidity position, committed funding facilities,
the base case and the 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.
The Annual Report and Financial statements for 2023 has been delivered to the
Registrar of Companies.
The Annual Report and Financial statements for 2024 will be delivered to the
Registrar of Companies in due course. The auditors' report on those financial
statements was unqualified and neither drew attention to any matters by way of
emphasis nor contained a statement under either section 498(2) of Companies
Act 2006 (accounting records or returns inadequate or financial statements not
agreeing with records and returns), or section 498(3) of Companies Act 2006
(failure to obtain necessary information and explanations).
Accounting policies
The accounting policies adopted are consistent with those described in the
Annual report and financial statements for the year ended 30 September 2024.
Accounting judgements and estimates
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make judgements as to
the application of accounting standards to the recognition and presentation of
material transactions, assets and liabilities within the Group, and the use of
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements, and the reported amounts
of income and expenses during the reporting period. Estimations are based on
management's best evaluation of a range of assumptions, however, 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.
Critical accounting judgements
The following are the critical judgements, apart from those involving
estimation (which are dealt with separately below), that the Directors have
made in the process of applying the Group's accounting policies and that have
the most significant effect on the amounts recognised and presented in the
financial statements.
Classification of income or expenses between headline and non-headline (note
2)
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 statement of financial position,
whether that item was first generated via headline or non-headline activity.
The rebuttable presumption being that when subsequently extinguishing an item
from the statement of financial position, 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;
· if the item is irregular in nature; and
· whether the item is unusual by virtue of its size.
In accordance with Group policy, non-headline items include expenditure on
major restructuring programmes and the gain or loss resulting from the initial
recognition of sale and leaseback transactions. They may also include
impairments and amounts relating to corporate acquisitions and disposals,
depending on the assessment of the above criteria.
Recoverability of deferred tax assets (note 3)
The deferred tax asset balances include £440 million (2023: £442 million)
arising on full recognition of the UK trading tax losses accumulated at the
statement of financial position date. The Group has concluded that these
deferred tax assets will be fully recoverable against the unwind of taxable
temporary differences and future taxable income based on the long-term
strategic plans of the Group. Where applicable the financial projections used
in assessing future taxable income are consistent with those used elsewhere
across the business, for example in the assessment of going concern. These
assessments include the expected impact of climate change on easyJet, and the
future financial impact within cash flow projections, such as the cost of
future fleet renewals, the future estimated price of ETS allowances, the
phasing out of the free ETS allowances, the expected price and quantity
required of SAF, and the cost of carbon removal credits and other
sustainability initiatives.
The tax losses for which a deferred tax asset has been recognised are expected
to be utilised within the next six years, assessed by considering probable
forecast future taxable income. The probable forecast future taxable income
includes the impact of the expected unwind of taxable temporary differences as
well as the effect of Full Expensing Relief for qualifying capital
expenditure. Probable forecast future taxable income includes an incremental
and increasing risk weighting to represent higher levels of uncertainty in
future periods.
The tax losses can be carried forward indefinitely and have no expiry date.
Consolidation of easyJet Switzerland S.A.
Judgement has been applied in consolidating easyJet Switzerland S.A. as a
subsidiary on the basis that the Company exercises control over the
undertaking. A non-controlling interest has not been reflected in the
consolidated financial statements on the basis that the holders of the
remaining 51% of the shares have no entitlement to any dividends from that
holding and the Company has an option to acquire those shares for a
predetermined minimal consideration.
Critical accounting estimates
The following critical accounting estimates include judgements or complexity
and are the major sources of estimation uncertainty that have a significant
risk of resulting in a material adjustment to the carrying amounts of assets
and liabilities within the next year.
Aircraft maintenance provisions - £894 million (2023: £753 million) (note 9)
easyJet incurs liabilities for maintenance costs arising during the lease term
of leased aircraft. These costs arise from legal and constructive contractual
obligations relating to the condition of the aircraft when it is returned to
the lessor. To discharge these obligations, it is usual for easyJet to carry
out at least one heavy maintenance check on each of the engines and the
airframe of the aircraft during the lease term. A material provision
representing the estimated cost of this obligation is built up over the course
of the lease. The estimates and assumptions used in the calculation of the
provision are reviewed at least annually, and when information becomes
available that is capable of causing a material change to an estimate, such as
the renegotiation of end of lease return conditions, increased or decreased
aircraft utilisation, or changes in the cost of heavy maintenance services and
the expected uplift in future prices.
