easyJet Net Profit Dips 24 Percent On Currency
UK budget airline easyJet reported a 24 percent drop in full year net profit as currency fluctuation impacted on its costs.
Profit net of tax for the year to end September came in at GBP£325 million (USD$428 million), from fiscal 2016’s £427 million. Pre-tax profit for the year was £408 million, down 17.3 percent.
Total revenue of £5.05 billion was up 8.1 percent, but headline costs ex-fuel jumped 16.9 percent to £3.58 billion as currency impact added £101 million to costs. Fuel was a bright spot with costs falling £52 million from last year.
easyJet carried 80.2 million passengers during the year from 73.1 million as it added 6.8 million more seats. It pushed load factor up by 1 percentage point to 92.6 percent in the process.
During the year, easyJet agreed to acquire part of bankrupt German carrier Air Berlin. As part of the EUR€40 million deal easyJet will operate up to 25 A320-family aircraft from Berlin’s Tegel Airport. The acquisition is expected to make a headline loss of £60 million in 2018.
The transaction is expected to close in December 2017, assuming antitrust and regulatory approval is received from the European Union.
The Luton-based airline expects to add 6 percent capacity in 2018, and see a low to mid single digits increase in 1H18’s revenue per seat. Headline cost per seat excluding fuel is forecast to edge up by 1 percent in the period.
The annual result presentation was CEO Carolyn McCall’s last before she leaves to join UK broadcaster ITV. Her successor Johan Lundgren, an industry veteran with over 30 years experience in the travel sector, will join the airline on December 1.