Jet2 hikes dividend after record passenger numbers boost profit
Budget airline Jet2 has hiked its dividend by more than a third after record passenger numbers helped its revenue and profit soar during its latest financial year.
The Aim-listed carrier, which is based out of Leeds Bradford Airport and is now the UK’s third-largest airline, said in a preliminary update for the year ended March 31, 2024, that its revenue rose 24 per cent from £5bn to £6.2bn.
It flew a total of 17.7million passengers in the financial year, a rise of nine per cent on its previous 12 months, which was further boosted by the fact it secured a higher margin per passenger on its passage holidays – up 15 per cent.
Its cash base minus customer deposits – an important barometer of resilience for highly volatile sectors like airlines – increased from £1.12bn to £1.33bn.
Jet2’s operating profit rose nine per cent over the year, up to £428m, while its pre-tax profit rose by a third, breaking the £500m barrier.
This helped the board recommend a final dividend of 10.7p per share; an increase of 34 per cent on last year’s 8p payout.
Jet2 CEO Steve Heapy said: “These results underlined the popularity, resilience and flexibility of our holiday products and also our leading brand position, as despite the continuing inflationary pressures, millions of UK customers still chose to prioritise their disposable income for a rejuvenating and relaxing Jet2 holiday.”
The firm’s future bookings look sound, with summer 2024 seat capacity 12.3 per cent higher than last summer, and package holiday bookings up seven per cent.
But it caveated that passengers are tending to book holidays increasingly last minute, meaning the airline is having to keep prices lower for longer to ensure its holidays and flights remain attractive.
Alongside the results, Jet2’s new chair, Robin Terrell, who took over from its founder Philip Meeson last year, revealed the firm had exercised rights on a remaining 35 Airbus aircraft, taking the carrier’s delivery stream of aircraft through to 2035.