UK's Jet2 warns of slower summer bookings as Mideast conflict weighs on travel
Jet2 Faces Challenges Amid Middle East Conflict
Impact of Geopolitical Uncertainty on Bookings
April 29 (Reuters) - British travel company Jet2 warned on Wednesday that uncertainty over the Iran war was limiting its outlook for seat occupancy in the peak summer travel season, after bookings slowed from levels seen in February.
The company said summer bookings were up 7.7% from a year earlier. That is lower than the 8% growth in bookings it reported in February.
Sector-Wide Effects of Middle East Tensions
The aviation and leisure travel sector has come under pressure due to the conflict in the Middle East, with the Strait of Hormuz blockade causing jet fuel shortages and customer cancellations rising amid uncertainty.
Changing Customer Booking Patterns
Jet2, the UK's third-largest airline, said customers are booking vacations closer to departure since the start of the conflict.
Financial and Operational Responses
"At present, Q1 (April, May, June) combined average load factor is in line with the prior year, with the current geopolitical uncertainty limiting visibility for the peak summer season and beyond," the company said in a statement.
Jet Fuel Hedging and Profit Expectations
It noted that 87% of its summer jet fuel requirements were hedged amid the jet fuel crisis and said it expects annual operating profit in line with market expectations for the year ended March 31, 2026.
Pricing Strategy and Market Reaction
JPMorgan analyst Harry Gowers notes that Jet2's pricing could be weaker than prior trends this summer, as the company said it remains committed to "attractive pricing" to appeal to customers.
Shares of the holiday package provider fell as much as 8.41% to 980 pence, before recovering to rise 0.5%.
Reporting Credits
(Reporting by Simone Lobo in Bengaluru; Editing by Rashmi Aich)
