Market turbulence hits easyJet profits

Market turbulence hits easyJet profits

easyJet has reported a fall in revenues for the three months to June 30th, as “difficult and uncertain economic and operating environment” takes a toll.

Total revenue per seat decreased by 8.3 per cent at constant currency over the period, or by 7.7 per cent on a reported basis, to £54.54 per seat.

At the same time, total revenue in the quarter at the low-cost carrier decreased by 2.6 per cent to £1,196 million.

Increased seat capacity was offset by the impact on yield of overall market capacity and cancellations as a result of significant external events.

easyJet was hit by terror attacks in Belgian capital Brussels as well as the loss of an EgyptAir aircraft on route from Paris to Cairo.


Significant disruption due to air traffic control strikes and congestion in France and across Europe also played a role, along with runway closures at Gatwick airport and severe weather leading to 1,221 cancellations.

easyJet is also believed to have lost around £40 million in the four weeks following the UK vote to leave the EU, with the drop in the pound forcing up the cost of fuel.

Elsewhere, the number of passengers carried increased by 5.8 per cent to 20.2 million, driven by an increase in capacity of 5.5 per cent to 21.9 million seats and load factor increasing by 0.3 percentage points to 92 per cent.

Carolyn McCall, easyJet chief executive, said: “The economic and operating environment has been difficult in the third quarter due to a number of factors including air traffic control strikes and other industrial action, runway closures at London Gatwick and severe weather.

“These factors combined with industry capacity growth in short haul continue to have an impact on industry yields at a peak time of year.

“More recently currency volatility as a result of the UK’s referendum decision to leave the EU as well as the recent events in Turkey and Nice continue to impact consumer confidence.

“Despite this, easyJet carried more passengers and achieved higher load factors during the third quarter as easyJet’s brand continued to resonate strongly across Europe.

“easyJet is strongly controlling costs and driving continued improvement in operational and customer delivery.

“We are focussed on the opportunities that are inevitable from a tougher environment.

“The easyJet business model remains robust, with a strong cash position, solid balance sheet and a flexible fleet plan.

“The easyJet team is confident in its ability to navigate the period ahead and drive long term advantage.”