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EasyJet says it can survive a lengthy fleet grounding

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EasyJet planes parked at Luton Airport

EasyJet planes parked at Luton Airport

Bloomberg

EasyJet planes parked at Luton Airport

British low cost airline EasyJet said it would be able to survive a lengthy fleet grounding during the coronavirus pandemic due to the steps it had taken to shore up its finances.

The airline said that it had the ability to shrink its fleet through leases and planned to sell six old aircraft, giving it flexibility depending on the shape of future demand.

Looking to the future, it also said that bookings for winter are well ahead of the equivalent point last year.

Airlines across the world are battling to stay afloat at a time when lockdowns and travel bans have brought air travel to a near-halt and as deep uncertainty remains over the pace of an eventual recovery.

EasyJet said that given the level of continued uncertainty, it was not possible to provide financial guidance for the remainder of the full 2020 financial year.

"However, we continue to take every step necessary to reduce cost, conserve cash burn, enhance liquidity, protect the business and ensure it is best positioned for a return to flying," it said.

With its various funding initiatives, it expects to have generated total additional liquidity of around £1.85bn-£1.95bn (€2.1bn-€2.2bn), leading to a notional cash balance of about £3.3bn (€3.8bn).

EasyJet forecast a first half to March 31 headline loss before tax of £185m to £205m (€212m-€235m).

That would be an improvement on a loss of £275m (€316m) in the same period last year.

Reuters