easyJet hit by rising fuel costs
Budget airline easyJet has posted a severe fall in profits for the full-year to the end of September as a result of rising fuel costs.
The airline posted underlying pre-tax profits of £43.7 million, compared with £123.1 million in the same period a year earlier – a fall of 64.5%
However, the no-frills airline said it expected a “substantial” improvement to profits in 2010 as capacity picks-up and it benefits from the effect of hedging on fuel prices.
The group said the results were “extremely resilient” and pointed out that it was one of the “very few” European airlines to make a profit in the last year.
The International Air Transport Association recently said major airlines continue to suffer amid higher fuel prices and a severe fall in passenger numbers due to the global recession.
According to the industry group, losses across the whole industry for the 2009 year could amount to £6.86 billion ($11 billion).
Meanwhile, easyJet said passenger numbers grew by 3.4% to 45.2 million.
However, chief executive Andy Harrison does expect that the next few months will be difficult. He comments: “We are focusing our efforts on further cost savings and efficiency improvements together with optimising route profitability and aircraft allocation.”
Earlier this month, easyJet’s rival Irish budget airline Ryanair, said half-year pre-tax profits came in at €419.4 million (£376.2 million), four times the €105.2 million reported in the same period last year.