EasyJet swings to annual profit, but expects to be affected by Gaza conflict

Underlying, or headline, profits stood at £455m against a £178m loss in 2021-22.

A record-breaking performance over its second half and the peak summer season helped it shrug off a 30 per cent jump in its costs, with its fuel bill soaring by 59 per cent to £2bn over the year.

It said it does not expect to narrow losses in the first quarter of its new financial year as flights and wider demand are impacted by the conflict in Gaza.

Its flights to Israel and Jordan are temporarily paused, with Egypt also seeing a knock-on effect – altogether representing a combined 4 per cent of its overall flight programme.

EasyJet said: “Additionally there was a broader impact on near-term flight searches and bookings across the industry, though this seems to be coming back with a recent improvement in trading.

“Accordingly, despite positive underlying strength, easyJet does not currently expect its first quarter loss to improve year on year.”

Despite the woes in the Middle East, easyJet said the outlook for the new year as a whole was “positive” thanks to strong bookings for next summer and supply constraints in Europe.

The group resumed its dividends with a 4.5p a share payout due in early 2024 and confirmed it expects to increase this to 20 per cent of profit after tax.

EasyJet saw a 19 per cent rise in the numbers of passengers flown over the year, to 82.8 million, as demand bounced back in the first full year with no Covid travel restrictions since 2019.

It notched up its highest-ever underlying earnings in its final quarter, with revenues of more than £1bn in July and August for the first time.

This was also helped by higher air fares as well as greater revenues from extras added on to tickets.

The group said this was continuing into the new financial year, with revenues per seat 12 per cent higher in October and expected to be higher throughout the year.

EasyJet said the performance was delivered despite disruption from air traffic control (ATC) strikes, as well as the UK ATC system glitch at the end of August.

It said that in March alone only five days were unaffected by strike action.

Johan Lundgren, easyJet’s chief executive, said: “We see a positive outlook for this year with airline and holidays bookings both ahead year on year and recent consumer research highlights that around three-quarters of Britons plan to spend more on their holidays versus last year with travel continuing to be the top priority for household discretionary spending.”