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EasyJet losses spiral as capacity is slashed until end of year
EasyJet is braced to lose almost £850 million in the 2020 financial year as its Chief Executive lamented the unimaginable damage Covid has inflicted on travel.
The airline said its headlines loss – the first in its history – will hover between £815m and £845m for the 12 months to 30 September.
It also painted a bleak picture for the first three months of the 2021 financial year, with capacity cut by 75% between October and December.
Chief Executive Johan Lundgren said: "At the beginning of this year, no one could have imagined the impact the pandemic has had on the industry.
"Aviation continues to face the most severe threat in its history and the UK Government urgently needs to step up with a bespoke package of measures to ensure airlines are able to support economic recovery when it comes.
"EasyJet came into this crisis in a very strong position thanks to its strong balance sheet and consistent profitability. This year will be the first time in its history that easyJet has ever made a full year loss."
More positively, the carrier said early booking levels for summer ’21 are in line with previous years.
In the July-August quarter, easyJet operated 38% of planned capacity with flying declining ‘significantly’ during September when customer demand was ‘materially affected by changes in government travel guidance and quarantine rules’.
"Customers are booking at a very late stage and visibility remains limited," the airline said.
Lundgren added: "EasyJet has adapted and risen to the challenges presented by the pandemic by taking decisive actions to minimise losses, bolster liquidity and reduce cash burn while launching a major restructuring programme, having completed the UK consultation and commenced consultations in a number of key countries.
"Throughout we have taken a very prudent and conservative approach to capacity and this disciplined approach has seen us deliver a better than expected cash burn outcome in Q4 and will see us continue to focus on profitable flying over the winter season in order to minimise losses and cash burn during the first half of 2021."
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