Easyjet to report as summer travel booms
Easyjet is set to give investors a first picture of performance over one of the busiest summers on record when it reports third quarter results on Wednesday.
Like other major airlines, the budget carrier has cashed in on a post-pandemic resurgence in travel demand over the last couple of years.
Easyjet swung back to profit last year and said in April it was eyeing up a second consecutive summer of record earnings as flight bookings soared. Capacity is set to rise 8 per cent over the second half.
But despite the boom, investors have reacted tepidly.
Flight cancellations stemming from the conflict in the Middle East and capacity constraints at European airports have conspired to send shares down over eight per cent this year to date.
The stock hit further turbulence in May, when chief executive John Lundgren announced he would step down at the beginning of next year.
Shares fell nearly 10 per cent immediately following the announcement, signalling investor concern over the exit of a man who helped steer the company through a pandemic and lasted seven years in the top job.
“Markets didn’t react too well to easyJet’s last set of results, despite half-year revenues soaring 22 per cent to £3.3bn. That was largely thanks to a weak outlook in the group’s commentary on bookings and revenue per seat in the short term,” Aarin Chiekrie, equity analyst at Hargreaves Lansdown, said.
Chiekrie, however, said there would be “limited transition risk” surrounding Lundgren’s departure, with his successor already lined up in the form of chief financial officer, Kenton Jarvis.
“Next week’s third-quarter results shouldn’t throw up too many surprises. Travel remains important for customers, so an increased ability to meet this demand will be key to lifting the group’s fortunes.”