EasyJet says holiday bookings will rebound despite terrorist attacks
EasyJet predicted that European demand for air travel will rebound after dropping in the wake of the terror attacks that pushed it to a first-half loss, and said its cash position is strong.
Fares that are under pressure from overcapacity after the outrages in Brussels, Paris and Sinai should recover from July through September, the strongest quarter for European airlines, Luton, England-based EasyJet said yesterday.
EasyJet halted Sinai flights after the downing of a Russian tourist jet in October, while November's Paris shootings and the March 22 bombings in Brussels further weighed on sales. The carrier swung to a £24m (€30m) pretax loss in its first half through March from a £7m pound profit, and said third-quarter revenue per seat may decline 7pc.
"You can't expect those kinds of external events not to have an impact on your trading and your numbers," chief executive officer Carolyn McCall said.
"Despite all of that we are saying that we are comfortable with the current consensus."
Summer demand for flights to Mediterranean destinations is encouraging, with an "improving trajectory" for bookings in May and June, she said.
EasyJet shares rose as much as 3.9pc and were trading 2.2pc higher at 1,503 pence in the wake of the results. That pares their decline this year to 13.7pc, valuing the company at £5.96bn. "The volumes are there now, what isn't the same as last year is the pricing," McCall said on Bloomberg TV. "We've seen that post- every big event that has happened. It takes a little bit of time and then people start flying again."
A "more competitive trading environment" is set to continue for the medium term as fuel prices remain low, she said. EasyJet faces heightened competition as Ryanair targets more major airports, as well as from an expansion of IAG's Vueling arm and makeovers at the budget units of Deutsche Lufthansa and Air France-KLM.
Ryanair's earnings for the year ended March 31 are due to be released on May 23. (Reuters)