Article date: 02 June 2016
easyGroup notes that today Fastjet has finally released its financial results for the year ended 31 December 2015.
As we noted in our notice of 27 May 2016 to convene a general meeting to remove Colin Child as an Executive Officer and Director of fastjet PLC with immediate effect, he has still failed to achieve two critically important tasks in his specific mandate: replace the CEO and move the head office from Gatwick to Tanzania
Todays' announcement from Fastjet reconfirms that he has not achieved these objectives. Child states that the "Search for new Chief Executive Officer [is] well advanced" but after such a prolonged period, easyGroup no longer has any faith in Colin Child's ability to appoint a new CEO in the near future. The low cash position makes this crucially important.
In relation to the cost cutting, he press announcement contained no commentary whatsoever of the move of the head office to Africa, implying a continuation of an expensive cost base with its expensive consultants. We have already stated that someone should be appointed as interim CEO in Dar es Salaam, the centre of the airline's operations and customers.
easyGroup is also sceptical of the stated reasons for such poor results, including a weakening of the Tanzanian economy. The World Bank presently gives the estimated 2015 growth for Tanzania as 7.2% and forecasts a further 7.2% for 2016. Hardly a slowdown in the economy.
We also note that no load factors are given for current trading since the year end. Given the importance of such figures in evaluating the company and the generally accepted publication by quoted airlines, we continue to demand that such figures be published.
The combination of a qualified audit report together with the paradoxical statements that Fastjet is a going concern yet expects further funding means that drastic action need to be done rapidly before the company runs out of money.
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