2. 3
Why easyJet
• easyJet shares skyrocketed from GBP 390 in January 2012 to GBP 1,770 in
April 2014; 4.54 times or 354% appreciation!
3. 26
Continued opportunity for easyJet
Source:
Market share growth rates from OAG. easyJet routes based on internal easyJet definition. Based October download for the six months to 31
Capacity growth H1‘ F’14 (OAG)
Taking advantage of competitor restructuring, improving network
%of easyJet
capacity
touching
country
1.
Network
UK
33%
France
13%
Italy
12%
-9%
Switzerland
10%
Spain
9%
Germany
6%
2%
-4%
0%
-0%
-2%
-2%
2%
1%
-6%
-4%
3%
4%
2%
2%
4%
-4%
3%
Total capacity change - easyJet markets Competitors on easyJet markets easyJet capacity change
March 2014. Adjustment made to forward looking easyJet capacity to reflect the latest view of fleet growth.
4. 27
• easyJet has a strong position across much of Europe on the top 100 markets
• From all the EU city pairs, the top 100 routes have a 24% capacity share
• Over 75% of our capacity is at airports where we have a leading position
Leading position in top market pairs
No.1
31m
46%
No. 2
21m
30%
Other
16m
24%
easyJet
Ryanair
IAG
LufthansaGroup
AirFrance-KLM
Norwegian
Alitalia
SAS
AirBerlin-NIKI
VuelingAirlines
TurkishAirlines
Presence in top 100 market pairs
1
Non primary airports
1
Presence in top 100 market pairs
Source: OAG, easyJet
Airports where easyJet has
number 1or 2 market share
48
18
37 Number of market pairs
operated between 2 primary
airports
2
24 24
2221
19
17 16
14
3
5. 8
Strong unit revenue growth
Source:
Competitor capacity from OAG using an easyJet definition of overlapping markets. This excludes charter capacity.
£m F '13 F '12 Change
Passengers (m) 60.8 58.4 4.0%
Load factor (%) 89.3% 88.7% +0.6ppt
Seats (m) 68.0 65.9 3.3%
Average sector length (km) 1,091 1,096 (0.5%)
Total revenue (£m) 4,258 3,854 10.5%
Total revenue per seat (£) 62.58 58.51 7.0%
@ constant currency (£) 62.65 58.51 7.1%
6. 30
34
35
36
37
38
39
40
41
FY10 FY11 FY12 FY13
Source:
• Great service: surveys conducted by Millward Brown & GfK for 12months to end September 2013
UK
Spain
France
Germany
Italy
Switzerland
Portugal
Netherlands
Demand: Understanding evolving customer base
UK France Italy Switzerland Germany
Older passengers, higher disposable incomes
Average age
FY'10 FY'13
Increasingly pan-European customer base
FY’10 FY’13
Great service: “consider flying easyJet again?” Increased proportion customers re-booking
Customer
50% 45%
50%
55%
Volumes
New
Exising
UK47%
France
12%
Italy8%
Switzerland
7%
Other
26%
UK44%
France
14%
Italy13%
Switzerland
10%
Other19%
98%
• Other data from internal easyJet systems
95%
96%
97%
96%
8. 33
Allocated seating has been a success
Most popular seats
Introduced variable pricing on allocated seating from start of November
H2 performance Allocated seating
Impact on revenue per seat c.62p increase
% of RPS growth c.+1 percentage point
Satisfaction with boarding
experience
+4.5 pp
Now 73%
9. 37
Crew
Airports
& ground
handling
Other &
Fixed
Engineering
Fuel
efficiency
Navigation
Ownership
Sales and
marketing
EasyJet Lean – lowest cost for our network
1. Areas of focus for FY’14
Innovative thinking to drive long-term, sustainable savings, benchmarked
against the best in class
• On-going delivery of key initiatives:
• Ground ops: ground handling &
non-regulated airports
• Crew settlements & flexibility
• Engineering
2. Longer term programmes
• Plans in place for significant longer
term deliverables:
• Fuel: sharklets, lightweight seats
• Navigation
• Engineering
easyJet
Lean
10. 15
Increasing proportion of A320’s
F '13 F '12 Change
A319 (operating lease) 54 49 5
A319 (owned / finance lease) 99 111 (12)
A319 Total 153 160 (7)
A320 (operating lease) 18 6 12
A320 (owned / finance lease) 46 48 (2)
A320 Total 64 54 10
Total fleet 217 214 3
Operating lease 33% 26% 7ppt
Percentage unencumbered 36% 32% 4ppt
Percentage of A320s in fleet 29% 25% 4ppt
11. 36
Lowest cost base
EBIT Cost perASK(excl. fuel) (1) easyJet cost advantage
• easyJet Lean
• Continued focus on on-time
performance and asset utilisation
• New fleet order
• Fuel efficiency
• new generation aircraft expected
to reduce today’s total cost per
seat by 4-5%(2)
Difficulties with comparisons
• Airport mix: primary vs. secondary
• Accounting treatment e.g. passenger
airport charges (3,4)
• Sector length
12mend31
Mar’13
1. 12months to end of March 2013; CASK data and definitions sourced from the Airline Analyst
