easyJet increased (22-Sep-2011) its pre-tax profit forecast for the year ending 30-Sep-2011 to GBP240-250 million, up from the previous forecast of GBP200-230 million. This equates to a return on capital employed (ROCE) of approximately 12%, the airline said. Net cash flow from operations improved and net cash at the year end is expected to be between GBP50 million and GBP100 million with gearing of approximately 30%. The board expects to pay an ordinary dividend of GBP40 million (GBP9 pence per share) for the year. The board will also recommend a one-off capital return, likely to be structured as a special dividend, of GBP150 million, "in light of the strong performance of the business over the past 12 months". This would equate to a return of GBP44 pence per share and be paid in early 2012, the airline said. "More shareholders are definitely talking about a return of capital in a way they weren’t pre-January," McCall said. “We believe we can afford to pay this extra dividend, and continue to have a very strong balance sheet.”
Other highlights include:
- Forward bookings: A third of seats in the 1Q2012 (three months to 31-Dec-2011) are now booked, easyJet said, a similar level to 1Q2011, "and total revenue per seat continues to show improvement versus the prior year albeit at a lower rate of growth than the strong 4Q2011";
- Cost performance: easyJet estimates at current fuel and exchange rates, its 2012 fuel bill will increase by approximately GBP220 million compared to FY2010. Additionally, the introduction of the Emissions Trading Scheme (ETS) (from 01-Jan-2012); and higher costs at regulated airports in Spain, Italy and the UK are also expected to negatively impact cost performance in FY2012, easyJet warned.
easyJet: "easyJet's commercial performance continues to be robust across the network, with particular strength on city routes used by business and short break leisure travellers. As a result, the increase in total revenue per seat at constant currency for the second half of the year is expected to be towards the upper end of our expectations at around 6% and for the full year will be around 3%." Company statement, 22-Sep-2011.
easyJet: "easyJet's continued focus on cost control for the year has also delivered in line with expectations with good performance in ground handling, aircraft maintenance and disruption related costs as a result of improved operational robustness. easyJet delivered an On Time Performance (OTP) on arrivals of 80% in July and 85% in August with improvements across the network." Company statement, 22-Sep-2011.
easyJet: "easyJet's strong operational and record financial performance this year reflects the successful implementation of our strategy. Despite an increasingly difficult environment for airlines, the strength of easyJet's performance means that it is able to return approximately GBP190 million to shareholders demonstrating the resilience of the model, and that it is well-positioned to continue its success across Europe." Carolyn McCall, CEO. Source: company statement, 22-Sep-2011. [more - original PR]