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EasyJet reported a rise in annual profits following a second record-breaking summer, as the low-cost airline reassured investors that the travel outlook for travel next year was “positive”.
The carrier on Wednesday reported pre-tax profits of £610mn for the 12 months to the end of September, up from £455mn a year earlier.
Profits for the peak summer months rose 11 per cent to a record £960mn, as easyJet carried more passengers and airfares held steady. Its package holiday business also reported a strong year, as pre-tax profits rose 56 per cent to £190mn.
The airline forecast a “positive” outlook for its current financial year, when it plans to increase its flying schedules by 3 per cent.
The company also said it would more than double its dividend to 12.1 pence per share, up from 4.5 pence in 2023. Revenues rose 14 per cent over the year to £9.3bn, helped by an 8 per cent increase in capacity to 100.4mn seats.
“The outlook for easyJet is positive and travel remains a firm priority with consumers,” said Kenton Jarvis, easyJet’s chief financial officer, who will take over as chief executive early next year.
EasyJet’s results contrast with Europe’s two other major low-cost airlines, Ryanair and Wizz Air, which both saw profits fall over the summer. Ryanair has flagged pressures on airfares thanks to “consumer spending pressure”, while Wizz Air has faced major disruption problems due to issues with the engines on its planes.
EasyJet typically targets a higher end of the market, and competes with national carriers such as British Airways from more expensive airports. BA owner International Airlines Group reported record summer profits this year.
EasyJet said airline revenue per seat, a proxy for airfares that includes extras such as luggage and seat choices, rose 2 per cent in the year to £81.35.
However, the airline flagged disruption from the outbreak of conflict in the Middle East, and said headline costs excluding fuel rose 14 per cent as a result of higher flying volumes and “general industry cost pressures”.
It said the costs of disruption, particularly from air traffic control delays, “continued to run at too high a level”. It also had to cancel some flights and cut routes because of the Middle East conflict.
Overall, easyJet paid £187mn in compensation and welfare costs such as hotels or rebooked flights for passengers during periods of disruption. This was down from £211mn a year earlier, and the airline said resilience measures put in place during previous disruption mitigated some of these issues.