A significant portion of the future maintenance costs and cost increases are
under contract and provide certainty to the provision. Where cost increases
are not under contract, an estimation of the likely future increases are made
in the calculation of the provision. Given the significant value of the
provision, the provision is sensitive to changes in the future increase of
uncontracted costs. An additional 4% cost uplift on uncontracted costs over
the future years used in the provision would result in a £32 million increase
in the provision. Additionally, with many maintenance costs incurred in US
dollars, the provision remains sensitive to changes in the GBP/USD exchange
rate. A significant +/- 10 cent change in the GBP/USD exchange rate would
impact the provision by -£50 million/+£58 million respectively.
The rates used to discount the provision to arrive at a present value are
based on observable market rates as an estimate of the relevant risk free
rate.
The provision can also be materially influenced by the maintenance status of
aircraft when they enter the easyJet fleet. To give flexibility to the fleet
plan easyJet may lease 'mid-life' aircraft. When mid-life aircraft enter the
fleet, a 'catch-up' maintenance provision is created to reflect the
maintenance obligation for the flying cycles undertaken before the aircraft
entered the easyJet fleet. The trigger for the recognition of this addition to
the provision is the signing of the lease contract. It is of note that where
contractually agreed a mid-life delivery asset is also created when the
mid-life leased aircraft enter the fleet, creating a separate related asset on
the statement of financial position.
Goodwill and landing rights - £542 million (2023: £520 million)
It is management's judgement that there are two separate CGUs which generate
largely independent cash flows, these being easyJet's Airline route network
and its Holidays business. The recoverable amount of goodwill and landing
rights has been determined based on value in use calculations for the airline
route network CGU as they are wholly attributable to it. The value in use is
determined by discounting future cash flows to their present value. When
applying this method, easyJet relies on a number of key estimates including
the ability to meet its strategic plans, future fuel prices and exchange
rates, long-term economic growth rates for the principal countries in which it
operates, and its pre-tax weighted average cost of capital. Strategic plans
include assessments of the future impact of climate change on easyJet to the
extent these can be estimated. This includes for example, the cost of future
fleet renewals, the future estimated price of ETS allowances, the phasing out
of the free ETS allowances, the expected price and quantity required of SAF
and the cost of carbon removal credits and other sustainability initiatives.
The possible impact of longer-term climate change risks that are not part of
the strategic plans have been considered as part of the sensitivity analysis.
Fuel prices and exchange rates continue to be volatile in nature and the
ability to pass these changes on to the customer is a critical judgement that
requires estimation. In addition, assumptions over customer demand levels
could have a significant effect on the impairment assessment performed. Any
future events that would lead to extended travel restrictions or fleet
grounding may impact future impairment or useful economic life assessments.
The sensitivity analysis considered as part of the overall impairment
assessment takes into account different assumptions for these key estimates.
Other areas of judgement and accounting estimates
The following are other areas of judgement and accounting estimates that do
not meet the definition under IAS 1 of significant accounting estimates or
critical accounting judgements. The recognition and measurement of the
following material assets and liabilities of note in that they are based on
assumptions and/or are subject to longer term uncertainties.
Owned aircraft carrying values - £4,192 million (2023: £3,846 million) (note
7)
The key estimates used in arriving at aircraft carrying values are the UELs
and residual values of the owned aircraft.
Aircraft are depreciated over their UEL to their residual values in line with
the Property, Plant and Equipment Accounting Policy. The UEL is based on
easyJet's long-term fleet plan and intended utilisation of the current fleet,
which include long-term assumptions of market conditions and customer demands,
which by their nature are inherently uncertain.
Residual value estimates for aircraft are based on independent aircraft
valuations. The valuations are based on an assessment of the current state of
the global marketplace for specific aircraft assets. Should the marketplace
for an asset class deteriorate unpredictably, there could be a risk that the
recoverable amount for some aircraft assets would fall below their current
carrying value or that residual values are subject to downward adjustment.
