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Easyjet forecasts reduced loss in first half and strong recovery in bookings

The company forecasts a pre-tax loss of between £535 million and £565 million for the six months to the end of March.

Low-cost carrier Easyjet anticipates a reduction in its year-on-year loss for the first half, and welcomes a strong recovery in bookings which should return to pre-pandemic levels this summer.

The carrier “low costforecasts a pre-tax loss of between £535m and £565m for the six months to the end of March, down from the same period in 2021 when the loss was £690m to £730m. Easyjet attributes this improvement to managing its costs as closely as possible, the increase in ancillary revenues, and a “network optimization“, According to a press release Tuesday. The period under review suffered from the Omicron wave of coronavirus which again weighed on international travel around the key Christmas holiday period, but since the start of 2022 many countries, including the UK, have eased considerably or even eliminated all health restrictions, allowing traffic to restart.

“Persistent” difficulties

Easyjet still regrets, however, “the persistent difficulties linked to Covid-19, the rise in kerosene prices, the end of government aid for employment“put in place at the start of the pandemic,”and the costs arising from the increase in capacityto cope with the demand for travel which is picking up again. The British company emphasizes having increased its transport capacities throughout the second quarter of its staggered financial year, “operating in March at 80% of 2019 capacity“. Since the lifting of travel restrictions, says Easyjet, “we have seen a strong and sustained recovery» reservations, with those for the summer exceeding the level of 2019.

The carrier says it has “very little exposure to Eastern Europeand therefore to the fallout from the war in Ukraine. “The closest points of our network (to the conflict) are Budapest in Hungary, Krakow in Poland, which account for only 1.4% of our total capacity»Transport. «We are confident that our plans will allow us to return close to our 2019 flight levels this summer and emerge as one of the winners of the recovery.post-Covid, commented Johan Lundgren, managing director of EasyJet, quoted in the press release. During a telephone press conference, Johan Lundgren assured that despite a jump in Covid-19 cases among company employees which has led to several hundred flight cancellations in recent days, he is not worried about disturbances for the summer period. He said he wantedput into context» cancellations which represent only a small part of the flights operated by Easyjet.

When asked whether Easyjet had sold flights that it could not provide, the boss of the company defended himself, arguing that the level of absence of crews was “doublefrom normal and sometimes reached 20%. Asked about the soaring prices of kerosene, Johan Lundgren assured that the company was “properly coveredagainst price fluctuations. British Airways has also had to cancel flights due to absent employees due to Covid in recent weeks. Easyjet shares fell 1.62% to 533.80 pence around 0845 GMT.

«2022 was the supposed year of recovery for airlines like Easyjet, which were devastated during the pandemic when most planes were groundednotes Victoria Scholar, an analyst at Interactive Investor. “But the sector faces new difficulties with the war in Ukraine, rising oil prices, a sharp jump in UK Covid cases which affects sick employees and journeys to the UK“, she adds.

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