The Week Ahead: EasyJet set to remain in the red as fuel bill bites

Airlines may have enjoyed a rally last week as the price of oil slipped, but that is unlikely to prevent the issue of fuel costs being a major focus of easyJet's half-year results tomorrow.

Noting that the budget carrier's "sensitivity is roughly such that a $10 move in fuel equates roughly £3m of cost", Wyn Ellis, of Numis Securities, believes the airline will report a pre-tax loss towards the higher end of the guidance of between £140m and £160m it gave at its update in January, despite the recent weakness of the dollar providing some relief.

Last week, eayJet trumpeted an impressive 35.1 per cent growth in passenger numbers in April. Nomura's Andrew Evans forecasts a fall in total revenue per seat of 2.3 per cent, "a result of weaker second-quarter pricing (a function of higher capacity growth in the second quarter and a drop-off in bookings during the poor weather) and lower ancillary revenues from bag charges".

Meanwhile, Mr Ellis says that in terms of easyJet's comments about the future, the market will "be especially sensitive ... with regard to bookings for the key summer months". EasyJet's rival FlyBe issued a profits warning last week, citing a slowdown in leisure passengers. Mr Ellis remains cautious, noting that "the consumer remains under pressure, particularly in the UK, and we believe that easyJet will be finding it difficult to recoup rising fuel costs via higher yields".



Today

Outsourcing will be in focus this morning, with Serco posting an update in the wake of recent reports of growing government caution over using the private sector to provide public services. The group announces its interim management statement today, and Espirito Santo believes its contract wins should be similar to the £1bn it saw in the same period a year before.

Thomas Cook is also reporting today, and JPMorgan Cazenove says the tour operator's operating loss for the first six months will accelerate by £40m to £170m, with a hit of roughly £20m from the recent unrest in Tunisia and Egypt and the same amount from Easter coming late in the year.

Results/Updates: Centrica, Hiscox, HSBC, Inmarsat, Lonmin, Serco, Telecity, Thomas Cook and Travis Perkins.



Tomorrow

Following on from Serco, fellow outsourcer Capita will update the market tomorrow, with Espirito Santo expecting it to match last year's performance. Analyst David Brockton notes that "greater acquisition spend has already been a notable feature of the period, with six businesses acquired to date through 2011 collectively worth at least £83m", but adds that "organic growth will be the key determinant for any sustainable re-rating".

In a similar vein, TUI Travel will follow in the footsteps of Thomas Cook with an update tomorrow, and despite facing the same issues, JPMorgan Cazenove believes losses over the first half will have improved by £2m to £312m, helped by "good trading (excluding UK and France) and positive foreign exchange movements".

Results/Updates: Balfour Beatty, BG Group, Capita, CSR, easyJet, G4S, Imperial Tobacco, InterContinental Hotels, Morgan Crucible, N Brown, National Express and Tui Travel.



Wednesday

Restaurant Group is expected to strike an upbeat tone when it posts an update alongside its annual meeting. Citigroup predicts that the company will end up seeing like-for-like sales growth of 2.5 per cent over the full year, which should cancel out cost inflation to keep its margins steady.

A year-end trading update from the Comet owner Kesa Electricals is also due out on Wednesday. Although Britain's economic outlook may be gloomy, Royal Bank of Scotland points out that about 70 per cent of the group's sales are overseas. The broker says data from France, Kesa's core market where it owns the Darty chain, shows an average rise of 5.2 per cent each month in consumer electrical sales over the first quarter Like-for-like sales in France are likely to have grown by 1 per cent over the year.

However, its analysts believe Kesa's UK losses will have grown to €10.7m, noting that "the market's focus has been on Comet's poor performance and whether the brand has a future in the UK market".

Results/Updates: Bovis Homes, Barratt Developments, Drax, FirstGroup, Greggs, International Personal Finance, J Sainsbury, Kesa Electricals, Prudential, Rathbones, Restaurant Group and Wood Group.



Thursday

Results/Updates: 3i, Aegis, Amlin, BT, Cookson, ENRC, Informa, Old Mutual, Pace, RSA, Supergroup, Tullett Prebon, Tullow Oil and Yule Catto.



Friday

Results/Updates: Catlin, Dignity, LSE, Petrofac and Spectris.

Economics Diary

Today

EU Sentix investor confidence index.



Tomorrow

BRC retail sales monitor; RICS house price balance; US import price index.



Wednesday

Bank of England inflation report; Trade balance; US budget statement; US oil inventories; US trade balance.

Thursday

EU industrial production; European Central Bank monthly bulletin; Industrial production; Manufacturing output; NEISR GDP estimate; US business inventories; US PPI; US retail sales; US unemployment data.



Friday

US CPI; US University of Michigan consumer sentiment.