Owned and leased aircraft asset recoverable amounts are included in the
Airline CGU and are therefore subject to review for impairment annually or
when there is an indication of impairment within the Airline CGU.
Defined benefit pension assumptions - £175 million gross obligation (2023:
£152 million gross obligation)
The Swiss pension scheme meets the requirements under IAS 19 to be recognised
as a defined benefit pension scheme and the net pension obligation is
recognised on the consolidated statement of financial position. The
measurement of scheme assets and obligations are calculated by an independent
actuary in line with IAS 19. The financial and demographic assumptions used in
the calculation are determined by management following consultation with the
independent actuary with consideration of external market movements and
inputs. The calculation is most sensitive to movements in the discount rate
applied, which has been subject to significant volatility.
Liability for compensation payments - £50 million (2023: £62 million)
easyJet incurs liabilities for amounts payable to customers who make claims in
respect of flight delays and cancellations, for which claims could be made up
to six years after the event, and for reimbursement of reasonable expenses
incurred as a result of flight delays and cancellations. The key estimation in
the liability is the passenger claim rate for compensation payments. The
estimation carries a level of uncertainty as it is based on customer
behaviour. The basis of the estimates included in the liability are reviewed
at least annually and when information becomes available that may result in a
change to the estimate.
New and revised standards and interpretations
A number of amended standards became applicable during the current reporting
period. The Group did not have to change its accounting policies or make
retrospective adjustments as a result of adopting these standards. The
amendments that became applicable for annual reporting periods commencing on
or after 1 January 2023, and did not have a material impact were:
· IFRS 17 Insurance Contracts
· Disclosure of Accounting Policies - Amendments to IAS 1 and IFRS
Practice Statement 2
· Definition of Accounting Estimates - Amendments to IAS 8
· Deferred Tax related to Assets and Liabilities arising from a Single
Transaction - Amendments to IAS 12
· International Tax Reform - Pillar Two Model Rules - Amendments to IAS
12
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.
2. Non-headline items
An analysis of the amounts presented as non-headline is given below:
Year ended Year ended
30 September 2024 30 September 2023
£ million £ million
Sale and leaseback gain (1) -
Restructuring charge 9 1
Loss on disposal of landing rights - 3
Correction of prior year error - 19
Total non-headline charge before tax 8 23
Tax credit on non-headline items (1) (6)
Total non-headline charge after tax 7 17
Sale and leaseback gain
During the year, easyJet completed the sale and leaseback of 11 A319 aircraft
(2023: eight). The income statement impact of the 11 sale and leasebacks was a
£1 million profit on disposal (2023: £nil million profit) recognised in
other income.
Restructuring
Following a network review in the financial year, restructuring programmes
impacting bases in France and Italy were announced in September 2024. A
provision of £12 million has been recognised in the financial statements as a
best estimate of the potential costs of the restructuring exercise. This cost
has been recognised as non-headline in accordance with our non-headline
accounting policy. The cost has been offset by a £3 million release from the
provision for the previously announced restructuring programmes in Germany,
following a number of settlements finalised in the year. The release has been
credited to other costs where the initial expense was recognised.
In the prior year the restructuring charge included a £3 million loss on
disposal of landing right 'slots' surrendered at Berlin Brandenburg Airport as
a result of the downsizing of operations at the airport, and £1 million
representing additional estimated costs arising from the restructuring
programmes in Germany.
As at 30 September 2024, there were unpaid amounts of £12 million (2023: £6
million) representing remaining redundancy cases which have not been finalised
and settled at the end of the financial year.
Correction of prior year error
In the previous financial year, a £19 million cost was recognised as
non-headline for the correction of an error identified in a third-party
system. The error related to aircraft lease modifications which occurred in
FY21, and impacted the depreciation recognised on a number of right of use
assets.
Tax on non-headline items
After the necessary tax adjustments, which principally relate to the sale and
leaseback transactions and restructuring provisions, there is a non-headline
tax credit of £1 million (2023: £6 million) for the year.
