easyJet: more aircraft come in as more cash to shareholders goes out. Stelios' baby is in good hands

After exercising its last 27 purchase rights over current generation A320s, easyJet's fleet now looks set to grow from 226 aircraft currently to 304 in FY2019. Although it will remain Europe's number two LCC fleet after Ryanair, it will be able to match the latter's growth rate before its A320 neo deliveries come on stream.

This increased fleet plan reflects easyJet management's confidence in its ability to continue to generate a value-creating return on capital, which was sector-leading in FY2013 and looks set to rise once more in FY2014. Total shareholder returns, which include both capital gains and dividends, have also led the industry. easyJet now proposes to increase its ordinary dividend payout ratio from one third to 40% of net profit.

The company's biggest shareholder, Sir Stelios Haji-Ioannou, a vocal supporter of higher dividends, has been critical of its fleet expansion. At easyJet's recent Investor Day, the airline's management team gave some strong reasons for all shareholders to trust its track record.