Easyjet is expected to report strong growth in unveiling its annual profits topping £580 million.
The largest carrier in terms of passenger numbers to operate out of Liverpool John Lennon Airport, Easyjet flies to more than 30 locations. The company recently upgraded its pre-tax profit guidance for the last year, estimating profits between £575 and £580 million – a potential increase of up to 21% on last year’s profits.
The latest upward revision for Easyjet, who have diversified their consumer base to encourage corporate fliers, as well as their core base of leisure fliers, shows a strong performing strategy compared with other major carriers from across Europe, with AirFrance-KLM and Lufthansa both providing profit warnings owing to rising competition on their routes.
Meanwhile, short-haul airline operators have enjoyed better results, with Easyjet rival Ryanair also upgrading its full year profits guidance by 18%, and regional carrier Flybe also achieving a 9% rise in passenger revenues per seat over the last six months.
Easyjet capitalised on a recent two-week strik by Air France pilots to take an extra £5 million in sales as consumers switched airlines out of convience.
Despite Easyjet expecting capacity growth in the last two quarters of the year to drop from 6.4% to 6.3%, the airline forecasts a rise in revenues per seat from 1% to 2% over the same period.
Passenger numbers for the month of September increased 7.5% from last year’s figures, bring the total to 6.14%.
Easyjet also added that more than 25% of seats for the first two quarters of the next financial year have already been sold, a slight increase on last year’s pre-sale figures.
Ryanair still present stiff competition, who claim that their average fares will fall by between 3% – in this quarter before the seasonal promotional fare drive reduces fares by 6% – 10% in the New Year.
Analysts as Credit Suisse said:
“EasyJet has proved itself in a testing 2014 and would seem well equipped to continue demonstrating commercial momentum as capacity headwinds ease.”
Words: Peter Cribley