3. Tax charge
Tax on profit on ordinary activities
Year ended Year ended
30 September 2024 30 September 2023
£ million £ million
Current tax
Foreign tax 13 11
Total current tax charge 13 11
Deferred tax
Temporary differences relating to property, plant and equipment 145 76
Other temporary differences (4) 24
Adjustments in respect of prior years (4) (3)
Total deferred tax charge 137 97
Total tax charge 150 108
Effective tax rate 24.9% 25.1%
Reconciliation of the total tax charge
The tax for the year is lower than (2023: higher than) the standard rate of
corporation tax in the UK as set out below:
2024 2023
£ million £ million
Profit before tax 602 432
Total tax charge at 25.0% (2023: 22.0%) 151 95
Income not chargeable for tax purposes:
Expenses not deductible for tax purposes 10 8
Share-based payments (5) (3)
Adjustments in respect of prior years - overseas current tax (1) -
Adjustments in respect of prior years - deferred tax (4) (3)
Difference in applicable rates for current and deferred tax - 12
Attributable to rates other than standard UK rate (2) (1)
Movement in provisions 1 -
Total tax charge 150 108
Current tax payable at 30 September 2024 amounted to £9 million (2023: £3
million payable) which is solely related to tax payable in other European
jurisdictions.
During the year ended 30 September 2024, net cash tax paid amounted to £8
million (2023: £12 million).
The Group monitors income tax developments in all jurisdictions in which it
operates, including the OECD Base Erosion and Profit Shifting (BEPS)
initiative (Pillar 2), which may impact the Group's future tax liabilities.
The UK has introduced a global minimum corporation tax in line with the OECD
Inclusive Framework on BEPS, which requires a minimum corporation tax rate of
15% in each jurisdiction in which the Group operates. The first accounting
period to which the new rules will apply to the Group in the UK will be the
year ended 30 September 2025.
Year ended Year ended
30 September 2024 30 September 2023
£ million £ million
Credit/(charge) to other comprehensive income
Deferred tax on change in fair value of cash flow hedges 85 14
Deferred tax on post-employment benefit 3 (1)
88 13
Credit/(charge) directly to equity
Deferred tax on share-based payments 1 -
Total credit to other comprehensive income 89 13
The Group does not expect its tax liabilities to be materially increased as a
result of the UK's implementation of the Pillar 2 rules. The Group is
currently assessing their detailed impact and Malta is the only jurisdiction
that is likely to be affected. The impact on the Group's total tax charge
based on the profits earned in the year ended 30 September 2024 would be less
than 1%.
Tax on items recognised directly in other comprehensive income or
shareholders' equity:
Deferred tax
The net deferred tax (asset)/liability in the statement of financial position
is as follows:
Accelerated capital allowances Short-term timing differences Fair value losses/(gains) Share-based payments Post-employment benefit obligation Trading loss Total
£ million £ million £ million £ million £ million £ million £ million
At 1 October 2023 414 1 54 (4) (1) (442) 22
Charged/(credited) to income statement 141 (1) - (5) - 2 137
Credited to other comprehensive loss - - (85) (3) - (88)
Credited directly to equity - - - (1) - - (1)
At 30 September 2024 555 - (31) (10) (4) (440) 70
Deferred tax liabilities expected to be settled:
£ million
Within 12 months -
After more than 12 months 70
At 30 September 2024 70
It is estimated that deferred tax assets of approximately £45 million (2023:
£ nil million) will reverse during the next financial year.
Deferred tax assets and liabilities are offset when there is a legally
enforceable right to set off current tax assets against current tax
liabilities and it is the intention to settle these on a net basis.
Accelerated capital allowances Short-term timing differences Fair value (gains)/losses Share-based payments Post-employment benefit obligation Trading loss Total
£ million £ million £ million £ million £ million £ million £ million
At 1 October 2022 341 (26) 68 (1) (1) (443) (62)
Charged/(credited) to income statement 73 27 - (3) (1) 1 97
Charged/(credited) to other comprehensive loss - - (14) - 1 - (13)
At 30 September 2023 414 1 54 (4) (1) (442) 22
4. Earnings per share
Basic earnings per share has been calculated by dividing the total profit for
the year by the weighted average number of shares in issue during the year
after adjusting for shares held in employee benefit trusts.
