http://en.wikipedia.

org/wiki/EasyJet

Full Year Results for the year to 30 September 2009
RESILIENT PERFORMANCE; INCREASED YIELDS, PROFITS IMPACTED BY HIGHER FUEL COSTS Results at a glance 2009 Total revenue (£ million) Profit before tax ± underlying (£ million) Profit before tax ± reported (£ million) Pre tax margin ± underlying (%) Return on equity (%) Basic EPS - reported (pence)
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2008 2,363 123.1 110.2 5.2% 6.8% 19.8

Change 12.9% (64.5)% (50.4)% (3.6)ppt (1.3)ppt (14.6)%

2,667 43.7 54.7 1.6% 5.5% 16.9

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Total revenue per seat up 10.9% (4.1% at constant currency), driven by the strength of the easyJet network, competitor capacity reduction of around 6%, strong ancillary revenue performance and a 2.6% sector length increase Passenger numbers up 3.4% to 45.2 million and load factor improved by 1.4ppt to 85.5% Underlying profit before tax 1 of £43.7 million delivered in line with expectation. The £79.4 million reduction in underlying pre -tax profit compared to the prior year is driven by a unit fuel cost increase equivalent to £86.1 million and interest income lower by £30.5 million Operating costs 2 per seat (excluding fuel and currency movement) increased by 3.9% for the full year. Total underlying cost per seat 1 (excluding fuel and currency movement) up 6.2% partly driven by increased sector length, planned lower aircraft utilisation during the winter and a £30.5 million reduction in interest income Significant progress on cost reduction initiatives: 19 expensive aircraft exited from the fleet; systems implemented; renegotiation of our maintenance arrangements with SRT to deliver savings of around £175 million over the 11 year life of the contract

com/media/latest-news/news-year-2009/17-11-09.a review of strengths. A major strength of any airline is the product i tself -. over time air travel continues to grow. 2010 I want to do this! A SWOT analysis -. Note 2: Excludes interest income.is a core requirement of any organization. even on the same routes. and essential to understand any industry. Both traditional.9 million of costs associated with the integration of GB Airways in 2008. Despite downturns. Milan and Madrid and over a 10% increase in slots at capacity constrained airports Sufficient resources in place through a combination of undrawn committed facilities and surplus cash to fund future aircraft deliveries for at least the next 18 months Forward bookings broadly in line with prior year Note 1: Underlying financial performance excludes an £11. airlines have the ability to segment the market. The volatile airline industry is no exception.0 million profit on the disposal of three aircraft in 2009 and £12. While individual airlines each analyze and make decisions based on their own situations. with each endeavoring to maximize strengths and opportunities while minimizing weaknesses and threats. opportunities. from pilots and flight attendants to mechanics and ground staff. Strengths 1. but also due to an increased propensity to fly. . Airline staff is highly trained and experienced. there are overall industry similarities that all airlines face. not only due to population growth.air travel.aspx Airline Industry SWOT Analysis By Jeff Fulton. Business-wise. and threats -. and the as sociated public acceptance of air travel as both a fast and safe way to travel.easyjet. http://corporate.y y y easyJet¶s position in European short-haul aviation has strengthened with market share gains in a number of valuable markets such as Paris. London Gatwick. brand recognized airlines and new low cost carriers share this strength. Another strength is the safety record. weaknesses. This allows airlines to establish different levels of service and make associated pricing decisions. eHow Contributor updated: September 13.

