Investors should hang on for McCall

SUCH a public attack on a departing chief executive as that made by Sir Stelios Haji-Ioannou on Andy Harrison’s five years at the helm of easyJet is almost unheard of.

Calling Harrison “overrated” and saying he had increased “nothing but the size of his bonus”, Stelios’ attack was harsh, but he has a point.

Investors’ key concern is when Harrison’s focus on growth will deliver. In the five years since he joined the budget airline, Harrison has increased the number of aircraft by 75 per cent to 189 airplanes. Another 88 airplanes, worth $4bn, are on order. The airline has been growing at 15 per cent a year, but the share price has barely budged. Growth is all well and good, but you can’t expect investors to wait forever.

Stelios wants the airline to increase its profit margins and start to reward investors with that elusive dividend. Afterall, easyJet has a healthy £1.4bn sitting on the balance sheet. With ex-Guardian Media Group chief executive Carolyn McCall arriving in June Stelios will finally be able to reduce growth to zero. And its results, which while hit by the volcanic ash cloud, were overwise solid with narrower-than expected pre-tax losses of £78.7m, could finally start to sparkle.