FY 2017 Analyst & investor presentation 21 November 2017 - PowerPoint PPT Presentation

FY 2017 Analyst & investor presentation 21 November 2017

business review Carolyn McCall- Chief Executive Officer

Proven business model in all market conditions • Strong performance in a tough year • £509m headline PBT (@ constant currency) • Purposeful and disciplined growth; reinforcing our market positions • Capacity growth of 8.5% • Revenue and network differentiate easyJet and drive RPS • Positive revenue trend through 2017 continuing into H1 2018 • Strong cost performance • Headline CPS down 4.4% (@ constant currency) • Strong balance sheet • easyJet Europe established in July 3 3

Robust & sustainable business model Winning Network Strategy Relentless Focus on Cost Lean delivers sustainable savings* 400 85 95 46 32 43 41 58 2011 2012 2013 2014 2015 2016 2018 2011-17 Continuing to Innovate Focused on Our Customers Committe ted d to our People ple * Financial year Lean savings in £ millions 4

H1 growth in European Short Haul market H1 2018 capacity (Oct’17 – Mar’18) Capacity taken out by Ryanair & Monarch in H1 8.7% 8.3% 7.6% 6.9% 5.7% 4.9% 4.2% 3.6% 2017 2018 2017 2018 2017 2018 2017 2018 Capacity change total SH Market Competitors on easyJet markets Capacity Change easyJet markets easyJet capacity change * Data from OAG – Does not include growth from Air Berlin transaction 5

winning network strategy Purposeful investment Protect the profitable core + Capture the national opportunity in France Disciplined use of capital Target investment in key cities + Efficient basing Well positioned in a dynamic market 6

easyJet growth in 2018 c.6% easyJet capacity growth in 2018* XXm 2018 grow owth (seats / %) X% UK 1.3m 5% Netherlands Switzerland 0.2m 5% 0.5m 6% Germany France (0.2)m (5%) 0.8m 7% Italy Spain 0.9m 0.4m 9% 5% * Not including growth from Air Berlin transaction 7

Driving revenue - customer & digital initiatives PERSONALISED BUYING COMMERCIALISED PERSONALISED PRODUCT CONNECTED DIGITAL / INFLIGHT EXPERIENCE CUSTOMER JOURNEY AND OFFERS PEOPLE EXPERIENCE • • • • • Recognising customer to 23m app downloads Allocated seat Empowering our people Worldwide tailor content and conversion +6 ppt since to better serve using • • 24% of customers using Airtime (onboard messages launch of new website digital tools and relevant mobile boarding passes entertainment platform) data • • Launch of new digital 420k+ hands free bags launching on select • 15.6m personalised push • Swiss routes – Nov 30 th ) interface in May 2017 sold since May 2017 Access to purchase notifications sent driving increased history and customer • Launch of pre-order for • App opened over conversion profiles inflight retail 600,000 times each day 8

strong ancillary revenue performance Partner Ancillary revenue performance Extending across the travel value chain FY14-17 (£m) Old “non - seat” Inflight definition World class retail offer with brands you love Product * £986m 6m T argeted options aligned to customer needs Extended £837m 7m “ancillary £770m 0m T ariff £739m 9m revenue” A fair tariff if customer plans change and no definition surprises FY17 FY14 FY15 FY16 FY17P * Product includes but is not limited to the provision of checked baggage, allocated seating, speedy (priority) boarding services, sports equipment 9 9

Relentless focus on cost Lean delivers sustainable savings ** CPS ex fuel target: flat 2015 vs 2019 * 400 85 Lean programme offsets inflation 95 Efficient and effective cost base 46 32 43 2019 CPS 2015 CPS 41 (ex Fuel @ cc)* (ex Fuel @ cc)* 58 2011 2012 2013 2014 2015 2016 2017 2011-17 17 * Flat headline cost per seat excluding fuel at constant currency, excluding hedging, from the 2015 financial year to the 2019 financial year, assuming normal levels of disruption (excludes Air Berlin transaction) 10 **Lean savings in £ millions

delivering operational improvements Focus on operational performance Delivering step change improvements FY 2017 Cancellations LGW H2 OTP Decreased +4.5 ppts by 19% FY 2017 EU261 H2 delays over 3hrs events Decreased Down by 238 3.4% "easyJet has been a real driving force, working with us to help create a world leading bag drop process in North T erminal ” Stewart Wingate, CEO London Gatwick 11

Easyjet Europe > easyJet Europe established in July > easyJet now has three airlines. One based in the UK, Switzerland and Austria • All owned by easyJet plc which itself will be EU owned and controlled, listed on the London Stock Exchange and based in the UK > Above 50% EU (non-UK) ownership required prior to the UK’s exit from the EU • Close to 50% of shares already held in the hands of EEA nationals (excluding UK nationals) > Proposed changes to articles of association relating to ownership 12