Once a flight leaves the gate. require continual communication and monitoring.com http://www. Large workforces spread over large geographic areas. airlines have difficulty making quick schedule and aircraft changes due to leases.g. optional travel. By coordinating schedules. A plague or terrorist attack anywhere in the world can negatively affect air travel. Airlines have a high "spoilage" rate compared to most other industries.ehow. airlines can offer service to destinations via a code share agreement with a partner carrier. Link-ups with other carriers can greatly increase passenger volum es. e.Weaknesses 2.com/about_5347649_airline -industry-swot-analysis. Aircraft is expensive and requires huge capital outlays. Opportunities 3. This can be exacerbated during operational irregularities. Technology advances can result in cost savings. from more fuel efficient aircraft to more automated processes on the ground.html#ixzz14JDrWzro . staffing commitments and other factors. Airline market growth offers continual expansion opportunities for both leisure an d business destinations. Read more: Airline Industry SWOT Analysis | eHow. Threats 4. This is particularly true for international destinations. An upward spike can destabilize the business model. The price of fuel is now the greatest cost for many airlines. as well as business travel. including international points. Government intervention can result in new costly rules or unexpected new int ernational competition. The return on investment can be different than planned. While the business climate can change quickly. A global economic downturn negatively affects leisure. Technology can also result in increased revenue due to customer-friendly service enhancements like in -flight Internet access and other value-added products for which a customer will pay extra. bad weather. an empty seat is lost and non -revenue producing.

y They have a highly distinctive livery on their fleet of aircraft making them easily recognisable and distinguishing them from their competitors. Weaknesses: y Domestic air travel is an extremely competitive industry with EasyJet¶s main competitors being Jet2. y Recognised as a leading brand name in the UK travel industry.http://www. This enables them to maintain a reliable and hassle free service to their passengers. y They have a user friendly website which fully discloses the price breakdown of the passengers planned travel. y They do not offer a free food service on longer flights of 2 hours plus. no frills air travel servicing many of the leading city destinations in the UK and across Europe. and Prague. y As a market leader in an industry widely seen as a leading contributor to the green house effect and global warming. These external competitive forces can restrict and shape pricing policy on some of EasyJet¶s less profitable routes as they seek to compete with their competitors. including Berlin. y EasyJet operate a fast and efficient service with an average turnaround time of 30 minutes or below. Amsterdam.businessteacher. EasyJet actively embrace there environmental responsibilities and continue to keep these factors as a keep priority when developing their future strategies. y They offer a high quality service at competitive prices and offer a number of features including ticketless travel. Ryan Air plus a host of smaller independent competitors. Offering a full breakdown of the price plan prevents any hidden charges when the customer confirms there booking. Barcelona. internet booking and assisted travel services. y EasyJet offers an online promotion alert which is e-mailed to existing customers and contact on the company¶s database.uk/business-resources/swot-analysis-database/easyjet-swotanalysis/ EasyJet Airline Company Limited: Strengths: y EasyJet is a leading provider of low budget. .org. BMI Baby.

answers.g. 'budget airlines have captured almost one-fifth of the .Opportunities: y Possible opening of alternative routes to major cities in Europe. e. A key route could be from Dublin to the UK. the rising cost of oil can have a significant impact on running costs putting significant pressure on the profitability of less popular routes and time slots. The low cost carriers compete by price. non-price competition is not really an option. y External market forces can have a significant impact on EasyJet¶s business. as this has a large potential for travellers going to soccer matches in the UK plus new links into corporate flyers to and from the UK.yahoo. y Pressure from unions and employee relations committees can signifigantly impact on the day to day operations with strikes proving to be very costly to the company¶s image. y Updated versions of the fly on the wall documentaries would provide the brand with more coverage and publicity. especially Easyjet have allocated large sums of money for promotional offers and deals. According to The Observer newspaper. This would offer an extra perk and comfort to passengers making their experience with EasyJet all the more comfortable and enjoyable. y Offering of free refreshments on flights with a travel time of over two and a half hours. competition has become intense. fly to allocated places for £1. e. This type of ploy has been extremely successful in earning Easyjet a sizeable portion of market share. http://uk. SECTION 4 THE NATURE AND EXTENT OF COMPETITION IN THE MARKET Since the deregulation of European airlines in 1992. y Economic downturn may lead to a decrease in casual flyers and corporate travel as companies seek to curtail what they see as unnecessary expenditure and in turn make less business trips. This kind of offer has raised public awareness of the companies involved and has prompted similar competitive moves from the other low-cost operators.g. Easyjet has recently teamed up with The Telegraph newspaper offering extremely cheap deals in return for the collection of coupons.com/question/index?qid=20080225075844AAJAUmf fairness those who are not snobbish enough to reject the flights as inferior due to their low price. Threats: y Competitors flying the same routes compete very competitively on price forcing pressure on margin on more popular flights and time slots. The low-cost airlines. as frills are left out of their service.

