British low-cost airline easyJet lifted its annual profit guidance above analysts forecasts after it benefited from strong summer travel, lower than expected fuel costs, favourable currency moves and a strike at a rival airline.
The company said it now expected to report a pretax profit in the range of £575 million to £580 million, compared with the £545 million to £570 million level which it set at the time of its third-quarter results in July.
Before today’s update the consensus forecast was for a pretax profit of £566 million pounds for the year through September.
The company is due to report full-year results on November 18th. EasyJet said its unit fuel costs in the six months to September would be £2 million lower than in the corresponding period last year, while exchange rate movements would be favourable by about £15 million.
At current rates, easyJet also said it expected the fuel bill for its next financial year to be about 50 million pounds lower than this year, but adverse currency moves over the same period could have a £20 million adverse impact.
Earnings were helped by strong demand for short-haul European travel at the end of the summer, meaning its revenue per seat on a constant-currency basis would be 1.5 per cent higher than last year in its fiscal fourth quarter.
A strike by pilots at Air France, part of Air France-KLM , is expected to have added £5 million pounds to easyJet’s revenue as customers switched to its planes, the company said.
The airline’s low-fares model has helped it and budget rival Ryanair weather an increasingly competitive European short-haul market.
Reuters