Budget airline easyJet has announced that chief executive Johan Lundgren will leave the business, spooking investors and sending the airline’s shares sharply lower.
At 496.7p per share, easyJet’s share price slumped more than 6% on the news, making it the FTSE 100’s second-biggest faller in Thursday trading.
Lundgren — whose six-year tenure will end next May — will be replaced by chief executive Kenton Jarvis.
Both men had previously held positions at industry rival TUI.
Chairperson Stephen Hester said “we are sad that Johan will retire from easyJet. He has done an excellent job as our CEO since December 2017; steering the company through the immense challenges of the COVID period, and setting up a clear strategy and strong execution plan towards its ambition of ‘being Europe’s most loved airline, winning for customers, shareholders and our people.’”
He noted that “we are also delighted to be able to announce Kenton as our next CEO, allowing an orderly and seamless transition,” and added that “we are focused on executing the medium term plan and related financial targets set out earlier this year and see Kenton as the ideal person to lead our executive team to that end.”
More Solid Numbers
The Luton-based airline released another upbeat set of half-year trading numbers alongside its CEO announcement.
The low-cost specialist saw sales jump 22% between October and March, to £3.3 billion. easyJet said that this was chiefly thanks to “an increased flown capacity, pricing strength and ancillary products including easyJet holidays continuing to deliver incremental revenue.”
Passenger revenues improved 17% year on year, to £2 billion, while traveller numbers advanced 11% to 36.7 million. The load factor increased 12% to 42.3 million seats.
The airline said that ancillary revenues leapt 30% from the same 2023 period, to £1.2 billion, “as capacity increased and as easyJet holidays continues its rapid growth.”
Profits at easyJet holidays grew profits 210% in the first half as customer numbers rose 42%. The package holiday division now accounts for 10% of group turnover.
This helped the business trim pre-tax losses to £350 million, a year-on-year reduction of £61 million.
On Track
Lundgren said that “easyJet’s targeted growth and focus on productivity has delivered a reduction in winter losses, boosted by our trusted brand and network that we continue to invest in.”
He added that “we are now absolutely focused on another record summer which is expected to deliver strong [full year] earnings growth and are on track to achieve our medium term targets.”
The company said it remains on course to deliver annual pre-tax profit north of £1 billion.
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