EasyJet Plc reiterated its plan to gear up operations to near pre-pandemic levels through the summer high season, as an easing of travel restrictions unleashes pent-up demand.
Europe’s second-biggest discount carrier managed to narrow its estimated loss in a fiscal first half roiled by the rise of the omicron variant of Covid-19 and has turned its focus to bringing back capacity. Booking volumes for summer are currently tracking ahead of the same time in 2019, the company said.
European airlines have seen a turnaround in ticket sales after authorities decided to live with the less-severe Covid infections and loosen travel curbs. EasyJet went from 50% of its 2019 schedule in January to 80% by March. The transition has been challenging, with the Luton, England-based carrier struggling to contend with rostering issues caused by renewed outbreaks among staff.
“We’re confident in our plans for this year and beyond which will see EasyJet emerge as one of the winners in the recovery,” Chief Executive Officer Johan Lundgren said on a call with reporters. “We remain absolutely focused on creating shareholder value.”
The company estimates its loss narrowed to between 535 million pounds and 565 million pounds ($696 million-$735 million) for the first half ended March 31, compared with a 701 million-pound loss in the year-earlier period.
Rising energy costs, staffing issues, and ramp-up challenges mean “the road to a full recovery remains long and bumpy,” said Allegra Dawes, senior airlines analyst at Third Bridge.
EasyJet shares were up 0.8% to 546.80 pence as of 10:39 a.m. in London.
The flying schedule for the current quarter will be about 90% of 2019 levels, the company said in a statement Tuesday. EasyJet is seeing strong demand in Greece, and expects to be the biggest carrier to the Greek islands this summer.
“The leisure destinations—the beach routes—are doing very well for us,” Lundgren said. “Those traditional destinations around the Mediterranean are doing really well.”
Larger rival Ryanair Holdings Plc has also forecast a strong summer, despite inflation’s tightening effect on household budgets.
Covid Cancellations
EasyJet and full-service carrier British Airways have had to cancel flights over the Easter holiday period, with airports also contending with resource and staffing shortages.
While EasyJet expects crew members to return to work as the spike in Covid cases reduces, that hasn’t happened yet and infection levels remain high, Lundgren said. At some of the carrier’s bases, absence levels are as high as 20%, he said.
The other major challenge has been fuel prices, which have surged since the Russian invasion of Ukraine. EasyJet said it had hedged 64% of its fuel requirements for the six months ending in September at $571 per metric ton, about half of the market price.
