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Winter will be “challenging” for Easyjet
Easyjet is to concentrate on costs and higher aircraft utilisation after admitting increased competition had hit passenger revenues.
Chief executive Ray Webster admitted the winter would be “challenging” due to “intense” competition and the unknown factors of fuel prices and foreign exchange rates.
The no-frills carrier saw pre-tax profits for the year to the end of September rise by 21% to £62.2 million on total revenues up by 17% to £1.09 billion.
But while passenger carryings rose by 20% to 24.3 million with an improved load factor, revenue per passenger dropped by two per cent to £44.82 due to increased competition.
The Luton-based carrier described the results as “credible”, reflecting the resilience of the no-frills model.
Mr Webster said 2005 presented “good opportunities” by increasing sales through its growing network and ancillary revenues.
He said: “A strong focus on costs and higher aircraft utilisation will improve the business and will partly mitigate the impact of fuel and foreign exchange, which are beyond our control.”
Mr Webster added: “Nevertheless, we have a resilient business, operating in a growing market, which we can readily tailor to a variety of market conditions.”
Icelandair recently acquired 10% of Easyjet for £50 million and chairman Stelios Haji-Ioannou has stressed his intention to continue in the role due to his 10% shareholding.
“I would not exit from Easyjet as the brand is a key component of my overall easyGroup expansion plans,” he said, following a meeting with Icelandair chairman Hannes Smarasen last week.
Easyjet expanded its fleet to 92 aircraft operating 153 routes and 44 airports during the past year. The airline is to retire older, less efficient Boeing 737-300 aircraft.
Report by Phil Davies
Phil Davies
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