Brexit Uncertainty Hits EasyJet

EasyJet has warned of a tough trading environment after reporting a £275 million pre-tax loss in the six months to March 31

The airline has warned that revenue per seat in the second half of the year will be down as consumers are deterred by uncertainty over Brexit and economic weakness in Europe.

The loss compares to a £18 million loss in the same period the year before.

Profit expectations for 2019 remain unchanged but, capacity growth in 2020 will be ‘at the lower end’, easyJet said.

Passenger numbers increased by 4.9 million (13.3%) to 41.6 million, total revenue increased by 7.3% to £2,343 million. Total revenue per seat decreased by 6.3%, to £50.71.

Forward bookings for the third quarter are three percentage points behind last year at 72% and flat year on year at 34% for the fourth quarter.

Revenue per seat at constant currency in the second half is now expected to be slightly down.

“This is not helped by the ongoing negative impact of Brexit-related market uncertainty as well as a wider macroeconomic slowdown in Europe,” easyJet said in a statement.

Chief executive Johan Lundgren said: “I am pleased that despite tougher trading conditions, we flew more than 41 million customers, up 13% on last year, performed well operationally with 54% fewer cancellations in the period and customer satisfaction with our crew is at an all-time high.

“Cost control remains a major priority for easyJet.  Our focus is on efficiency and on innovation through data and we are on track to deliver more than £100m in cost savings during 2019.

“We are well-equipped to succeed in this more difficult market through a number of short term customer and trading initiatives for the summer; measures to improve our operational resilience; and by focusing on what is most important to customers – value for money, punctuality and great customer service.”