Budget airline easyJet expects to deliver record profits over its peak season

The company swung to a record headline pre-tax profit of £203m for the three months to June 30, against losses of £114m a year ago after increasing its flight programme by 5 per cent to 146,816.

The group said it was on course for another record-breaking profit performance in its final quarter to September 30 as it said bookings remain solid.

Johan Lundgren, chief executive of easyJet, said: “We are absolutely focused on mitigating the impact of the challenging external environment on our customers and flying them on their well-earned holidays.

“We continue to see good momentum as we move into the fourth quarter where we will be operating over 160,000 flights and expect to deliver another record profit before tax performance.

“This winter we are adding more than 15 per cent capacity and we see bookings ahead of the same period last year.”

Richard Hunter, Head of Markets at interactive investor, commented: “It is difficult to avoid the conclusion from these numbers that, operationally and financially, easyJet is flying.

“Airlines have desperately been trying to reverse the ravages which the pandemic wrought, and persistent customer demand has helped this target. For easyJet, there are additional factors at play on the revenue line which have given the group additional lift.

“Overall revenues rose by 34 per cent, underpinned by a healthy 30 per cent from passengers. However, its other lines are now making a notable difference to the overall picture.

"Ancillary revenues, which include the likes of customer payments for personally allocated seats, baggage and food, rose by 26 per cent. This is something which the company has focused on more recently, and the ancillary yield per passenger is 87 per cent ahead of the third quarter of 2019, just prior to the pandemic.”

Mr Hunter added: “As ever, there are potential flies in the ointment, not least of which is the current sector challenges of constrained air space and Air Traffic Control disruptions. The resilience of the consumer had also been a concern given the parlous economic backdrop in the UK, but for the moment there are few signs of holidays being sacrificed come what may.”

easyJet is clearly on a strong flight path, but the share price recovery still has far to go, according to Mr Hunter.

He added: “Despite a hike of 26 per cent over the last year, as compared to a decline of 0.4 per cent for the wider FTSE250, the shares remain down by 24 per cent over the last two years and by 60 per cent from the levels leading into the pandemic, when the share price was nudging £13. This latest update should provide significant promise on more immediate prospects, with the market consensus of the shares as a strong hold quite likely to come under upward pressure.”