EasyJet (LON: EZJ) shares gained Tuesday morning after the low-cost carrier released a first-half trading update, revealing it expects to exceed FY23 market expectations.
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The stock is currently trading 2.75% above Monday's close at 525p per share.
The company said it has seen strong demand and anticipates exceeding current market profit expectations of £260 million for FY23. Meanwhile, easyJet reduced its first half “seasonal” losses, revealing that its headline loss before tax for the first half is expected to be between £405 million and £425 million.
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The results continue the theme of strong travel demand over the last year or so, with inflation, the cost of living crisis, and other macroeconomic factors yet to impact consumer spending in the airline sector.
“Demand for easyJet's flights and holidays has continued to grow in the half, resulting in more than a £120 million pound improvement in our performance as well as a billion-pound revenue improvement year on year. This is further enhanced by our transformed network of popular destinations and improved revenue capability,” said Johan Lundgren, CEO of easyJet.
Passengers in the six months ended March 31 grew 35% year-over-year, while capacity grew around 9%. In addition, 99.8% of planned flights operated despite the impact of French air traffic control strikes. Capacity from January to March grew by 40%, and EasyJet expects it to be at pre-pandemic levels by peak summer.
“We see continued strong booking momentum into summer as customers prioritise spending on travel and choose airlines like easyJet offering the best value and destination mix, as well as easyJet holidays which is continuing its steep growth trajectory as the fastest growing holidays company in the UK,”
Furthermore, EasyJet said third-quarter revenue per seat is expected to rise 20% YoY. The airline also upgraded EasyJet Holidays' growth expectations to around 60% YoY.
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