EasyJet Looks for a Winter Boost After Predicting $1.5 Billion Annual Loss

EasyJet said travel was back as it increased capacity for October-December to 70 percent of its pre-pandemic level, a turnaround from a year in which Covid-19 restrictions drove losses above $1.36 billion.

Demand for holidays to winter sun destinations such as Egypt and Turkey was growing, said easyJet, which will fly more to the Canary Islands in October than it did in 2019. It was also seeing more bookings from business travellers.

“It is clear recovery is underway,” CEO Johan Lundgren said on Tuesday.

Pandemic uncertainty and travel bans pushed easyJet to an expected headline loss of between $1.54 billion and $1.6 billion for the 12 months ended September, it said.

In the best case scenario, that means the airline will beat a consensus forecast for a loss of $1.6 billion. The results will be on Nov. 30.

Seeking to boost its recovery from the pandemic, easyJet in September launched a surprise $1.63 billion rights issue and also revealed it had rejected an “opportunistic” bid from a suitor, believed to be Wizz Air.

But easyJet cautioned that visibility remained limited as customers were booking closer to their travel date, meaning it could not provide guidance for 2022. It is not recommending a dividend for 2021.

A big exposure to the UK market where the government kept stricter travel rules for longer compared to the rest of Europe, had over the summer slowed down easyJet’s recovery relative to some peers such as Ryanair.

But Britain has recently relaxed those rules, scrapping some tests and its frequently changing traffic light system which deterred bookings. EasyJet said that the recent changes were helping booking momentum.

Shares in easyJet have rise 10 percent over the last month.

(Reporting by Sarah Young, Editing by Paul Sandle/Guy Faulconbridge)

This article was written by Sarah Young from Reuters and was legally licensed through the Industry Dive publisher network. Please direct all licensing questions to [email protected].