EasyJet says it expects annual profits to be at the upper half of its guided range, helped by strike “disruption” among rivals.
In a trading update covering the fourth quarter of its financial year, the no-frills carrier said it benefited from industrial unrest at both British Airways and Ryanair.
But it said a focus on costs had helped shield it from other headwinds such as higher fuel prices while adverse foreign exchange rates would result in a £14m hit in the year to September.
EasyJet said customer demand had proved “robust” despite Brexit uncertainty and a slowdown in the global economy being blamed for contributing to turbulence in the wider industry.
Thomas Cook collapsed in the final week of its 2019 financial year and the airline told Sky News it was too early to say whether it was experiencing a boost in demand from the tour operator’s demise.
However, it expected to see some benefit as its current financial year continued towards next summer. It said forward bookings for the first quarter were flat on the same period a year ago.
The company reported an 8.6% increase in passenger numbers for the year to September – hitting 96 million, driven by an increase in capacity. Its planes were not as full as in the previous 12 months – falling by 1.4 percentage points to 91.5%.
It said its “operational resilience initiative”, which aims to minimise disruption through a series of measures including improved employee engagement, was a driving force behind its profit guidance.
Johan Lundgren, easyJet chief executive said: “easyJet has continued to perform in line with expectations, despite challenging market conditions.
“As a result of our self-help initiatives and the increased demand due to disruption at British Airways and Ryanair, we anticipate achieving headline profit before tax for the full year 2019 of between £420m and £430m., in the upper half of our previous guidance range.
“Our implementation of initiatives in the fourth quarter to optimise yield has led to solid revenue performance with total revenue per seat at constant currency set to increase for the full year.
“We have continued to invest in operational resilience, with the programme successfully reducing the impact of disruption on our operations. As a result, we expect to report a fall in headline cost per seat for the year, excluding fuel at constant currency.”
The profit guidance means easyJet expects to see a fall, of at least 25%, on the earnings achieved in 2018.
EasyJet shares, down 6% in the year to date, fell by more than 3% at the market open.