2. Cost saving for new generation aircraft assumes fuel at $1,100 / MT, compares current generation A320 aircraft vs. new generation A320neo aircraft
3. Differences in accounting treatment of per passenger airport costs as per accounting standard
4. easyJet believes its current reporting appropriately reflects its business model in relation to the standard
1.6
Ryanair 0.8
2.0
2.1
3.1
2.8
4.4
4.5
easyJet
Vueling
Norwegian
IAG
Air Berlin
AF-KLM
LHA (Group)
Staff, depreciation, maintenance, ownership, marketing, head office
Airport, ground handling, navigation en-route charges
12. 13
Cost per seat excluding fuel - key drivers
Favourable/
(Adverse)
£ Cost per
seat ex fuel
£ var at
constant
currency
% var at
constant
currency
Drivers
Airports and Ground
Handling
15.84 (1.14) (7.9%)
• Significant increases in airport charges in
Spain and Italy
• Increased de-icing related costs
Crew 6.68 (0.08) (1.1%)
• Increase in salaries, offset by higher
proportion of A320s and shorter sector length
Navigation 4.33 0.02 0.5%
• Price increases more than offset by higher
proportion of A320s and shorter sector length
Maintenance 3.11 - 0.2%
• One-off items from last year not repeated,
offset by above inflation price increases and
increase in average fleet age
Overhead 4.64 (0.08) (2.1%)
• Higher disruption-related costs including
EU261claims, relating to prolonged winter
conditions and strike action
• Increase in performance related employee
costs
Brand licence 0.16 (0.08) (108.2%)
• As per the amended brand license
agreement, now fixed percentage of revenue
Ownership 3.41 (0.05) (1.4%)
• Increased proportion of leased aircraft,
following new leases and sale and leaseback
transactions
• Savings on interest cost from paying off high
coupon debt
Total CPS excluding fuel 38.17 (1.41) (3.9%)
13. 48
RASK and CASK
F '13 F '12 Change
Total revenue per seat 62.58 58.51 7.0%
at constant currency 62.65 58.51 7.1%
RASK at constant currency (pence) 5.74 5.34 7.6%
Total cost per seat ex fuel 38.17 36.25 5.3%
at constant currency 37.66 36.25 (3.9%)
CASK ex fuel at constant currency (pence) 3.45 3.31 (4.4%)
17. 3
Independent analysts forecasts
• Share price forecast. The 24 analysts offering 12 month price targets for easyJet plc have
a median target of 1,820. It represents a 18.95% increase.
• In 2013, easyJet plc reported a dividend of 0.34 GBP, which represents a 40.24%
increase over last year. The 19 analysts covering the company expect dividends of 0.37
GBP for the upcoming fiscal year, an increase of 11.04%
18. 3
SWOT
Strengths Weaknesses Opportunities Threats
Strong position in
the key aviation
markets of
Europe
Lack of
geographic
diversification
Growing
international
tourism
Increasing
charges at
regulated airports
Robust capital
structure and
liquidity
Dispute between
the founder and
the board of
easyJet
adversely impact
the brand image
Network
expansion to
enhance
coverage and
drive growth
Intense
competition and
price discounting
Competitive and
flexible business
model
Key agreements
19. 3
Strengths
•Strong position in Europe:
- Connect top 100 city to city market pairs than any other
airlines
- 4th largest short-haul carrier in Europe (8% MS)
- 31% MS in UK for intra-European market
-3rd most searched airlines, with 370M visits in 2013
•Financials (from 2012 to 2013):
-Revenue grew by 10.5%
-Operating profit grew by 50.2%
-Net profit grew by 56.1%
- ROCE grew by 6.1%
20. 3
Weaknesses
• Lack of geographic diversification:
-Risk is born with the current political and economic
uncertainty of the European region which creates
challenges of regulation and government.
-Air traffic control costs are about double in Europe than
they are in the US
• Dispute between founder and the board:
- Sir Stelios (quit in 2010) raised dispute regarding the
strategy and threatened to sell shares if the company
buys more planes. Results, included drop in share
prices.
21. 3
Opportunities
• Growing international tourism:
-2nd largest industry in the worls, recovered since
downfall of ‘08-’09 and European arrivals increased
by 5% in 2013
• Network expansion to enhance coverage and drive
growth:
- Launched 10 and 5 new routes in 2013 & 2014,
respectively.
22. 3
Threats
• Increasing charges at regulated airports
- 70% of total airport costs comes from regulated
airports, as there have been above inflationary cost
increases in 2013-2014.
- Due to new and increased aviation taxes, 2%
increase costs per seat are projected.