To calculate diluted earnings per share, the weighted average number of
ordinary shares in issue has been adjusted to assume conversion of all
dilutive potential shares. Share options granted to employees where the
exercise price is less than the average market price of the Company's ordinary
shares during the year are considered to be dilutive potential shares. Where
share options are exercisable based on performance criteria and those
performance criteria have been met during the year, these options are included
in the calculation of dilutive potential shares.
Headline basic and diluted earnings per share are also presented, based on
headline profit for the year.
Earnings per share is based on:
Year ended Year ended
30 September 2024 30 September 2023
£ million £ million
Headline profit for the year 459 341
Total profit for the year 452 324
2024 2023
million million
Weighted average number of ordinary shares used to calculate basic earnings 749 751
per share
Weighted average number of ordinary shares used to calculate diluted earnings 759 758
per share
2024 2023
Earnings per share pence pence
Basic 60.3 43.1
Diluted 59.6 42.7
2024 2023
Headline earnings per share pence pence
Basic 61.3 45.4
Diluted 60.5 45.0
5. Segmental and geographical revenue reporting
Segmental analysis:
Year ended 30 September 2024
Airline Holidays Intergroup transactions Group
£ million £ million £ million £ million
Passenger revenue 5,715 - - 5,715
Ancillary revenue 2,457 1,521 (384) 3,594
Total revenue 8,172 1,521 (384) 9,309
Airline operating costs including fuel (6,139) - - (6,139)
Holidays direct operating costs - (1,214) 374 (840)
Selling and marketing (195) (62) - (257)
Other costs and other income (643) (73) 10 (706)
Amortisation and depreciation (762) (8) - (770)
Net interest (payable)/receivable and other financing income/(charges) (15) 24 - 9
Foreign exchange gain 2 2 - 4
Headline profit before tax 420 190 - 610
Non-headline items (8) - - (8)
Total profit before tax 412 190 - 602
Year ended 30 September 2023
Airline Holidays Intergroup transactions Group
£ million £ million £ million £ million
Passenger revenue 5,221 - - 5,221
Ancillary revenue 2,174 1,047 (271) 2,950
Total revenue 7,395 1,047 (271) 8,171
Airline operating costs including fuel (5,537) - - (5,537)
Holidays direct operating costs - (842) 260 (582)
Selling and marketing (189) (43) - (232)
Other costs and other income (654) (47) 11 (690)
Amortisation and depreciation (649) (5) - (654)
Net interest (payable)/receivable and other financing income/(charges) (59) 11 - (48)
Foreign exchange gain 26 1 - 27
Headline profit before tax 333 122 - 455
Non-headline items (23) - - (23)
Total profit before tax 310 122 - 432
Note that airline operating costs including fuel comprises operating costs
that relate solely to the Airline segment, and similarly holidays direct
operating costs are costs specific to the Holidays segment. All other costs
are incurred by both the Airline and Holidays segments.
Airline revenue is recognised at a point in time (when the flight takes
place). The Holidays revenue detailed in this note includes both flight
revenue, recognised at the time the flight takes place, and remaining
ancillary revenue which is recognised over time, aligned to the duration of
the holiday. The holidays flight revenue is included in this note within
ancillary revenue (with the associated intergroup transaction) aligned to the
presentation of revenue to the CODM and plc Board.
The intergroup transactions column represents revenue and cost transactions
between Airline and Holidays for the flight element of holiday packages and
Group recharges. These intercompany transactions are eliminated on
consolidation.
Assets and liabilities are not allocated to individual segments and are not
separately reported to, or reviewed by, the CODM, and therefore have not been
disclosed.
Geographical revenue:
2024 2023
£ million £ million
United Kingdom 5,077 4,345
France 941 852
Switzerland 877 791
Northern Europe (excluding Switzerland) 641 610
Southern Europe (excluding France) 1,670 1,434
Other 103 139
9,309 8,171
easyJet has assessed the materiality of geographical revenues and has
disclosed revenues by country of origin where such revenues are in excess of
10% of total revenue.
Geographical revenue is allocated according to the location of the first
departure airport on each booking.
