Sunday 20 October 2019

Strikes at rivals boost EasyJet earnings

EasyJet CEO Johan Lundgren. Photo: PA
EasyJet CEO Johan Lundgren. Photo: PA

Siddharth Philip

EasyJet said earnings for the year through September were toward the top end of its forecasts, helped by strikes at British Airways and Ryanair.

The unrest at EasyJet's biggest rivals spurred demand and sent revenue per seat, a proxy for fares, up 0.8pc in the second half, despite earlier predictions of a slide, the Luton-based carrier said.

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The figures were not enough to quell investor concerns that EasyJet had relied too much on disruption elsewhere, and that it faces tough times in an operating environment that has seen a spate of travel company collapses this year. The shares fell the most since May.

CEO Johan Lundgren said forward bookings for 2020 were in line with a year ago, and that capacity growth will be at the lower end of the historic range, something that should further bolster fares.

Efforts to curb delays in poor weather or technical glitches are also bearing fruit.

EasyJet said 12-month pre-tax profit was between £420m (€467m) and £430m, after earlier predicting £400m to £440m. The carrier reported a profit of £578m in fiscal 2019.

At least four carriers have failed in the past month alone amid fluctuating fuel prices, a glut of seats and a slowing European economy.

Slovenian flag carrier Adria Airways, and XL Airways and Aigle Azur, both of France, have folded, alongside Thomas Cook.

Bloomberg

Irish Independent

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