EasyJet warning despite £248m profits

 

Budget airline easyJet revealed a rise in profits today but warned it will become harder to pass higher fuel prices on to passengers.

The group reported a 31.5% increase in underlying profits to £248 million in the year to September 30, which was at the upper end of expectations, after a sharp rise in the number of business passengers.

It said around 45% of winter seats are already booked - about the same level as last year - but warned that weak consumer confidence across Europe will slow the rate at which higher costs can be passed on to passengers.

The group also announced it will trial allocated seating on selected routes in the spring, following a similar move by rival Ryanair.

The record profits for the group came after it offset a £100 million increase in its fuel bill by focusing on cost controls and improved customer satisfaction levels. Its on-time performance improved by 13 percentage points to 79%.

But the group warned the macro-economic environment remains challenging, while it is facing higher costs, including increased taxation and a £220 million rise in its fuel costs.

As a result it is taking a "cautious approach" to expanding its fleet, which will lead to unchanged capacity in the first half of its financial year and growth of around 4% for the year as a whole.

It expects first-half passenger revenues to increase by "mid-single digits", helped by higher bag charges and other ancillary revenues.

The group announced payments to shareholders of £195 million, which is about £5 million more than previously expected amid pressure from its founder Sir Stelios Haji-Ioannou, who along with his family is a major shareholder.

The Luton-based airline has been expanding its appeal to business customers, which tend to provide higher profits, by flying more to business routes and offering flexible fares.

Passengers travelling on business routes increased by one million to 9.5 million in the year.

Total revenues rose 16% to £3.5 billion while revenues per seat were up 3.4% to £55.27, helped by a rise in ancillary revenues.

Douglas McNeill, an analyst at Charles Stanley Securities, said Carolyn McCall's first full year in charge had been a good one.

But he added: "Cost inflation looks to be greater than we had thought and pricing isn't strong enough to compensate - the upshot is that our full-year 2012 forecasts may have to be reduced."

PA

Suggested Topics
Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Collections Agent

£14000 - £16000 per annum: Recruitment Genius: This company was established in...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40k: SThree: SThree are a global FTSE 250 busi...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + competitive: SThree: SThree are a global FTSE 250 ...

Reach Volunteering: Trustees with Finance, Fundraising and IT skills

Voluntary and unpaid, reasonable expenses reimbursable: Reach Volunteering: St...

Day In a Page

Isis profits from destruction of antiquities by selling relics to dealers - and then blowing up the buildings they come from to conceal the evidence of looting

How Isis profits from destruction of antiquities

Robert Fisk on the terrorist group's manipulation of the market to increase the price of artefacts
Labour leadership: Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea

'If we lose touch we’ll end up with two decades of the Tories'

In an exclusive interview, Andy Burnham urges Jeremy Corbyn voters to think again in last-minute plea
Tunisia fears its Arab Spring could be reversed as the new regime becomes as intolerant of dissent as its predecessor

The Arab Spring reversed

Tunisian protesters fear that a new law will whitewash corrupt businessmen and officials, but they are finding that the new regime is becoming as intolerant of dissent as its predecessor
King Arthur: Legendary figure was real and lived most of his life in Strathclyde, academic claims

Academic claims King Arthur was real - and reveals where he lived

Dr Andrew Breeze says the legendary figure did exist – but was a general, not a king
Earth has 'lost more than half its trees' since humans first started cutting them down

Axe-wielding Man fells half the world’s trees – leaving us just 422 each

However, the number of trees may be eight times higher than previously thought
Theme parks continue to draw in thrill-seekers despite the risks - so why are we so addicted?

Why are we addicted to theme parks?

Now that Banksy has unveiled his own dystopian version, Christopher Beanland considers the ups and downs of our endless quest for amusement
Tourism in Iran: The country will soon be opening up again after years of isolation

Iran is opening up again to tourists

After years of isolation, Iran is reopening its embassies abroad. Soon, there'll be the chance for the adventurous to holiday there
10 best PS4 games

10 best PS4 games

Can’t wait for the new round of blockbusters due out this autumn? We played through last year’s offering
Transfer window: Ten things we learnt

Ten things we learnt from the transfer window

Record-breaking spending shows FFP restraint no longer applies
Migrant crisis: UN official Philippe Douste-Blazy reveals the harrowing sights he encountered among refugees arriving on Lampedusa

‘Can we really just turn away?’

Dead bodies, men drowning, women miscarrying – a senior UN figure on the horrors he has witnessed among migrants arriving on Lampedusa, and urges politicians not to underestimate our caring nature
Nine of Syria and Iraq's 10 world heritage sites are in danger as Isis ravages centuries of history

Nine of Syria and Iraq's 10 world heritage sites are in danger...

... and not just because of Isis vandalism
Girl on a Plane: An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack

Girl on a Plane

An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack
Why Frederick Forsyth's spying days could spell disaster for today's journalists

Why Frederick Forsyth's spying days could spell disaster for today's journalists

The author of 'The Day of the Jackal' has revealed he spied for MI6 while a foreign correspondent
Markus Persson: If being that rich is so bad, why not just give it all away?

That's a bit rich

The billionaire inventor of computer game Minecraft says he is bored, lonely and isolated by his vast wealth. If it’s that bad, says Simon Kelner, why not just give it all away?
Euro 2016: Chris Coleman on course to end half a century of hurt for Wales

Coleman on course to end half a century of hurt for Wales

Wales last qualified for major tournament in 1958 but after several near misses the current crop can book place at Euro 2016 and end all the indifference