Southern Europe comprises countries lying wholly or mainly south of the border
between Italy and Switzerland.
easyJet holidays' revenue is predominantly from the United Kingdom with
additional revenues generated in Europe that are not material for separate
disclosure.
easyJet's non-current assets principally comprise its fleet of 188 (2023: 183)
owned and 159 (2023: 153) leased aircraft, giving a total fleet of 347 at 30
September 2024 (2023: 336). 30 aircraft (2023: 27) are registered in
Switzerland, 134 (2023: 128) are registered in Austria, and the remaining 183
(2023: 181) are registered in the United Kingdom.
6. Dividends
The Company paid an ordinary dividend of 4.5 pence per share, or £34 million
(2023: nil) in respect of the year ended 30 September 2023. The dividend was
paid on 22 March 2024, with a record date of 23 February 2024.
An ordinary dividend in respect of the year ended 30 September 2024 of 12.1
pence per share, or £92 million, based on 20% headline profit after tax, is
to be proposed at the forthcoming Annual General Meeting. These financial
statements do not reflect this proposed dividend.
7. Property, plant and equipment
Owned assets Right of use assets Total
Aircraft and spares Land and buildings Other Aircraft Other
£ million £ million £ million £ million £ million £ million
Cost
At 1 October 2023 5,396 44 78 2,652 48 8,218
Additions 752 - 14 605 62 1,433
Aircraft sold and leased back (248) - - 46 - (202)
Disposals(1) (55) - (27) (326) (7) (415)
At 30 September 2024 5,845 44 65 2,977 103 9,034
Accumulated depreciation
At 1 October 2023 1,550 - 32 1,747 25 3,354
Charge for the year 269 - 8 440 10 727
Aircraft sold and leased back (135) - - - - (135)
Disposals(1) (31) - (24) (326) (6) (387)
At 30 September 2024 1,653 - 16 1,861 29 3,559
Net book value
At 30 September 2024 4,192 44 49 1,116 74 5,475
At 1 October 2023 3,846 44 46 905 23 4,864
Owned assets Right of use assets Total
Aircraft and spares Land and buildings Other Aircraft Other
£ million £ million £ million £ million £ million £ million
Cost
At 1 October 2022 4,988 44 68 2,416 45 7,561
Additions 604 - 14 292 18 928
Aircraft sold and leased back (165) - - 44 - (121)
Disposals (31) - (4) (100) (15) (150)
At 30 September 2023 5,396 44 78 2,652 48 8,218
Accumulated depreciation
1 October 2022 1,390 - 28 1,479 35 2,932
Charge for the year 263 - 8 368 5 644
Aircraft sold and leased back (86) - - - - (86)
Disposals (17) - (4) (100) (15) (136)
At 30 September 2023 1,550 - 32 1,747 25 3,354
Net book value
At 30 September 2023 3,846 44 46 905 23 4,864
At 1 October 2022 3,598 44 40 937 10 4,629
The net book value of aircraft includes £519 million (2023: £569 million)
relating to advance payments for future deliveries and life limited parts not
yet in use. This amount is not depreciated.
The net book value of aircraft spares is £157 million (2023: £112 million).
The 'Other' categories are principally comprised of leasehold improvements,
computer hardware, leasehold property, fixtures, fittings and equipment, and
work in progress in respect of property, plant and equipment projects. The
work in progress as at 30 September 2024 was £15 million (2023: £14
million).
As at 30 September 2024, easyJet was contractually committed to the
acquisition of one CFM LEAP engine (2023: two), and 299 (2023: 158) Airbus
A320 family aircraft, with a total estimated list price(2) of $36.2 billion
(2023: $18.1 billion) before escalations and discounts, for delivery in
financial years 2025 (9 aircraft), 2026 and 2027 (59 aircraft) and 2028 to
2034 (231 aircraft). Additionally, easyJet maintains purchase rights for a
further 100 aircraft.
At the year-end date easyJet had no commitment (2023: six) for aircraft lease
contracts, where the aircraft had not been delivered.
1) Right of use asset disposals includes the transactions to remove
the fully depreciated assets from the statement of financial position when the
leased assets are returned.