Easyjet operates via a ticketless office. leaving the big names to fight it out for high-spending Business and First-Class passengers on long-haul routes. In August 2001 89% of Easyjet's tickets were sold online. * Original and very effective promotion strategies. * Diversification into other markets namely car rental and Internet cafes. PRODUCT * Low cost.UK air travel market .STRENGTHS * Charismatic leadership by Stelios. they are simply collected from the Easyjet desk at the airport. The ability to sell online decreases distribution costs. SWOT analysis can be used. * Allocate 10% of sales revenue used for promotion. As more air companies recognise the significance of being a budget airline. thus information can be cheaply stored on computer and administration costs can be reduced further. SECTION 5. Their ability to sell online and via the telephone makes travel agents redundant in their strategy. If they go on growing at the current rate. According to www. * Ability to cancel and change flight times. * Very good knowledge of the market and spontaneous effective responses to other companies attempts to .2. no tickets are sent out. * Good safety records * New aeroplanes that are clean and reliable. * Flights from secondary (less populated airports). SECTION 4. * Well known and respected brand name. which deserves more attention is Easyjet's ability to fly at such a low cost. * Use the sides of their planes as advertising banners. This again saves on time and costs. Easyjet can benefit greatly from their direct selling. PRICE * Very affordable prices (fly to Glasgow for the price of a pair of jeans) PLACE * Focus on Internet and telephone sales. As Easyjet fly's from secondary airports. Easyjet certainly operates within the overall cost leadership box.' This shows how well the budget airlines have done. they pay less in terms of airport fees and as these airports are far less congested. DIAGRAM 3 BROAD COMPETITIVE SCOPE NARROW The 4 P's can be used to show where Easyjet have sought to gain a competitive advantage. thus generating a sustainable long-term competitive advantage. however alongside these there are: .1 HOW COMPETITIVE ADVANTAGE IS SOUGHT Diagram 3 below shows the possible areas in which competitive advantage can be sought.justpeople. However the main area. the number of competitors in the low-cost market will rise. * Punctual flights. planes can be turned around quicker thus maximising revenue per plane. PROMOTION * Guerrilla tactics for promotional attacks on the airline industry and public relation stunts.23 million passengers a year . as it will allow them to build a close relationship with their customers. thus cutting out the middlemen.com. * Do not use travel agents.generating ticket sales of £1 billion. they will overtake the established airlines in the shorthaul market by 2020. SECTION 5 SWOT ANALYSIS OF EASYJET In order to measure how well Easyjet is currently doing and could be doing in the near future. * Motivated workforce. by obtaining a cost structure that is below that of many of their competitors within the industry. Related to this.1 INTERNAL ENVIRONMENT Many of Easyjet's strengths have already been listed in SECTION 4.

info/University/Business_and_Administrative_studies/Marketing/Easyjet_R eport_L90410.com. * Excellent customer service e. SECTION 5... WEAKNESSES * Flying solely within Europe.2 EXTERNAL ENVIRONMENT In order to avoid repetition.euromonitor. the share of total air travel to and from the UK accounted for by budget airlines is expected to increase to 9. revenues and profits have all been steadily increasing from 1999 to 2001 and look set to continue for the present future (see Appendix).target their customers.g.html .1% by 2003. * Customer numbers. * Reliance so much on computer for booking and for the storing of information could be risky due to failures and viruses. this report will use PEST analysis (as opposed to the opportunities and threats section . http://www.coursework. According to www. offering refunds for flights delayed 4 hours or more.