EasyJet cashes in as families shrug off cost-of-living crisis to fuel explosion in summer holiday bookings
Families are scrambling to book summer holidays despite the cost-of-living crisis, EasyJet said.
The low-cost airline said a strong increase in demand and full-year profits would beat expectations of £260 million.
EasyJet’s optimism in yesterday’s trade update was fueled by signs that families are ready to go on summer vacations regardless of higher fares.
Chief executive Johan Lundgren said the ‘usual suspects’ of Mallorca, Malaga, Alicante and Amsterdam are among the most popular destinations.
Booking boom: Budget airline Easyjet said strong increase in demand and full-year profits would surpass expectations of £260m
EasyJet’s average fare for the summer is around £90, significantly higher than the £61 in the six months to the end of March.
Lundgren said rampant fuel inflation — up 71 percent year-on-year — was to blame for the rise in ticket prices.
He emphasized that the more expensive rates are “still within reach for many people,” adding: “Despite the rise in the cost of living, holiday budgets remain unchanged, with travel being the only discretionary expenditure that people are willing to maintain or to increase.
“This underlines the importance of travel for consumers.”
The prospect of a peak summer comes after a strong Easter for EasyJet, when capacity returned to pre-pandemic levels thanks to an average of 1,600 flights per day.
Despite an 80 per cent rise in first-half revenues to £2.7bn, the airline still suffered a loss of £415m – although this was better than its £545m loss in the same period a year earlier.
And EasyJet said it ‘anticipates to exceed current market profit expectations of £260m’ for the full year.
Passenger numbers between January and March were more than 35 percent higher than the same period last year, as more than 15 million travelers flew with the company during that period.
Lundgren said capacity will be about 8 percent above pre-pandemic levels by the summer.
EasyJet has recently embarked on its largest-ever recruitment drive to meet growing demand, employing around 3,000 people in the past year.
This latest wave of optimism will provide much-needed relief to the travel industry after huge numbers of queues and cancellations at airports last summer.
Shares added 1.6 percent or 8.2 pence to 519.2 pence.