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EasyJet reports ‘robust’ performance in 3Q trading update
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EasyJet reports ‘robust’ performance in 3Q trading update

UK LCC easyJet reported a 11.4% revenue increase to £1.8 billion ($2.2 billion) in a trading update for the third quarter ended June 30. Ancillary revenue was 14.3% higher at £374 million.

“EasyJet’s third-quarter performance was robust and, despite the tougher macroeconomic conditions, was in line with expectations,” easyJet CEO Johan Lundgren said. “We remain very focused on delivering our revenue initiatives and driving costs down to enhance our profitability per seat.”

During the three-month period, passenger numbers rose 8% to 26.4 million. ASKs were up 10.6%, met by an 8.7% RPK increase. This mismatch caused average load factors to slip 1.7 points to 91.7%, but easyJet’s revenue per seat rose 1.3%, while cost per seat fell 0.5%.

EasyJet said the revenue-per-seat increase (0.7% at constant currency) came from a focus on optimizing late yields, ancillary revenue growth, improved capacity-discipline among easyJet’s competitors, and the timing of public holidays.

However, high prior-year comparative figures, softening macroeconomic demand, Brexit-related uncertainty in the UK (easyJet is now 50.6%-EU owned, excluding UK shareholders), and the operational ramp-up in Berlin all acted as headwinds during the quarter.

The UK LCC said its expanded Berlin operation—using assets acquired from bankrupt airberlin—is now “maturing in line with other new bases” and “showing solid unit revenue improvement.”

EasyJet used the third-quarter trading update to announce that Ryanair COO Peter Bellew, who recently resigned from the position at the Irish LCC, has joined easyJet as COO.

The carrier said it has made good progress with its continued focus on operational resilience—a strategy that will be supported by bringing Bellew on board, given his crisis-management experience at Ryanair.

Investments in operational resilience “contributed significantly” to the 4% cost per seat (ex-fuel, constant currency) decrease during the quarter, with “significantly fewer” costly delays and cancellations, which had a knock-on impact on customer service.

“EasyJet has improved its on-time performance since the difficult 2018 summer. Despite the air traffic environment remaining challenging, easyJet’s focus for this summer is on ensuring flight fulfillment and reducing severe delays for its customers. EasyJet experienced 847 cancellations in Q3 2019 compared to 2,606 cancellations in Q3 2018, while delays of greater than 3 hr. decreased by 32% compared to Q3 2018,” easyJet said…

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