EasyJet underlying profits fell 35% in the year to 30th September, despite rising passenger numbers and revenue. Higher fuel prices were blamed for the fall in underlying profits to £123m.

Reported profits also dropped from £202m last year to £110m this year.

Founder and major shareholder Stelios Haji-Ioannou refused to sign off the company annual accounts. In a statement attached to the results, he said: “I am concerned about the application of certain of the accounting policies adopted by the board in a way that I believe is at odds with current commercial realities and the macro-economic climate.”

He is trying to get two non-executives of his choice appointed to EasyJet’s board. He also wants the company to focus on cash flows forecasts rather than carrying more passengers and to plan to pay a dividend by 2011.

The low cost airline pushed through cost savings and efficiencies that helped raise revenues by 31.5% to £2.363bn.

Revenue per seat also rose 12.6% for the full year and 15.2% for the second half, driven by improved ancillary revenue performance.

Andy Harrison, easyJet Chief Executive said: "Our winter bookings for the first quarter of 2009 are slightly ahead of last year, which is partly a reflection of the reduction in competitive capacity on our routes and partly our own decision to restrict our growth in seats flown. There is also evidence of a ‘flight to value’ for both business and leisure passengers.”

He said the company will continue to drive down controllable costs and preserve cash.

EasyJet’s fleet now numbers 165 aircraft, including 16 included in the acquisition of GB Airways.

It is deferring the purchase of four Airbus aircraft scheduled for delivery in 2010, in light of the slow sale of surplus aircraft and the likelihood of a prolonged recession.

At 8.30am, easyJet's share price was down 10.75 pence to 265.75 pence.

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