January 22, 2009 / 7:33 AM / 12 years ago

UPDATE 3-EasyJet sees better H1 as Air France stutters

* EasyJet sees revenue growth/passenger mid-single digits

* EasyJet still sees profitable 2009

* Stelios welcomes Q1 to Dec performance

* Air France makes 200 mln euro Q3 loss

* EasyJet shares up 11 pct, Air France up 1.8 pct

(Adds Stelios, analyst comment, updates shares)

By John Bowker

LONDON, Jan 22 (Reuters) - Britain’s easyJet (EZJ.L) said on Thursday first-half revenues were likely to come in better than expected partly due to a rise in business traveller numbers, sending its shares soaring.

Chief Executive Andy Harrison told Reuters he expected revenue growth per passenger to climb at a mid-single digit percentage rate over the six months to end March, up from earlier forecasts of low single digits.

“We see a huge amount of economic uncertainty ahead — we’ll see how the business trades over the summer — but we are currently performing better than expected,” the head of the low-cost carrier said in a telephone interview.

“There has been a clear flight to value and we fly to primary airports, so there has been a significant increase in business passengers,” he added.

EasyJet shares, down by more than a third over the past year, were up 11.3 percent at 284 pence by 0945 GMT, valuing the business at 1.2 billion pounds ($1.66 billion)

The news contrasted sharply with recent statements from rival European airlines. Air France-KLM (AIRF.PA), Europe’s biggest airline, said late on Wednesday it would make an operating loss of 200 million euros ($259.8 million) in its third quarter due to the worsening economy — its second profit warning in three months.

Air France shares rose 1.8 percent.


Harrison said easyJet had taken 10 percent of summer bookings to date, in line with this time last year and at similar prices.

But he warned it was too early to say what the end result for the crucial period would be due to the economic climate and sharp falls in the value of the pound.

“There is a huge amount of uncertainty... It’s too early to be adjusting profit forecasts,” he said, reiterating that the airline would be profitable in the year to end September.

EasyJet posted revenues up 32 percent at 550 million pounds ($762.6 million) in the three months to end December.

“EasyJet’s Q1 makes for very encouraging reading ... the short term consensus numbers are likely to increase,” Numis analyst Wyn Ellis says in a note, putting his recommendation under review.


EasyJet last year became embroiled in a boardroom row with founder and non-executive director Stelios Haji-Iannou over future growth strategy, but the high profile controller of the ‘easy’ brand said on Thursday he was happy with the results.

“I’m pleased to see the business performed so well in revenue terms in the last quarter ... The management clearly recognises the potential downside of the current economic environment,” he said in a statement.

The argument had centred on new plane orders, and on Thursday easyJet repeated its intention to grow the fleet as planned but said it would review the policy every quarter — a position that appeared to satisfy Stelios.

“Maintaining a flexible approach to the future size of the aircraft fleet over and above the 170 aircraft we have today will be key to continuing this good performance,” the entrepreneur said.

EasyJet plans to have 197 aircraft by September 2011, up from 165 last September, due to a long-standing order with Airbus EADS.PA.

Stelios also wants the airline to start paying a dividend to shareholders but Harrison said that would be inappropriate at this time. ($1=.7212 Pound) ($1=.7697 Euro) (Editing by Mike Nesbit, Hans Peters, John Stonestreet)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below