EasyJet expects annual profit growth of at least 14%

Thursday 24 July 2014 08.14
EasyJet's low-cost model has helped it to grow despite difficulties in the aviation industry
EasyJet's low-cost model has helped it to grow despite difficulties in the aviation industry

EasyJet said it would grow annual profit by at least 14% assuming no further significant disruption over the next two months, putting it on track to meet analyst expectations.

The company forecast that pre-tax profits for the 12 months to the end of September would be in the range of £545m ($928m) to £570m and the range included the impact from situations in Israel, Egypt and Moscow.

Analyst forecasts expect easyJet to report pre-tax profit of £569m for the current financial year according to Thomson Reuters data.

The airline's low fare model has helped it and low-cost rival Ryanair weather the impact of an increasingly competitive European short haul market, while higher cost carriers have struggled.

Air France-KLM, Europe's second-largest traditional network carrier warned earlier this month that its 2014 profit could be as much as 12% lower than previously predicted, mainly due to overcapacity and resulting weak prices.

Lufthansa last month cut back its profit targets for the next two years, citing competition with low-cost rivals as one of the factors.

EasyJet was one of a number of airlines which yesterday suspended flights to Tel Aviv's Ben Gurion Airport after it was targeted by Palestinian rockets. 

Flights were also suspended today and the airline said it was reviewing its operations in the country on a day by day basis.

Calling its third quarter performance solid, easyJet said it grew revenue by 8.6% to £1.2bn in the period, having added capacity of 6.8%.

It said cost per seat, excluding fuel and currency movements, was 1.3% lower than the year earlier period, beating earlier guidance of a 2% rise for the second half of the year.