easyJet on the non-pre-emption trail

With the additional funding already raised, the group will have a cash balance of around £2.85bn after the placing, enough to see it through to the end of the year if the fleet was grounded again – a limited domestic service is now in operation.

The placing represents approximately 15 per cent of the budget carrier’s existing share capital. A third of the placing shares are subject to shareholder approval, which could be problematic given the ongoing spat with its founder and principal shareholder Sir Stelios Haji-Ioannou, particularly given that it is being conducted on a non-pre-emptive basis.

News of the placing accompanied half-year figures detailing a 7.4 per cent fall in passenger numbers as the effects of the outbreak were already in evidence by the end of March.

Capacity fell by a similar margin due to widespread flight cancellations, which had a deleterious effect on costs on a per seat basis. The income statement also bore the brunt of the cancellations through a £164m charge on over-hedging covering routine fluctuations in jet fuel and foreign exchange. Management has taken action to mitigate any hedging issues going forward.

† A total of 59.5m shares have subsequently been placed at a price of 703p per share, of which 19.9m shares will be issued conditional on shareholder approval.