EasyJet takes £82m hit on weak pound as half-year losses deepen

The firm’s chief executive says the results are in line with market expectations

The company has previously warned of lower profits due to the fall in the currency

Budget airline easyJet posted a bigger-than-expected loss in the first half of the year, hit by the later timing of Easter and the post-Brexit slump in the value of the pound.

The airline reported pre-tax losses of £212m for the six months to the end of March, compared to an average Reuters analyst estimate of £195.75m.

Some £82m of the company’s losses were down to a weaker pound and £45m were due to the timing of Easter, the company said.

The budget airline pays for fuel in dollars, which makes it more expensive when the pound is weaker.

EasyJet’s chief executive Carolyn McCall said the airline delivered a “resilient performance” in line with market expectations and “reflects the movement of Easter into the second half as well as currency effects which together had an estimated impact of circa £127m on the bottom line”.

Total revenue grew 3.2 per cent and the airline flew a record 33.8 million passengers in the six months, a 9 per cent increase from the same period last year.

“Our bookings for the summer are ahead of last year showing that demand to fly remains strong and reflects growing evidence that consumers are prioritising expenditure on flights and holidays above other non-essential items,” Ms McCall said.

“Looking ahead, we are seeing improving revenue per seat trend as well as the continued reduction of competitor capacity growth. Cost performance for the full year will continue to be strong.”

Investors were left unimpressed with the company’s results, sending the airline’s shares down more than 7 per cent.

The company had previously warned of lower profits due to the fall in the currency.

On Tuesday, Martin Lane, managing editor of money.co.uk said travellers should brace for price hikes.

“I’m concerned this is one industry that could be in for a rocky road ahead and perhaps our obsession with holidaying abroad will be replaced with camping trips and staycations,” he said.