By Scott Kanowsky
Investing.com -- EasyJet (LON: EZJ ) has warned that it expects to post a third straight annual loss despite the budget airline showing "resilience" against external headwinds and summer disruptions.
In a trading update, the U.K.-based carrier said that it will report a full-year group headline pre-tax loss of between £170M and £190M.
Europe's second biggest discount flyer cited the impact of "operational issues" affecting the aviation industry throughout its third quarter ended on June 30, when a surge in post-pandemic passenger demand and labor shortages led to an increase in cancellations. Subsequent disruption costs came in at around £75M, while a recent surge in the value of the U.S. dollar also factored into a one-time expense of £64M.
Factoring in the anticipated loss, easyJet added that its board will not recommend a dividend payment for the fiscal year to September 30, 2022.
However, easyJet said that its operations have still improved significantly, thanks to "management actions" taken to mitigate potential issues. As a result, fourth quarter flight cancellations were below pre-COVID levels.
"We face the uncertain macro-economic environment with many strengths through our brand, network and business model which enable us to provide low fares to millions despite the rising cost of living," said chief executive officer Johan Lundgren in a statement.
Looking ahead to the first quarter of its 2023 trading year, easyJet predicted that passenger figures will climb to 20M, rising by more than 30% year-on-year. Load factors - a measure of available seats that have been filled with passengers - are also "currently ahead" of the same point in 2019.
The firm will unveil its complete 2022 results on November 29.
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.