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Presentation to Universita’Roma3

Presentation to Universita’Roma3. Low Cost-Modello differenziato di Business 13 th of December 2010. easyJet Business Model. easyJet’s business model is centred on being: low cost, financially strong and highly efficient

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Presentation to Universita’Roma3

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  1. Presentation to Universita’Roma3 Low Cost-Modello differenziato di Business 13th of December 2010

  2. easyJet Business Model • easyJet’s business model is centred on being: low cost, financially strong and highly efficient • Building Europe’s number one air transport network – by establishing a dense point-to-point network serving Europe’s largest unique catchments through convenient airports • Providing a strong customer proposition and strong visible brand • Dynamic fares…if you book early, you pay less • Optional extras – pay only for what you need • Distribution - over 98% initial sales on-line • Operate a highly utilised fleet

  3. Europe’s best performing airline-Highlights 2010 • easyJet’s advantaged network and improved consumer demand has driven strong revenue performance • Total revenue per seat up 5.1% reported, +3.3% at constant currency • Seats flown grew by 6.0%, with a 15.9% increase in mainland Europe • Market share has grown from 6.5% to 7.6% over the last year • Underlying profit per seat grew by £2.53 to £3.36 • Fuel costs reduced by £2.19 per seat as higher priced hedges rolled off • Mix improvement offset the increased costs of disruption • Return on equity grew 3.1ppt to 8.6% • Continued strong cash generation, net cash flow from operations improved by £229m to £363m * Excludes interest income 3

  4. easyJet has strengthened 4

  5. Cost per seat - key drivers 5

  6. Delivering cost savings Additional £65m of cost reduction identified Delivers a net benefit to the bottom line of £1 per seat by end F’12

  7. Efficient fleet management 7 7 1 includes 4 aircraft held for sale (4 x A320) which will exit the fleet by 30.09.10

  8. Passenger Growth easyJet’s Growth • First flight operated on the 10th November 1995 between Luton and Glasgow • Average year on year growth of 15% 2006 -2008 • 20 bases across Europe inc. Rome (FCO) established in 2009 • Further mid-term growth 7.5% per annum - over 5 year • 48.8 M passengers transported in 2010 (+7,9%)

  9. easyJet’s phenomenal growth in Europe • easyJet has seen continued growth since start of operations in 1995 • easyJet is No3 in Italy, No2 in France and Spain and No1 in the UK

  10. Network- What we are interested in • Slots in primary, congested Airports, to attract good yields • Airfields is not our Business • Good catchment areas, with natural, healthy mix of outgoing and incoming passengers • Airports with different services for different Airlines models • Airports available to share investments principles • Airports which come up with ideas to promote, and not kill, high load factor • Less spreadsheets, more facts • Point to point- W patterns are operational and cost burdening

  11. Network – Connecting Convenient Airports • UK’s largest airline • Europe’s 4th largest airline • Accessible Network: • Over 300m inhabitants within one hours drive on an easyJet airport • Increasing diversity • Pan European Network – 53% of passengers originate from outside the UK • Third of flying does not touch the UK • Vital Network Statistics: • 29 countries • 20 bases • 123 airports • More than 500 routes • 196 aircraft • 48.8 million passengers

  12. Breadth and depth of network • Leading presence on Europe’s top 100 routes • Strong, defendable positions • London Gatwick No.1 • Milan Malpensa No.1 • Geneva No.1 • Paris No.2 • Berlin Schönefeld No.1

  13. Efficient fleet management 13 13

  14. 14 14

  15. 15 15

  16. easyJet growth in Fiumicino • Start of Operations in November 08 • Start of based operations in November 09 • Steady, Constant growth year on year

  17. easyJet in Ciampino • Decrease of traffic in favour of FCO started in 2009 • Process continues based on slots and infrastructures availability

  18. Differential pricing for LCC’s = Growth • Airports across Europe moving to ‘pay for use’ & ‘differential pricing’ – rewarding efficient use of Airports • Establishing a differential pricing structure should be easier and does not need to represent a downgraded quality of services • Low cost does not mean no seats and no shops • More efficient infrastructure usage allows for differential pricing (as per EU regs) e.g.: • Parking positions accessible by foot (walk in-walk out everywhere); no buses, no airbridges • Per usage charges; not per departing passenger

  19. The Key Economic Driver- “The passenger” Growth incentives to be encouraged at all airports, especially where infrastructure changes are not possible, to reward growth in overall traffic volumes A charging structure that favours efficient airlines; with lesser passenger weighted charges, delivers demonstrable and measurable benefits: Higher load factors and therefore more passengers driving commercial revenues for airport Lower environmental impact of air travel for passengers, through efficient use of aircraft

  20. …..we need each other to get the job done! Airports easyJet

  21. Thank you!

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