Business & Investment

Travel curbs and blockades send even higher losses on EasyJet

EasyJet losses accelerate in travel restraint and blockade, but low-cost carriers are confident of recovery

  • Pre-tax airline headline losses increased by approximately £ 300 million to £ 1.14 billion
  • Confused and constantly changing travel rules have reduced the demand for flights
  • EasyJet expects to fly at about 65% of 2019 level capacity in the first quarter


EasyJet recorded a much larger annual loss following a year full of nasty travel bans and national blockades across Europe.

Low-cost carrier pre-tax headline losses increased by approximately £ 300m to £ 1.14bn in the year to September 30 as passenger numbers and revenues plummeted by more than half.

Not only did the temporary ban on overseas travel across Europe prevent people from flying for many hours, but the confusing and constantly changing travel rules also helped many British people avoid booking flights. Instead, I decided to take a domestic holiday.

Trouble: Low-cost carrier pre-tax headline losses increased by about £ 300 million over the year to September 30 as passenger numbers and revenue plummeted by more than half.

Demand has begun to recover significantly since deregulation in the summer, and the company says bookings for the half-October period, skiing and Christmas were strong.

We expect to fly at about 65% of the 2019 level capacity in the first quarter, then 70% in the next three months, and recover capacity to pre-pandemic levels in the final quarter.

This admits that despite concerns over the spread of the Omicron variant, transactions with many customers who forward reservations at a later date have been delayed.

Starting today, all international travelers arriving in the UK must undergo a PCR test within 2 days of arrival and self-quarantine until a negative test. Ten African countries have also been added to the Travel Red List.

EasyJet’s share price was hit hard by a plunge in London-listed airlines after Prime Minister Boris Johnson announced the latest travel restrictions at a press conference in Downing Street last Friday.

EasyJet states: But we are prepared for such uncertain times. “

Since the beginning of the coronavirus crisis, airlines have raised about £ 6 billion. This includes £ 1.2 billion by investor rights issue in late September to help reduce debt and support new investments.

Last year, we reduced the number of full-time crew members except one of our locations, renegotiated contracts to minimize redundancy costs, and reduced base salaries in some high-cost countries, adding another 500 million. Saved pounds.

In addition, by reducing publicly funded support measures such as the UK government’s temporary dismissal system less frequently and reducing jet fuel spending by £ 350 million, the Group will reduce its total heading cost by £ 1.25 billion. Reduced.

Chief Executive Officer Johan Lundgren said:[EasyJet] Is transforming its business by overcoming pandemics with new power, optimizing its network and flexibility, delivering significant cost savings while gradually changing its ancillary revenues.

Rebound: Sophie Lund-Yates of Hargreaves Lansdown said EasyJet is a short-haul service, so demand should recover faster than long-haul airlines.

Rebound: Sophie Lund-Yates of Hargreaves Lansdown said EasyJet is a short-haul service, so demand should recover faster than long-haul airlines.

“These initiatives, along with our strong investment grade balance sheet, give easyJet new power to manage the further disruption of Covid-related travel, and quickly track our growth and strong shareholder interests. We provide a platform that brings about. “

EasyJet plans to increase its fleet of aircraft by 25, adding new slots at four airports, including London Gatwick Airport and Linate Airport in Milan, and increasing the number of aircraft at its seasonal bases.

Sophie Lund-Yates, a stock analyst at Hargreaves Lansdown, said the airline’s most important advantage is that demand should recover faster than long-haul airlines as a short-haul service.

She added: A major pillar of its success is also in EasyJet’s lucrative network, holding more popular slots at valuable airports.

“We cannot escape the fact that we need to climb further and will be mottled at best in the coming months. However, easyJet is concerned about the newly updated liquidity position and competitive advantage. It means that there are several optimistic reasons.

EasyJet shares closed at 496.5p on Tuesday, down 1.2%. This means that its value has fallen by about 40% in the last 6 months.

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Travel curbs and blockades send even higher losses on EasyJet

https://www.dailymail.co.uk/money/markets/article-10257367/Travel-curbs-lockdowns-send-losses-EasyJet-higher.html?ns_mchannel=rss&ns_campaign=1490&ito=1490 Travel curbs and blockades send even higher losses on EasyJet

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