Sustainable business model £400m in 60 million easyJet Lean returning Focused on Our Customers savings passengers Winning Network Strategy 23 million app 279 aircraft downloads Relentless Focus on Cost Continuing to Innovate 97.6% touch 97% crew No1 or No2 attendance Strong Balance Sheet airports Co Committed d to our People ple 13

Financial review Andrew Findlay- Chief Financial Officer

Key performance indicators FY 2 2017 FY 2 2016* Change** Seats flown (m) 86.7 79.9 8.5% Passengers (m) 80.2 73.1 9.7% Load factor (%) 92.6% 91.6% +1ppt Average sector length (km) 1,105 1,098 0.6% Revenue per seat - reported currency (£) 58.23 58.46 (0.4%) Revenue per seat - constant currency (£) 55.83 58.46 (4.5%) Headline cost per seat incl fuel - reported currency (£) 53.52 52.28 (2.4%) Headline cost per seat incl fuel - constant currency (£) 49.96 52.28 4.4% Headline cost per seat excl fuel - reported currency (£) 41.27 38.33 (7.7%) Headline cost per seat excl fuel - constant currency (£) 38.69 38.33 (0.9%) * Restated 15 ** Favourable/(adverse)

Financial performance FY 2 2017 FY 2 2016* Change** £ m £ m Total revenue 5,047 4,669 8.1% Headline costs: Headline costs excluding fuel (3,577) (3,061) (16.9%) Fuel (1,062) (1,114) 4.7% Headli line profit before tax 408 494 £(86) ) m Headli line profit before tax at constant currency 509 494 £15 m Non-headline items (23) 13 £(36) m Total l profit before tax 385 507 £(122) 22) m Headline basic earnings per share (pence) 82.5 108.4 (23.9%) Total basic earnings per share (pence) 77.4 110.9 (30.2%) Headline diluted earnings per share (pence) 81.9 107.6 (23.9%) Dividend per share (pence) 40.9 53.8 (24.0%) Headline return on capital employed (%) 11.9% 15.0% (3.1ppt) * Restated 16 ** Favourable/(adverse)

Revenue performance -4.5% £58.46 (5.3%) £3.10 +0.1% +0.3% £55.83 +0.4% £0.08 £0.16 £0.23 FY16 Passenger First Bag Allocated Seating Other FY17 @ PYCC Improvin ing g trend nd in Passen enge ger RPS PS Strong ancillar ary perform rmam amce ce in 2017 (adjus usted for Easter) 4.5% Ancillary RPS Total -6.1% RPS Passenger RPS -9.5% -4.5% -6.5% H1’17 H2’17 17

A strong focus on costs • Total headline cost per seat at constant currency: 4.4% decrease Headline cost per seat bridge • Headline cost per seat ex fuel at constant currency: 0.9% increase 3.56 53.52 0.22 0.23 0.26 0.95 0.26 52.64 2.68 0.34 0.46 52.28 51.92 FY 2017 FY 2016 Regulated Inflation Ownership A320 mix Lean and other Disruption Investment Fuel P&L FX FY 2017 FY 2017 headline headline airports costs in resilience headline headline cost per seat cost per seat inflation cost per seat cost per seat at CC before (restated) at CC before fuel, disruption fuel variance and investment in resilience variance 18

Impact of fuel & currency FY 2017 7 fuel l impact pact FY 2017 FY 2016 Chan ange ge* Fuel el $ per metric ic tonn nne Market rate 501 415 (86) Effective price 596 754 158 US dolla lar rate te Market rate 1.27 1.41 (14 cents) Effective price 1.45 1.57 (12 cents) Difference between market rate and effective rate 0.18 0.16 Actual cost of fuel £ per metric tonne 412 479 67 FY 2017 7 curren ency y impac act t on headline adline PBT* EUR UR CHF USD Othe her Total tal £m £m Revenue 151 42 6 8 207 Fuel (1) - (84) - (85) Headline costs excluding fuel (165) (28) (26) (4) (223) Total (15) 14 (104) 4 (101) 19 *Favourable/(adverse)

Strong cash generation • Net cash: £357m (FY16: £213m) Cash flow bridge • Adjusted net debt: £413m (FY16 restated: £424m)* Cash generated from operations (post tax): £898m Investing and financing 224 630 25 51 325 214 115 1,653 195 404 10 21 3 1,328 969 Cash & MMDs Operating Depn & amort Net working Other Tax paid Ordinary Cash & Sale & Increased CAPEX Own shares Net FX Cash & MMDs at 1 Octobe ober r profit capital operating dividend MMDs post leaseback borrowings interest at 30 2016** (FY’16) di div & tax paid id proceeds Sept ptem embe ber r 2017 ** 20 * Leases capitalised at 7x **Includes money market deposits but excludes restricted cash