- Full-year profits to beat market expectations
- EasyJet holidays currently 80% sold for summer 2023
- Fuel costs worry
Budget airline EasyJet (EZJ) said it expects full year pre-tax profits to beat market expectations which sit at £260 million due to strong demand for bookings throughout the year.
EasyJet holidays are currently 80% sold for summer 2023.
Shares in the budget airline were up over 1% at 517p adding to gains of 54% over the last year spurred-on by continued recovery from the pandemic.
Johan Lundgren, CEO of EasyJet, said: ‘Demand for EasyJet’s flights and holidays has continued to grow in the half, resulting in more than a £120 million pound improvement in our performance as well as a billion-pound revenue improvement year on year. This is further enhanced by our transformed network of popular destinations and improved revenue capability.
‘We see continued strong booking momentum into summer as customers prioritise spending on travel and choose airlines like EasyJet offering the best value and destination mix, as well as EasyJet holidays which is continuing its steep growth trajectory as the fastest growing holidays company in the UK.’
HOW DID THE COMPANY PERFORM?
The positive full-year forecast came as EasyJet reported an 80% rise in group revenue to £2.7 billion for the six months ending 31 March 2023 compared to £1.5 billion in the same period last year.
EasyJet said Easter demand had been strong in the first half of 2023 with around 1,600 flights operating on average per day.
Notable highlights included the UK, with capacity ‘back around pre-pandemic levels.’
EasyJet holidays also continued to benefit from strong UK demand, and the budget airline is further upgrading its growth expectations to circa 60% year-on-year from 50% previously.
FUEL COSTS WORRY
Russ Mould investment director at AJ Bell said: ‘A lot of things are going right for EasyJet following a long period of patiently waiting for the airline industry to recover from the pandemic.
‘It is flying more passengers, ticket prices are higher, growth for its package holidays arm is better than expected, and it has lifted full-year profit guidance. However, it is still fighting higher fuel and operating costs and the return of air traffic control strikes.
‘The big unknown is demand for last-minute breaks. While advance bookings have been encouraging, the more plane tickets go up in value, the more certain people will be priced out of taking a foreign holiday.’
DISCLAIMER: Financial services company AJ Bell referenced in this article owns Shares magazine. The editor of this article (Martin Gamble) owns shares in AJ Bell.
