EasyJet has updated investors on its profit and full year 2024 outlook with the airline announcing an improvement on earnings as it moves towards its medium term targets.
ADVERTISEMENTEasyJet delivered a 16% rise in year-over-year profit in its third-quarter as a result of strong summer travel demand.
Profit before tax came in at £236m (€280m) for the three months ended 30 June, compared with £203m (€241m) reported a year earlier. Meanwhile, easyJet said the outlook for its fiscal 2024 was positive.
“Adjusted pre-tax profit of £236 million for the quarter represents an increase of 16% from the previous year, and is ahead of the estimated figure of £219 million. This result was underpinned by revenues of £2.63 billion, an increase of 11% on the corresponding period and in line with expectations. Within this number, passenger revenue (which accounts for 61% of the group total) rose by 7%, but the other strands of the group’s income are showing promising signs of making an increasingly valuable contribution to the group’s fortunes," Richard Hunter, head of markets at Interactive Investor, said.
Hunter also noted that ancillary revenues, which include the likes of customer payments for personally allocated seats, baggage and food, now account for 26% of sales and grew by 11% over the period.
"Of equal interest is the performance of easyJet holidays, which has all but come from a recent standing start to now represent 13% of group revenues. A pre-tax profit of £73 million compares to £49 million a year before, with revenues rising by 42% and passenger growth of around a third. As such, easyJet has upped guidance for the unit to make a full-year profit contribution in excess of £180 million, which would itself equate to 48% growth."
The market analyst highlighted how the launch of the holidays unit seems to have come at the right time with cost-conscious consumers searching for value packages.
"Passenger numbers and capacity are also on the up, with revenue per seat having nudged ahead by 1% despite the recent travails seen elsewhere in the sector. The load factor continued at a consistent 90%, with easyJet noting that it had sold 1,5 million more seats than the previous peak summer period and that it was nearing a full-year capacity of 100 million seats, with 69% of the final quarter already sold," Hunter also said.
EasyJet's share price was up 5.33% on Wednesday after the earnings update.
