easyJet PLC EZJ easyJet announcement on its Madrid base

  easyJet PLC (EZJ) - easyJet announcement on its Madrid base

RNS Number : 8047F
easyJet PLC
20 June 2012
 



 

                                                                  20 June 2012

                                       

                   easyJet announcement on its Madrid base

                                       

easyJet today announced that after a thorough review of its Madrid  operations 
it proposes to cease basing crew and aircraft at Madrid from Winter  2012/13.  
easyJet intends to continue to serve Spain but to do so differently by  moving 
its aircraft to  other easyJet bases  around its European  network which  will 
deliver higher returns for the airline.

 

The Madrid base is delivering returns below all of easyJet's other bases. This
is due  to a  combination of  over  capacity in  the Spanish  airline  market, 
leading to low revenue per passenger, combined with high airport charges which
have more than doubled in  the last two years and  will be subject to  further 
above inflation increases in the coming years.

 

easyJet remains committed to Spain, including Madrid, and will continue to fly
to and from Spain out of its  bases across Europe.  While easyJet proposes  to 
reduce its capacity to  and from Madrid  by around 20%  in the next  financial 
year, the reduction to and from Spain will be 7%.  After the proposed  changes 
easyJet expects to  carry over 12  million passengers to  and from Spain  next 
year.  

 

70% of passengers on easyJet's Spanish flights start their journey from  other 
parts of Europe and demand from these passengers remains strong.  Madrid based
customers will  also continue  to benefit  from easyJet's  services after  the 
proposed transfer as easyJet will operate to Madrid from many of Europe's most
popular cities.  easyJet operates over 200 aircraft across 23 bases in the  UK 
and mainland Europe.

 

The airline is now  reviewing a range  of options for  its eight Madrid  based 
aircraft and 310 crew.  All of easyJet's pilots and cabin crew in Madrid  will 
be offered a job in the airline's  other bases and easyJet hopes to retain  as 
many of its people  as possible.  easyJet will  discuss the proposal with  the 
easyJet European  Works  Council and  the  local employee  representatives  as 
appropriate. 

 

Any restructuring costs arising out of this proposal will be accounted for  in 
the current financial  year. The  market price of  jet fuel  has fallen  since 
easyJet's outlook statement set  out in its Half  Year Results statement of  9 
May 2012.  Assuming  the current  fuel  price environment  continues  for  the 
remainder of the year, the benefit from lower fuel prices should fully  offset 
any restructuring  costs.  Consequently  management  expectations  for  profit 
before tax for the financial year ending 30 September 2012 remain unchanged.

easyJet expects  its capacity  to increase  by around  5% in  the year  ending 
September 2012,  compared  to  2011, and  to  continue  to grow  in  the  next 
financial year.  easyJet's strategy  of low fares and  our focus on making  it 
easy for  our  customers, aligned  with  tight cost  management  and  strictly 
managed allocation  of capital,  ensures that  easyJet is  well positioned  to 
deliver good results for shareholders. 

 End

Enquiries should be directed to:

easyJet plc

Investors:

Rachel Kentleton, Investor Relations         +44 (0) 7961 754 468

Tom Oliver, Investor Relations                    +44 (0) 7950 996 262

 

Media:

Paul Moore, Communications                     +44 (0) 1582 525 973

                                                                     +44 (0)
7860 794 444

 

Edward Simpkins, RLM Finsbury                  +44 (0) 7947 740 551

 

                     This information is provided by RNS
           The company news service from the London Stock Exchange
 
END
 
 
MSCFMMITMBBTBFT -0- Jun/20/2012 15:00 GMT