easyJet 6-month performance seen as robust, despite losses

Compared to the same six-month period for the 2015 financial year when the company made a profit of £7.0 million, easyJet has reported losses this time around amounting to £24.0 million. Despite this, Carolyn McCall, easyJet Chief Executive said “easyJet has delivered a robust financial performance during the half year despite the well-publicised external events.”
The airline has struggled, as have others, with the effects of increased security concerns resulting in flight cancellations after the downing of a plane at Sharm-el-Sheikh, along with the terrorist attacks in Paris in November and Brussels in March. This was further exacerbated by the air traffic control strikes in France. In an effort for the airline to boost passenger numbers, flight costs were lowered, which had a subsequent impact on overall results.
In response to this situation, McCall commented that “This half has had external events that we haven’t seen come close together in this way for over a decade,” adding, “”April was particularity awful on yields because of Brussels and the tail-end of Paris, but there’s an improving trajectory on that for May and June.” She also confirmed that easyJet was witnessing heavy demand for beach holidays in Italy, Greece, Spain and Portugal.
easyJet faces further problems with the number one low-cost carrier, Ryanair, among others, increasing capacity through reduced fares thanks to low fuel prices. However, the airline remained positive with regard to future growth, in particular announcing that it intends to increase dividends to 50% from the current 40% level, subject to shareholder approval at the next annual shareholder meeting.
In summary, for the six-month period compared to the same period in 2015, total revenue was down 0.3% to £1.77 billion, giving a pre-tax loss of £24.0 million and a constant currency profit before tax of £5.0 million. Basic earnings per share showed a loss of 5.1 pence, down 6.4 pence. Constant currency cost per seat was down 4.2% at £52.62, but constant currency cost per seat including fuel was up 7.4% at £52.46. Capacity increased by 7.4% to 34.5 million, load factor remained static at 89.7%, while passenger numbers rose 7.4% to 31.0 million. (£1.00 = USD$1.44 at time of publication.)