EasyJet Plc reported an increased full-year pre-tax profit as Europes second largest budget airline benefited from strikes at rival carriers.
The British company stated a 21.5% increase in pre-tax profit for the year ended September 30 to £581 million, slightly above the companys projection of £580 million.
Revenue for the period increased 6.3% to £4.53 billion, as Air France contributed to the number with its canceled flights in September due to a strike by its pilots. EasyJet said revenue per seat increased 1.2% or 1.9% on constant currency basis, thanks to a number of digital and revenue management initiatives and a continued focus on capital allocation.
The company also reported that 62% of all business passengers who flew with EasyJet returned to fly again. Holiday travelers who made repeated bookings increased from 50% to 57%.
Load factor, the percentage of sold seats per kilometer, rose 1.3 points to 90.6%, while passengers numbers climbed 6.6% to 64.8 million.
“Popular new initiatives like allocated seating meant many people tried us for the first time and we are absolutely focused on driving loyalty so they choose us flight after flight,” said CEO Carolyn McCall.
EasyJet introduced a frequent flyer loyalty program targeted at customers flying for the first time, who are roughly 15 000. The benefits of the program include dedicated phone number, price guarantee and flexible bookings. After three months of trials Ms McCall said the program is working well.
The air carrier stated £32 million of saving through the year, including £18 million in the second half. Excluding fuel, cost per seat decreased 1.2% to £37.70.
“Our performance demonstrates our continued focus on cost and progress against every strategic revenue priority.” said Ms McCall.
EasyJet opened new bases in Hamburg and Naples during the year, and announced its plans to start operating facilities in Amsterdam and Porto. The company also said it exercised its option right over 35 fuel-efficient Airbus A320 planes to take advantage of profitable growth opportunities.
Capital employed increased 3.1 points to 20.5%, which combined with lower fuel spendings, cost cuts and and increased number of passengers helped profit to grow faster then revenue.
Net profit rose to £450 million with earnings per share of 114.5 pence, up 13.0% from last years 101.3 pence.
EasyJet Plc fell 0.39% on Monday and closed at GBX 1 544 in London. On Tuesday the stock dropped 1.1% to trade at GBX 1,527 at 10:05 GMT, marking a one-year increase of 24.68%. The company is valued at £6.13 billion. According to the Financial Times, the 22 analysts offering 12-month price targets for EasyJet Plc have a median target of GBX 1 723.5, with a high estimate of GBX 2 160 and a low estimate of GBX 1 275. The median estimate represents a 11.63% increase from the last close price of GBX 1 544.
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