EasyJet flags uncertain outlook as fuel costs rise and bookings weaken
EasyJet's Financial Performance and Market Challenges
By Yamini Kalia and Joanna Plucinska
First-Half Loss and Financial Results
May 21 (Reuters) - British budget airline easyJet reported a first-half loss of 552 million pounds ($741.39 million) on Thursday, in line with previous guidance, but said its full-year outlook remains uncertain as the Iran war drives up fuel costs and dampens summer bookings.
Impact of Global Conflict on Aviation
The conflict has disrupted global aviation, sending jet fuel prices up more than 80% since late February and forcing airlines to raise fares, cut capacity or absorb margin pressure as flows through the Strait of Hormuz are constrained.
Profit Expectations Across European Airlines
European airlines have downgraded profit expectations in recent weeks as the prospect of a prolonged conflict pushes fuel costs higher, particularly as hedges expire.
Easyjet's first-half loss was broadly in line with the 540 million pound to 560 million pound loss it had warned of in April.
EasyJet's Strategy and Bookings Outlook
"Our strategy is clear - through disciplined growth, accelerated upgrading, and continued expansion of easyJet holidays, we aim to bounce back from this year’s Middle East-related setbacks," Chief Executive Kenton Jarvis said in a statement.
Booking Trends and Customer Behavior
The carrier said its second-half bookings were 58% sold as customers booked vacations closer to home. Easyjet's April-September bookings were 77% sold at the same point a year earlier.
Year-on-Year Booking Strength
However, in-month bookings were seeing year-on-year strength, as travellers continue to book their trips closer to their departure dates.
($1 = 0.7445 pounds)
(Reporting by Yamini Kalia in Bengaluru; Editing by Sonia Cheema and Louise Heavens)
