EasyJet charts strong recovery despite ‘pre-emptive’ flight cancellations

EasyJet today admitted making “pre-emptive” flight cancellations as it revealed a trimming of winter half year losses.

The UK budget carrier flew 94% of its planned schedule in the last seven days with around 1,500 daily flights – a level four times higher than the same point last year.

The expanded flying programme is being run despite a recent increase in the number of crew testing positive for Covid-19, together with normal operational disruption such as weather and air traffic control delays, according to the airline.

“We have proactively managed this in advance by making pre-emptive cancellations as early as possible, enabling the majority of our customers to rebook onto flights departing the same day,” easyJet added.

The airline expects to report a group pre-tax loss between £535 million and £565 million for the six months ended 31 March 31.

EasyJet said in a trading update: “First half losses have reduced year-on-year, outperforming expectations, as self-help measures including network optimisation, ancillary products, and a continued cost focus deliver.

“This result is despite ongoing challenges from Covid-19, rising fuel prices, the removal of furlough support and incremental costs associated with ramping up operations.”

Capacity for the current three months is expected to be at 90% of pre-pandemic 2019 levels with peak summer quarter capacity on sale remaining at near 2019 volumes.

Summer bookings in the last six weeks have “tracked ahead” of the same period in 2019 as customers book closer to departure.

“We continue to see strong demand for Q4, especially on leisure routes where easyJet will be the biggest it has ever been,” the carrier said.

“This has been boosted by the addition of a further five aircraft worth of slots in Greece. EasyJet will be the largest carrier into the main Greek islands this summer.”

Tour operating arm easyJet holidays also continues to strengthen its position as a “significant player” in the market, with more than 70% of its programme already sold and at “significantly stronger” margins compared to 2019.

The airline reported a “strong and sustained recovery” since the removal of UK travel restrictions on January 24, resulting in the proportion of bookings between the UK and EU now being broadly equal compared to last year when the split reached around 70:30 EU verses UK with the strictest restrictions in place within the UK.

Passenger numbers grew to 11.5 million in the quarter to March against just 1.2 million in the same period last year with an overall load factor of 78%.

EasyJet has “very little exposure” in eastern Europe, with no routes into Ukraine, Russia or Belarus.

The nearest network points are Budapest in Hungary and Krakow in Poland which only account for 1.4% of total capacity.

“Additionally, due to our geographical footprint, none of our flight routes need to operate into Ukrainian, Belarusian or Russian airspace, and therefore we are not exposed to re-routing and increased fuel burn,” the airline added.

Sale and leaseback deals for 10 Airbus A319s has generated total gross cash proceeds of $120 million and a loss of £20 million during the six months to March 31.

“EasyJet entered into these transactions as part of the ongoing strategy to manage residual value risk,” the carrier said.

Chief executive Johan Lundgren said: “EasyJet’s performance in the second quarter has been driven by improved trading following the UK government’s decision to relax testing restrictions with an extra boost from self-help measures which saw us outperform market expectations.

“Since travel restrictions were removed, easyJet has seen a strong recovery in trading which has been sustained, resulting in a positive outlook for Easter and beyond, with daily booking volumes for summer currently tracking ahead of those at the same time in FY19.

“We remain confident in our plans which will see us reaching near 2019 flying levels for this summer and emerge as one of the winners in the recovery.”

Source – travel weekly

Leave a Reply

Your email address will not be published.

error: Content is protected !!