Easyjet optimistic about profit against competitors' strikes

Easyjet optimistic about profit against competitors' strikes

Tuesday, 08.10.2019

EasyJet's performance continued to meet expectations despite challenging market conditions (Keystone)

The British airline EasyJet showed Tuesday slightly more optimistic about its annual profit before tax after taking advantage this summer strikes affecting its competitors.

The low-cost carrier expects this profit will be between 420 and 430 million pounds (470 to 481 million euros) for the accounting year from October 1, 2018 to September 30, 2019, according to a statement.

This result will be at the high end of the range reported by the group in July, which was between 400 and 440 million pounds.

EasyJet, however, reported a sharp decline in pre-tax profit of around 25%, as it had reached £ 578 million in the prior year.

The group, like the European airline industry as a whole, suffers from fierce competition between companies, driving prices down and squeezing margins, not to mention rising fuel costs.

In addition, the economic context is sluggish with a slowdown in growth on the continent, as well as in the UK where the uncertainties of Brexit weigh on activity.

EasyJet, however, says it has had a better summer than expected thanks to strong demand, which it attributes to the strikes suffered by its competitors, namely British Airways and Ryanair.

He also said that he took advantage of initiatives to be more efficient and increase his revenue.

The group now expects its total revenue per head office, an indicator scrutinized by the market, to increase by around 0.8% in the second half of the year, whereas it had previously forecast a slight decline.

For the year as a whole, this indicator should nevertheless decrease by 2.7%, says EasyJet, whose passenger load over the year increased by 8.6% to 96 million.

The average fill rate of its aircraft will drop by 1.4 percentage points to 91.5%.

"EasyJet's performance continued to meet expectations despite challenging market conditions," said Johan Lundgren, group CEO.
EasyJet will unveil its full annual results on November 19 and will take the opportunity to provide details on its priorities for the 2019-2020 fiscal year.

Finally, the group did not mention in its release the bankruptcy of the British tour operator Thomas Cook, with whom he was competing on many destinations.

Lundgren told the German press last week that he would look into whether Thomas Cook's assets could be attractive to EasyJet, without having yet made a decision. (Awp)