After two years of billions of dollars in losses, Britain’s biggest low-cost airline has reported a record summer as fares soar.
Between July and September, easyJet made total profits of £674m – that’s an average profit of more than £20 per passenger.
The Luton-based airline has announced its full year results for the 12 months ended September 30, 2022.
The headline loss will still show a full-year loss of £178m – or £20,000 an hour. But UK travel restrictions were in place for most of the first half.
Less than a year ago, fear of the Omicron tribe led to Britain imposing the most draconian rules on all incoming travellers. On November 30, 2021, a mandatory quarantine was introduced for all travelers while awaiting the results of the PCR tests.
The price of aviation fuel doubled from that point a year ago until early summer – but since then it has slipped back to around 50 percent. In addition, the pound has fallen against almost all other currencies. But easyJet is well ‘hedged’ – with futures to avoid price shocks. Overall, however, expensive oil leads to higher fares and less choice.
But despite the cost of living crisis and the UK slipping into recession, it’s showing many who can afford a holiday are content to shell out high fares to snag some sunshine or skiing.
Fares will be 18 percent higher over the coming Christmas period than in 2021.
A return flight between Manchester and Tenerife over Christmas and New Year currently costs over £500 return, while top fares for Gatwick to Geneva – a 100 minute flight – are currently £1,111 return. Both prices are without luggage.
The airline’s chief executive, Johan Lundgren, said: “EasyJet does well in difficult times. Legacy carriers will struggle in this costly environment. Consumers will protect their holidays but look for value and easyJet will be the beneficiary at its primary airport network as customers vote with their wallets.
“Over the next year, we are targeting customer growth and are well positioned to increase returns and margins while maintaining a rigorous focus on costs.”
Package travel offshoot easyJet Holidays had a pre-tax profit of £38m. Ashley Quint, a holiday designer, said the airline is “putting a very big bet on easyJet Holidays”.
He said: “It is fully dependent on the UK and has big ambitions to take market share from Jet2 and Tui by promoting the strong frequency and route portfolio. This will be a strong narrative for the future – we can already see it in stores.”
Passengers have been hit by hundreds of last-minute cancellations from easyJet over the summer, particularly at its main Gatwick base. According to the airline, there were “fewer daily cancellations” in late summer than in early summer.
“Ancillary revenue per seat” rose by almost a third from £15.06 to £19.43.
According to easyJet, business travel on domestic routes has fallen back to 95 percent of the 2019 level.
The airline also announced plans to install WiFi on all aircraft by September 2023.