Winter profit offers boost for easyJet

UK capacity grew by three per cent over the half year as 12 new routes came on stream
UK capacity grew by three per cent over the half year as 12 new routes came on stream

Budget carrier easyJet turned in its first half-year profit in more than a decade as it flew more passengers and enjoyed a strong finish to the ski season.

The group swung to a £7 million pre-tax profit in the six months to March 31, from a £53m loss a year ago, as it flew 28.9 million passengers, a 3.8 per cent rise on the period.

It had recently forecast it would make somewhere between a loss of £5m and profit of £10m in the winter period when airlines traditionally report a shortfall.

The last time the airline was in the black in its winter season was in 2002, when it posted a £1m profit.

The airline said its cost per seat fell 1.4 per cent to £38.66, due to a decline in oil prices and helped by strong October trading and the timing of Easter.

The firm’s load factor - a key industry measure which indicates how full its planes are - improved 0.7 per cent to 89.7 per cent against the same period a year ago.

EasyJet, which has a fleet of 230 planes, said that because of lower oil prices it expects its fuel bill to be between £95-120m lower than last year.

But it added that the strong pound has cost it around £40m during the period, and expects it to cost the airline around £20m over the full year.

The carrier added that it suffered more than 600 cancellations last month, the majority of which were caused by French air traffic control strikes.

It said this disruption would affect its full-year profit by around £25m.

In the UK easyJet, which operates from its base at Belfast Internatoinal Airport, boosted its capacity by 20 per cent at London Gatwick after buying take-off and landing slots from rival Flybe and using larger aircraft at the airport.

It grew its UK capacity by three per cent in the period and launched 12 new routes, including Edinburgh to Funchal and Gatwick to Stuttgart.

The airline said it would grow its overall network capacity by a further 6.2 per cent in the summer, and expected to offer its customers even better-value fares this summer while continuing to grow revenue and profit.

Chief executive Carolyn McCall said the carrier delivered a “record performance” in the first half of the year.

She said: “As we enter the important summer season, forward bookings are in line with last year and, as we predicted, passengers are benefiting as fares fall to reflect a more competitive operating environment and lower fuel costs.”

Brokers expect easyJet to turn in a annual pre-tax profit up around 17 per cent to £680m.

Shares dropped eight per cent in a depressed market.