2) As Airbus no longer publishes list prices, the last available
list price published in January 2018 has been used for the estimated list
price.
8. Borrowings
Current Non-current Total
£ million £ million £ million
At 30 September 2024
Eurobonds 416 1,690 2,106
416 1,690 2,106
Current Non-current Total
£ million £ million £ million
At 30 September 2023
Eurobonds 433 1,462 1,895
433 1,462 1,895
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 October 2016 €500 million Eurobond with a carrying value of £433
million was repaid in October 2023. In addition, in March 2024, a €850
million Eurobond was issued with a value of £718 million (net of issue
costs).
9. Provisions for liabilities and charges
Maintenance provisions Restructuring Other provisions Total provisions
£ million £ million £ million £ million
At 1 October 2023 753 6 42 801
Exchange adjustments (67) (1) (1) (69)
Release of provisions (2) (3) (10) (15)
Additional provisions recognised 315 12 28 355
Updated discount rates net of unwind of discount (12) - - (12)
Utilised (93) (2) (3) (98)
At 30 September 2024 894 12 56 962
Maintenance provisions Restructuring Other provisions Total provisions
£ million £ million £ million £ million
At 1 October 2022 636 15 40 691
Exchange adjustments (44) - - (44)
Release of provisions - (5) (6) (11)
Additional provisions recognized 257 6 17 280
Updated discount rates net of unwind of discount (30) - - (30)
Utilised (66) (10) (9) (85)
At 30 September 2023 753 6 42 801
The maintenance provisions provide for 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.
2024 2023
£ million £ million
Current 156 175
Non-current 806 626
962 801
The split of the current/non-current maintenance provision is based on the
expected maintenance event timings. If actual aircraft usage varies from
expectation the timing of the utilisation of the maintenance provision could
result in a material change in the classification between current and
non-current. Maintenance provisions are expected to be utilised within seven
years.
Within other provisions are provisions for litigation matters. The split of
these provisions between current/non-current is based on the dates of expected
court judgements. Provisions for restructuring could be fully utilised within
one year from 30 September 2024 and therefore are classified as current.
10. Reconciliation of operating profit to cash generated from operations
2024 2023
£ million (re-presented)
£ million
Operating profit 589 453
Adjustments for non-cash items:
Depreciation 727 644
Loss on disposal of property, plant and equipment 18 14
(Gain)/loss on sale and leaseback (1) -
Amortisation of intangible assets 43 29
Share-based payments 30 18
Loss on disposal of other intangible assets 1 3
Changes in working capital and other items of an operating nature:
Increase in trade and other receivables (130) (16)
Increase in intangible assets (8) (179)
(Decrease)/increase in trade and other payables (45) 120
Increase in unearned revenue 240 458
Post employment benefit contributions (12) (2)
Increase/(decrease) in provisions(1) 31 (94)
Decrease in other non-current assets(1) 10 47
(Decrease)/increase in derivative financial instruments (10) 14
Cash generated from operations 1,483 1,509
1) The non-cash element of £87 million within lessor maintenance
contributions has been re-presented between provisions and other non-current
assets.
11. Reconciliation of net cash flow to movement in net cash/(debt)
1 October 2023 Foreign exchange New debt raised in the year Repayment of capital Other(1) Cash, cash equivalents and other investments movement 30 September 2024
£ million £ million £ million £ million £ million £ million £ million
Cash and cash equivalents 2,925 (136) - - - (1,446) 1,343
Other investments - 2,118 2,118
2,925 (136) - - - 672 3,461
Eurobond (1,895) 77 (718) 434 (4) - (2,106)
Lease liabilities (989) 91 (228) 222 (270) - (1,174)
(2,884) 168 (946) 656 (274) - (3,280)
Net cash/(debt) 41 32 (946) 656 (274) 672 181
1) Other includes deferred fees, lease extensions and rate changes.
Other investments include term deposits, tri-party repos and managed
investments where the original duration of the investment was more than three
months.
