EasyJet predicts 14pc annual profit rise as flight ban to Tel Aviv extended
Published 24/07/2014 | 08:10
Low-cost airline easyJet said it would grow annual profit by at least 14pc assuming no further significant disruption over the next two months, putting it on track to meet analyst expectations.
The company forecast that pretax profits for the 12 months to the end of September would be in the range of 545 million pounds ($928 million) to 570 million pounds and the range included the impact from situations in Israel, Egypt and Moscow.
Analyst forecasts expect easyJet to report pretax profit of £569m for the current financial year according to Thomson Reuters data.
The airline's low fare model has helped it and low-cost rival Ryanair weather the impact of an increasingly competitive European shorthaul market, while higher cost carriers have struggled.
Air France-KLM, Europe's second-largest traditional network carrier warned earlier this month that its 2014 profit could be as much as 12pc lower than previously predicted, mainly due to overcapacity and resulting weak prices.
Lufthansa last month cut back its profit targets for the next two years, citing competition with low-cost rivals as one of the factors.
EasyJet was one of a number of airlines which on Wednesday suspended flights to Tel Aviv's Ben Gurion Airport after it was targeted by Palestinian rockets. Flights were also suspended on Thursday and the airline said it was reviewing its operations in the country on a day by day basis.
Calling its third quarter performance solid, easyJet said it grew revenue by 8.6pc to £1.2bn in the period, having added capacity of 6.8pc.
It said cost per seat, excluding fuel and currency movements, was 1.3pc lower than the year earlier period, beating earlier guidance of a 2pc rise for the second half of the year.
Shares in easyJet, which have fallen 17pc over the last three months, closed at 1,403 pence on Wednesday.