Jet2 hikes dividend on record profit as holiday prices rise again
Jet2 hiked its interim dividend today after reporting record profit and revenue numbers in its busiest-ever six months of passenger numbers.
The airline and package holiday provider expects to pay an interim dividend per share of 4.4p, up 10 per cent year-on-year.
It came as operating profit increased 14 per cent to £701.5m, alongside a 15 per cent rise in revbenue to £5.1bn.
Such strong profitability was driven by the record 13.4m passengers who flew with the Leeds-headquartered airline, up from last year’s 12m total.
Shares soared over six per cent by mid-afternoon on Thursday.
Jet2 said demand had been characterised by a “higher proportion than usual booking much closer to their departure date, meaning pricing for both our package holiday and flight-only leisure travel products needed to remain consistently attractive.”
Jet2 ‘confident’ in business model
However, average package holiday prices grew six per cent to £904, with inflation leading to higher costs for consumers.
The AIM-listed firm in July said holiday prices had increased by 11 per cent, and warned of more “modest” price hikes over the summer.
It said on Thursday bookings and prices were likely remain in line with previously hiked forecasts.
“This result continues to demonstrate that our end-to-end package holidays and scheduled holiday flights… remain popular and resilient products,” Jet2 chief executive Steve Heapy said.
“Even in difficult economic times, the annual overseas holiday remains a highly valued and eagerly anticipated experience, often taking precedence over other discretionary spend.
He added: “As a result, we are confident that our proven business model – anchored to delivering a fantastic customer service with a well-established, trusted holiday brand – offers customers a compelling value proposition.”
Jet2 has outperformed some of Europe’s biggest low-cost airlines this year, largely on the back of its package holiday offering.
Shares are up nearly 14 per cent this year to date, while shares in Easyjet are up just 3 per cent and shares in Wizz Air are down over 40 per cent.