Angry Stelios nurses £1.5m loss as Fastjet shares crash

TYCOON Sir Stelios Haji-Ioannou was nursing a £1.5m loss yesterday after budget airline Fastjet issued its third profit warning in less than a year, sending its shares tumbling as much as 45pc.

The EasyJet founder ( pictured), who owns 12pc of the company, is in the middle of a bitter row with Fastjet management over its business model.

Last week, Haji-Ioannou called for the chief executive and founder Ed Winter to quit immediately, even though he is already stepping down later this year when a replacement is found.

The tycoon’s grievances will only have grown when Fastjet, which is listed in London but offers routes in Africa, told investors yesterday that earnings would be well ‘below market expectations’ and it would slump into the red. The shares ended the day down just over 36pc, or 24.25p, at 43p.

Haji-Ioannou believes Fastjet has a ‘ridiculously’ high cost base, particularly as many of the senior management are still based in the UK and regularly have to travel to Africa. The firm was set up to bring the low-cost model pioneered by EasyJet and Ryanair to Africa but has met some resistance from state-backed national carriers.

Operating from Tanzania and Zimbabwe it has been undercutting larger carriers and has struggled in the face of tough conditions.

Gerald Khoo, an analyst at broker Liberum, said the Tanzanian economy has stagnated for longer than expected following an election late last year.

He said: ‘We now forecast a £14m loss in 2016, compared with a £980,000 profit previously.’

Expansion into Zimbabwe has also caused Fastjet to issue two warnings on 2015 revenue and announce plans to axe routes and cut costs.

The firm said it can cover running costs, but did warn the ‘board monitors the cash position very carefully’.