News
people
News
people
Arts and Entertainment
Keys to success: Andrew and Julian Lloyd Webber
arts + entsMrs Bach had too many kids to write the great man's music, says Julian Lloyd Webber
Voices
Left: An illustration of the original Jim Crowe, played by TD Rice Right: A Couple dressed as Ray and Janay Rice
voices

By performing as African Americans or Indians, white people get to play act a kind of 'imaginary liberation', writes Michael Mark Cohen

PROMOTED VIDEO
News
i100
Arts and Entertainment
Hand out press photograph/film still from the movie Mad Max Fury Road (Downloaded from the Warner Bro's media site/Jasin Boland/© 2014 Warner Bros. Entertainment Inc.)
films'You have to try everything and it’s all a process of elimination, but ultimately you find your path'
Arts and Entertainment
Imelda Staunton as Dolores Umbridge in the Harry Potter films
books

New essay by JK Rowling went live on Pottermore site this morning

News
Russia Today’s new UK channel began broadcasting yesterday. Discussions so far have included why Britons see Russia as ‘the bad guy’
news

New UK station Russia Today gives a very bizarre view of Britain

News
people

Top Gear presenter is no stranger to foot-in-mouth controversy

Arts and Entertainment
Keira Knightley and Benedict Cumberbatch at the premiere of The Imitation Game at the BFI London Film Festival
filmsKeira Knightley tried to miss The Imitation Game premiere to watch Bake Off
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

The benefits of Recruitment at SThree...

£18000 - £23000 per annum + Comission: SThree: SThree, International Recruitme...

Trainee Recruitment Consultants

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

Finance Assistant - Part time - 9 month FTC

£20000 - £23250 Per Annum pro rata: Clearwater People Solutions Ltd: Pro rata ...

Marketing Manager

£40 - 48k + Benefits: Guru Careers: We are seeking a Marketing Manager to join...

Day In a Page

The drugs revolution starts now as MPs agree its high time for change

The drugs revolution starts now as MPs agree its high time for change

Commons debate highlights growing cross-party consensus on softening UK drugs legislation, unchanged for 43 years
The camera is turned on tabloid editors in Richard Peppiatt's 'One Rogue Reporter'

Gotcha! The camera is turned on tabloid editors

Hugh Grant says Richard Peppiatt's 'One Rogue Reporter' documentary will highlight issues raised by Leveson
Fall of the Berlin Wall: It was thanks to Mikhail Gorbachev that this symbol of division fell

Fall of the Berlin Wall

It was thanks to Gorbachev that this symbol of division fell
Halloween 2014: What makes Ouija boards, demon dolls, and evil clowns so frightening?

What makes ouija boards and demon dolls scary?

Ouija boards, demon dolls, evil children and clowns are all classic tropes of horror, and this year’s Halloween releases feature them all. What makes them so frightening, decade after decade?
A safari in modern Britain: Rose Rouse reveals how her four-year tour of Harlesden taught her as much about the UK as it did about NW10

Rose Rouse's safari in modern Britain

Rouse decided to walk and talk with as many different people as possible in her neighbourhood of Harlesden and her experiences have been published in a new book
Welcome to my world of no smell and odd tastes: How a bike accident left one woman living with unwanted food mash-ups

'My world of no smell and odd tastes'

A head injury from a bicycle accident had the surprising effect of robbing Nell Frizzell of two of her senses

Matt Parker is proud of his square roots

The "stand-up mathematician" is using comedy nights to preach maths to big audiences
Paul Scholes column: Beating Manchester City is vital part of life at Manchester United. This is first major test for Luke Shaw, Angel Di Maria and Radamel Falcao – it’s not a game to lose

Paul Scholes column

Beating City is vital part of life at United. This is first major test for Shaw, Di Maria and Falcao – it’s not a game to lose
Frank Warren: Call me an old git, but I just can't see that there's a place for women’s boxing

Frank Warren column

Call me an old git, but I just can't see that there's a place for women’s boxing
Adrian Heath interview: Former Everton striker prepares his Orlando City side for the MLS - and having Kaka in the dressing room

Adrian Heath's American dream...

Former Everton striker prepares his Orlando City side for the MLS - and having Kaka in the dressing room
Simon Hart: Manchester City will rise again but they need to change their attitude

Manchester City will rise again but they need to change their attitude

Manuel Pellegrini’s side are too good to fail and derby allows them to start again, says Simon Hart
Isis in Syria: A general reveals the lack of communication with the US - and his country's awkward relationship with their allies-by-default

A Syrian general speaks

A senior officer of Bashar al-Assad’s regime talks to Robert Fisk about his army’s brutal struggle with Isis, in a dirty war whose challenges include widespread atrocities
‘A bit of a shock...’ Cambridge economist with Glasgow roots becomes Zambia’s acting President

‘A bit of a shock...’ Economist with Glasgow roots becomes Zambia’s acting President

Guy Scott's predecessor, Michael Sata, died in a London hospital this week after a lengthy illness
Fall of the Berlin Wall: History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War

Fall of the Berlin Wall

History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War
How to turn your mobile phone into easy money

Turn your mobile phone into easy money

There are 90 million unused mobiles in the UK, which would be worth £7bn if we cashed them in, says David Crookes