EasyJet embroiled in dividends row

Stelios Haji-Ioannou has sparked a fresh row with the EasyJet airline he founded by demanding an increase dividend payments, it was reported today.

Haji-Ioannou, who with his family owns 38% of the company, sent a letter to chairman Mike Rake, which was seen by the Sunday Times and lists several demands including more than doubling its dividend to 50% of earnings.

The spat threatens to overshadow a bumper set of results on Tuesday, which are expected to reveal profits of between £240m and £250m in the year to September 30, compared to £188m last year. This would be a 27% increase at the low end.

The newspaper also reported that the British-Cypriot entrepreneur has accused the easyJet chairman of trying to turn his brother Polys Haji-Ioannou – another big shareholder – against him.

Haji-Ioannou has threatened to vote to oust directors unless they agree to his demands, the newspaper claimed. These include giving shareholders a vote on all new aircraft orders, pledging the next aircraft order will be a three-way tender between Boeing, Airbus and Bombardier, and publishing the profitability of each aircraft instead of profits per route.

The airline’s former boss, who stepped down from the board last year, has waged a long-running campaign against EasyJet’s expansion plans and called for cash to be returned to shareholders.

The company thought it had seen an end to the dispute after it promised £190m in dividends to investors, landing the airline’s founder and his family about £70m.

But hostilities flared up again when Haji-Ioannou recently wrote to the company to announce a rival called Fastjet.

EasyJet, run by chief executive Carolyn McCall is now one of Europe’s largest airlines, carrying 54 million passengers a year and employing 7,300 staff.