EasyJet, the biggest airline operating in Scotland, delighted investors yesterday with a high-flying set of results, but even a doubling of the dividend failed to quieten its founder and rebel shareholder.
Sir Stelios Haji-Ioannou has been waging war on the easyJet board over its remuneration and aircraft investment plans. He has also called for chairman Sir Michael Rake to step down, claiming he is too busy.
Yesterday, despite the budget carrier's 38% rise in pre-tax profit to a record £317 million on revenues up 11% to £3.85 billion, and a 5% jump in the share price as the dividend was hiked from 10.5p to 21p, a spokesman for Sir Stelios said: "Mike Rake has got too many fingers in too many pies - there are still questions remaining."
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He said Sir Stelios was claiming a couple of victories: in the raising of the dividend from one-fifth to one-third of pre-tax profit; and the efficient utilisation of the existing fleet.
"The cash that will be spent on the dividend and paying down debt suggests this is not a company about to go on a spending spree for new aircraft, which is the last thing we want given the situation in Europe."
Carolyn McCall, easyJet's chief executive, said: "The strength of easyJet's business model and strategy coupled with the hard work and dedication of the easyJet team has delivered record profits as well as a significant increase in returns for shareholders during the year."
She said shareholders would "benefit from easyJet's success with £85m of dividends", adding that the figures "demonstrate easyJet is a structural winner in the European short-haul market against both legacy and low-cost competition".
Pre-tax profit margins were up from 7.2% to 8.2% despite a £182m increase in unit fuel costs; passenger numbers rose 7.1% to 58.4 million; and return on capital jumped from 9.8% to 11.3%.
Load factors were up from 87.3% to 88.7%, with revenue per seat up by an underlying 7.5%.
Part of the improvement was down to the increased proportion of larger A320 aircraft in the fleet, easyJet said, and to exceptionally low levels of disruption compared with previous years.
EasyJet carried more than 4.5 million passengers to and from its four Scottish airports in the year to June, and expects that to reach almost 5 million in the current year. The airline will fly six new routes from Edinburgh next March, including the capital's first direct flights to Berlin, Hamburg and Reykjavik, creating 160 jobs and adding 140,000 passengers a year.
Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers, said: "Set against the difficulties the industry has been facing, typified by the recent Iberia announcement [of a major restructuring], easyJet has managed to shoot the lights out."
Analysts at Oriel Securities said: "We continue to believe the shares are cheap ... the change to the dividend policy is a strong signal of confidence in the future."
Espirito Santo's analysts said the current year would be "relatively subdued - with cost headwinds from fuel, exchange rates, higher airport charges and a more normal level of operational disruption".