12. Contingent liabilities and commitments
Contingent liabilities
easyJet previously disclosed an ICO investigation into a cyberattack and data
breach that took place in 2020. Whilst the ICO investigation is now closed, an
associated group action by a law firm representing a class of customers
affected by the data breach arising from the cyberattack remains in place and,
as previously highlighted, other claims have been commenced or threatened in
certain other courts and jurisdictions. The merit, likely outcome, and
potential impact of these actions are subject to significant uncertainties and
therefore the Group is unable to assess the likely outcome or quantum of the
claims and as such a provision is not included in these financial statements.
The Spanish Ministerio de Consumo (Ministry of Consumer Affairs) has issued
easyJet with a €29 million fine for its hand luggage policy and the charges
applied to cabin bags. easyJet is appealing this and believes its policy is
entirely lawful. On this basis, easyJet does not consider it appropriate to
recognise a provision for the charge.
Additionally, there is an ongoing litigation matter in Italy, and a
possibility of a claim being made by a third-party supplier, for what would be
material recoveries. Management has assessed the likelihood of each case being
brought, easyJet's response and likelihood of a successful defence, and at
this stage, having taken external legal advice, does not consider it
appropriate to provide for either matter.
easyJet is involved in a number of other disputes and litigation cases which
arose in the normal course of business. The potential outcome of these
disputes and litigations can cover a range of scenarios, and in complex cases
reliable estimates of any potential obligation may not be possible.
Contingent commitments
Letters of credit and performance bonds
At 30 September 2024, easyJet had outstanding letters of credit and
performance bonds totalling £47 million (2023: £45 million), of which £9
million (2023: £12 million) expires within one year. The fair value of these
instruments at each year end was negligible.
No amount is recognised on 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 and the fair value has been assessed to be £nil.
Pathway to net zero
On 26 September 2022, easyJet announced its pathway to net zero. This roadmap
references several partnerships with other commercial companies to explore
certain technologies which may assist with the overall goal to decarbonise the
aviation industry. The majority of these partnerships are in fact agreements
to work together on the areas identified and do not involve a financial
commitment from easyJet other than the time and effort involved in the
collaboration over an agreed period. Where there is a signed agreement
requiring a financial commitment from easyJet in the future, any future
payments are contingent on project progress or product/service delivery and
are therefore not certain, hence no liability has been recognised for these
payments.
13. Government grants and assistance
During the year ended 30 September 2024, easyJet Airline Company Limited
claimed 'activité partielle longue durée', long-term partial activity
(APLD), a scheme implemented by the French Government under which, subject to
agreement with trade unions, it is possible to reduce the activity of
employees, within the limit of 50% of their legal working time, while
maintaining a compensation funded by the Government. The total amount claimed
by easyJet companies in the year ended 30 September 2024 amounted to £2
million (2023: £3 million) and is offset within employee costs in the income
statement. There are no unfulfilled conditions or contingencies relating to
this scheme and easyJet stopped claims at the end of February 2024 under this
scheme.
In June 2023 easyJet Airline Company Limited entered into a five-year term
loan facility of $1.75 billion (with easyJet plc as guarantor), underwritten
by a syndicate of banks and supported by a partial guarantee from UK Export
Finance under their Export Development Guarantee scheme. The Export
Development Guarantee scheme for commercial loans is available to qualifying
UK companies, does not carry preferential rates or require state aid approval,
but does contain some restrictive covenants including dividend payments.
However, these restrictive covenants are compatible with easyJet's existing
policies. Embedded within the facility is a sustainability key performance
indicator linked to a reduction in carbon emission intensity in line with
easyJet's SBTi validated target, with a margin adjustment mechanism (upward or
downward) conditional on the achievement of specific milestones. This term
loan facility remains undrawn at 30 September 2024.
14. Related party transactions
The Company licences the easyJet brand from easyGroup Limited ('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 30 September 2024
(2023: 15.27%).
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 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 2 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 are as follows:
2024 2023
£ million £ million
Annual royalty 23 20
Brand protection (legal fees paid through easyGroup to third parties) 1 1
24 21
At 30 September 2024, £3 million (2023: £6 million) was payable to
easyGroup.
15. Events after the statement of financial position date
After the statement of financial position date of 30 September 2024,
· in October 2024, three A321NEO and one A320NEO aircraft were
delivered by Airbus to easyJet.
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