EasyJet reveals £150m divi pay-out as it bids to heal rift with Stelios

Budget airline EasyJet yesterday unveiled a one-off dividend of £150 million as it looks to cool a feud with its founder and major shareholder.

Sir Stelios Haji-Ioannou and his family own a 38 per cent stake in the airline and stand to pick up some £57m as a result of the pay out, which EasyJet said stemmed from better-than-expected trading.

The carrier’s former boss, who stepped down from the form’s board last year, has attacked EasyJet’s expansion plans and called for cash to be returned to investors.

The one-off pay-out is on top of £40m that the group said it will pay as its maiden dividend following 11 years as a stock-market listed company.

EasyJet said the dividend and one-off payment to shareholders will be declared in its full-year results in November and paid in early 2012.

Chief executive Carolyn McCall added: “Our performance continues to be robust, with particular strength on city routes used by business and short break leisure travellers.”

McCall added that EasyJet was obliged to call an extraordinary general meeting after Stelios requested a vote over plans to buy planes and will do so soon.

The airline said profits in the year to 30 September were likely to be between £240m and £250m, compared with previous expectations of between £200m and £230m. Revenues per seat were 6 per cent higher in the second half of the financial year and up 3 per cent up for the full year.

It has also benefited from its continued focus on costs, while the percentage of flights arriving on time stood at 80 per cent in July and 85 per cent in August.

EasyJet said the June launch of Flexi Fare – a service that allows passengers to change the date of their flight up to two hours before the scheduled departure time – had proved popular with corporate travellers.

But the carrier warned that, at current prices and exchange rates, its 2012 fuel bill would probably increase by about £220m compared to the previous year. Fuel cost rises tend to weigh more on price-sensitive flights used by tourists and leisure travellers.

Despite a recent rebound in economy class travel, rising fuel prices continue to cause trouble for the industry and will knock airline profits by around one-third in 2012, hindering the industry’s recovery, industry body IATA said on Tuesday.

Espirito Santo analyst Gerald Khoo said: “Current trading is clearly encouraging and contrasts clearly with the recent profit warning from Lufthansa.

“This supports our view that the low-cost carriers are likely to perform relatively robustly compared with the network carriers in tough trading conditions.”

The German carrier warned on Tuesday of disappointing bookings and said it did not expect to beat last year’s profit.