EasyJet defers delivery of 24 Airbus jets to preserve cash

Bloomberg

EasyJet Plc deferred the delivery of 24 Airbus SE A320-family jets that were due to arrive over the next three years as the carrier moves to protect cash amid the coronavirus pandemic.
The handovers will be postponed to an undetermined date, the British low-cost airline said in a statement. The moves will significantly reduce the low-cost airline’s capital expenses over the next three years, it said, promising to provide further details with a trading update on April 16.
EasyJet has come under intense pressure from its founder and largest shareholder, Stelios Haji-Ioannou, to cancel the entire Airbus order for more than 100 aircraft, valued at 4.5 billion pounds ($5.6 billion). The airline has instead sought to postpone deliveries, avoiding a direct conflict with the planemaker over contracts that are hard to break, and preserving its ability to resume growth once the coronavirus crisis breaks.
It’s also borrowed $1.35 billion to shore up liquidity, tapping into a UK guarantee program that Haji-Ioannou also opposes.
“A deferral is the same as kicking the can down the road,” Haji-Ioannou said in a statement. The airline isn’t telling investors how much it will pay for Airbus aircraft over the next six months, including with UK taxpayer money, he said.
EasyJet declined to comment on Haji-Ioannou’s statement. He has proposed shareholder meetings to oust Chief Financial Officer Andrew Findlay and another board member, actions that the airline has called a distraction. Among the moves, EasyJet will push back receipt of 10 planes that were due to be delivered by the end of its fiscal year in September, though it didn’t say how many planes it will accept.