Directorate Change

RNS Number : 9837L

easyJet PLC

14 May 2010

 



14 May 2010

easyJet plc ("easyJet" or the "Company") announces the resignation of Sir Stelios Haji-Ioannou and Bob Rothenberg MBE from the Board of easyJet

easyJet received today notice that Sir Stelios Haji-Ioannou and Bob Rothenberg MBE have resigned from the Board of easyJet plc with immediate effect. Both individuals sit as representatives of easyGroup, a 26.2% shareholder of easyJet.

The stated reason for their resignation is that Sir Stelios Haji-Ioannou wishes to gain greater freedom to exercise easyGroup's rights as a shareholder in the Company to seek a change in the Company's strategy.

The Board of easyJet wishes to make it clear that all decisions about strategy and the allocation of capital have been made by the full plc Board and where necessary agreed by shareholders, further details of the approval process are set out in Appendix 1.

easyJet's growth rate is approved by the Board each year as part of its five year planning process. At the last such meeting in June 2009 the Board unanimously agreed a fleet plan of around 7.5% growth per annum over the medium term. This fleet plan will enable easyJet to grow its share of the European short-haul market from around today's 7% to approximately 10%. The Board of easyJet is also committed to ensuring that the Company achieves a proper financial return on its capital and therefore has set a target of 15% Return on Equity.

The legal action with easyGroup over the clarification of the brand licence agreement continues. The principal subject matters at issue remain the clarification of "the 75:25 Rule" and the classification of certain revenue streams affecting that clarification.  The court hearing is scheduled for early June 2010 and a decision from the courts is not expected until Autumn 2010. We remain reassured by robust advice from our professional advisers that the Company's interpretation of the brand licence is well-founded.

Sir Mike Rake, easyJet's Chairman, commented:

"The Board of easyJet annually reviews the Company's medium term growth rate, and at the last such review in June 2009 the Board unanimously agreed the 7.5% medium term growth rate. As is the ordinary course the Board will conduct its next annual review over the summer in conjunction with the new management team. Therefore, I regret and am surprised at Stelios' decision to resign from the Board.

The Board believes that easyJet has been one of the best performing airlines during the recession. It was one of only a very few to be profitable in 2009 with a pre-tax profit of £44 million. In its 11 May 2010 interim results statement the Board estimated that pre-tax profit will increase to between £100 million and £150 million at current fuel and exchange rates¹, even after absorbing estimated volcanic disruption costs of between £50 million and 75 million. Importantly easyJet is well financed and has maintained a strong balance sheet."

Note 1: Rates as at noon on 10 May 2010: US$1.50/£, €1.15/£ and US$738 per metric tonne.

For further details please contact easyJet plc: 

Institutional investors and sale side analysts:

Rachel Kentleton                       Investor Relations                       [phone]

Media:

Oliver Aust                                Corporate Communications         [phone]

Tim Spratt / Ben Foster              Financial Dynamics                    [phone] 

Appendix 1 - approval process for aircraft orders

Under the terms of its arrangement with Airbus easyJet has the right to order a maximum of 315 aircraft; to date easyJet has placed orders for 227 aircraft of which 172 have been delivered. easyJet's arrangements with Airbus were subject to Class 1 circulars in 2002 and 2006. These circulars received shareholder approval. The full text of the Class 1 circulars is available at:

http://corporate.easyjet.com/investors/shareholder-services/shareholder-circulars.aspx

Date	Action	Approval process	Firm orders	Options	Purchase rights	Total
30 Dec 2002	Purchase Agreement for 120 Firm Purchase Aircraft plus 120 Purchase Rights	Circular to shareholders 'Proposed Purchase of Airbus Aircraft', 24 February 2003 Percentage of votes cast in favour: 99.4%	120	-	120	240
21 Dec 2005	Conversion of 20 Purchase Rights into Firm Purchase Aircraft (Amendment No.1)	Approval from plc Board	140	-	100	240
13 Nov 2006	Conversion of 52 Purchase Rights into Firm Purchase Aircraft plus an additional 75 Purchase Rights (Amendment No.2)	Circular to shareholders 'Proposed Purchase of 52 Airbus Aircraft - Amendment of the Airbus Contract', 28 November 2006 Percentage of votes cast in favour: 94.5%	192	-	123	315
June 2007	Conversion of 35 Purchase Rights into Firm Purchase Aircraft plus conversion of 24 Purchase Rights into Options (Amendment No.3)	Approval from plc Board	227	24	64	315

 

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