EasyJet posts bumper profits but warns French traffic control strikes could blow it off course
EasyJet is making huge profits but warns that strikes by French air traffic control could blow it off course
Easyjet made huge profits as Britons went on holiday, but warned upcoming strikes could hurt performance.
The low-cost airline posted a record profit of £203 million for the three months to the end of June, compared to a loss of £114 million a year earlier. It carried 23.5 million passengers, up from 22 million in the same period of 2022.
The Luton-based company said it expected to generate “another record” in the current quarter ending September, despite canceling 1,700 flights last week as it tries to evade French traffic control strikes.
Johan Lundgren, CEO, also warned that the planned strikes at Gatwick airport add to the headache.
Although unions have partially suspended the action thanks to a new wage deal, hundreds of airport ground workers are still set to strike next week and into August.
Top flight: EasyJet posted a record £203m profit for the three months to the end of June, compared to a loss of £114m a year earlier
Sophie Lund-Yates, chief equity analyst at Hargreaves Lansdown, said: ‘Strikes in the industry can wreak havoc and the extent of this will not yet be known.
“The broader implications of major cancellations or changes will significantly erode earnings momentum if the issues persist.”
Airlines are also dealing with unusually warm weather in Europe, with temperatures approaching 50 degrees, although Lundgren said the extreme conditions are not yet impacting bookings.
‘Brits go to places like Egypt or Turkey for a long time in August, where the temperatures are consistently very high.
“So it doesn’t seem to be a deterrent at all for a lot of people. They are on vacation, sitting by a pool or swimming in the Mediterranean and have air-conditioned hotels,” said Easyjet’s chief.
The excellent results, which beat analysts’ expectations, were supported by skyrocketing ticket prices, which have risen 17 year-on-year. The average fare for a ride is now £73.
Lundgren said half of the average price increase of £11 per seat was due to fuel, with the gain largely driven by customers paying for extras such as seat selection and luggage.
Revenue for these add-ons was up 28 percent compared to last year, to £622 million.
Average revenue per seat rose to £90.49, up 22 per cent – and 36 per cent from pre-pandemic levels.
Total sales were up 34 per cent year-on-year to £2.4bn, with ‘good booking momentum’ well into winter. Shares fell 3.9 percent, or 19.3 pence, to 475.6 pence.