About the only clear detail was that Bellew resigned on Friday. Given that Monday morning at 7am sharp would have been the normal time to update shareholders, the other slight mystery is why it took easyJet until 11.30am to do so. The corporate commitment to direct communication takes work. Bellew was hired by Ryanair amid much fanfare just two and a half years ago, so you can see why the stock market lost another 4% in easyJet’s share price. An old branch was thought to be just the type of executive to restore order to operations after recent upheavals. Instead, David Morgan, the flight director, will “seamlessly transition” into the role, said Johan Lundgren, chief executive. If a personnel change makes the network run more smoothly this summer, no one – least of all the players – will complain. An open question, however, is whether the change is also an admission by easyJet that not all of its woes can be blamed on Gatwick Airport, air traffic controllers, workforce shortages and general manager woes. Operating conditions are tough – no doubt about it. But Lundgren’s boast in May about how much easyJet had “transformed” during the pandemic and gained “renewed strength” was also seen as too premature in light of the facts. The other interesting question is the role behind the scenes of Stephen Hester, chairman since last December. Hester – formerly of Royal Bank of Scotland and RSA Insurance Group – is a boardroom operator of the unemotional old school. Lundgren will know that the buck ultimately stops at the CEO’s door.
The possible need to draw cash is a question that the AO is yet to answer
However, easyJet beats the early bullish shares of AO World, an online retailer of fridges, freezers, laptops and the like. “I think we’ve seen 10 years of change in 10 months,” founder and CEO John Roberts said in January 2021, after lockdown conditions had put a rocket in demand. It was a mirage. Sales reversed when Covid restrictions eased and AO last month said it would abandon its seven-year run in Germany and remain in the UK. Now comes a reminder of how horizons have also shrunk at home: a story of a credit insurer reducing coverage. The cover in question is the protection purchased by suppliers against the risk of ruining a retailer. The AO essentially confirmed the Sunday Times report that Atradius, one of the specialist firms in the market, had reduced its exposure, but the accompanying reassuring explanation did not have the desired effect. Shares lost 18%. The cap was “reset” in May, the AO said, “from the increased levels that existed and were required during the pandemic.” So was Atradius just doing some normal housekeeping? Or do suppliers have to pay more, per cooler, to get the same protection? It wasn’t entirely clear. The AO was more convincing in its efforts to protect its balance sheet. The cost of the German exit will be at the “lower end” of the initial estimate of nil to £15m. An £80m credit facility is in place until April 2024. Nothing has changed on the trading front since the last update in April and the rebased coverage “has had no impact on AO’s liquidity position”. Okay, all these points are relevant. But they do not put to bed some questions from City analysts about the potential need to pump cash to adjust to new trading conditions. After the share price’s descent from 400p to 56p in 18 months, it’s a natural question. Subscribe to the Business Today daily email or follow Guardian Business on Twitter @BusinessDesk
Just Eat holidays may leave investors scratching their heads
The party continues at Just Eat Takeaway, the Dutch food delivery company that was a member of the FTSE 100 index. The highlight of the winter was a staff skiing trip to Switzerland that was rumored to have cost $16m (£13m). Now, via Bloomberg, comes news from the company’s German operation, Lieferando, of an “exclusive pool party” where the invitations specified that “drivers and emergency workers” were to be excluded. All necessary to build head office morale, no doubt, but investors may be wondering what they’re supposed to be celebrating: the share price is down 67% this year.
