EasyJet expects annual profits to be higher than expected due to increased revenue

Passenger numbers reached 15.6m during the first three months of the year, up by more than a third from 11.6m during the same period in 2022.

EasyJet said it expects to outperform market expectations of a profit before tax of £260m for the year to the end of September.

Responding to the financial update, easyJet chief executive Johan Lundgren said: “Demand for easyJet’s flights and holidays has continued to grow in the half, resulting in more than a £120million pound improvement in our performance as well as a billion pound revenue improvement year-on-year.

“This is further enhanced by our transformed network of popular destinations and improved revenue capability.

“We see continued strong booking momentum into summer as customers prioritise spending on travel and choose airlines like easyJet offering the best value and destination mix, as well as easyJet Holidays which is continuing its steep growth trajectory as the fastest growing holidays company in the UK.

He added: “All of this means easyJet expects to outperform FY23 market expectations.”

Richard Hunter, the Head of Markets at interactive investor, commented in response to the announcement: “easyJet has continued its flight back towards financial safety after a strong Easter showing and the promise of a busy summer period to come.

"The company remains upbeat both on current and summer trading, with a return to profitability being a strong likelihood based on the present estimates.

"More broadly, the challenges of a stalling UK economy could transfer to customer propensity to spend, but while easyJet is not at the extreme discount end of the market, it remains appealing to the main market and easyJet Holidays is showing signs of adding another dimension.

“As with the group itself, the share price is showing signs of recovery but still has some way to go.

"Despite a hike of 57 per cent over the last six months, the shares are still down by 11 per cent over the last year, as compared to a decline of 8 per cent for the wider FTSE250.”

Mr Hunter added: “Leading in to the pandemic, the shares traded at almost £13 and have declined by 60 per cent from those levels. Even so, some of the clouds are beginning to clear and the recently upgraded market consensus of the shares to a cautious buy reflects a growing optimism.”