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EasyJet has revealed its results for the year ended 30 September 2024, recording a substantial rise in profit, boosted by robust summer travel demand.
ADVERTISEMENTBritish low-cost airline giant easyJet announced its financial year 2024 results for the 12 months ended 30 September 2024 on Wednesday and said headline profit before tax soared 34% year-on-year to £610m (€731.14m). It was mainly boosted by record summer travel numbers.
EasyJet holidays’ profit before tax also jumped 56% year-on-year to £190m (€227.73m).
EasyJet shares were up 0.22% on Wednesday morning following the financial update.
The group headline profit before tax per seat also increased 24% on a year-on-year basis, hitting £6.08 (€7.29) per seat, thus inching closer to the company’s target of £7-£10 (€8.39-€11.98) per seat.
Passenger numbers also rose 7% year-on-year in the second half of the year.
The company also shared an optimistic outlook for the financial year 2025, estimating that FY25’s seat capacity would inch up 3%, to touch about 103 million seats. EasyJet also expects to slash winter losses, mainly through a substantial uptick in performance expected in the first quarter of 2025.
However, the second quarter of next year is expected to be somewhat dampened, due to Easter.
EasyJet’s current CEO, Johan Lundgren, has also announced that he would be stepping down at the beginning of next year, after seven years leading the company. He will be replaced by EasyJet’s current chief financial officer (CFO), Kenton Jarvis.
Lundgren said in the FY2024 earnings statementon the company’s website: “This strong performance-resulting in a 34% increase in our annual profits – reflects the effectiveness and execution of our strategy as well as continued popularity of our flights and holidays.
“It also represents a significant step towards our goal of sustainably generating over £1 billion annual profit before tax. I am pleased to be leaving a strong easyJet, the future for the company is bright and I look forward to seeing Kenton delivering his ambitious plans, generating positive shareholder returns while making low-cost travel easy for millions of customers.”
Jarvis also said in the statement: “The outlook for easyJet is positive and travel remains a firm priority with consumers who value our low fares, unrivalled network and friendly service.
“The airline will continue to grow, particularly on popular longer leisure routes like North Africa and the Canaries and we plan to take 25% more customers away on package holidays, easyJet holidays continues to thrive.”
EasyJet continues to profit from rise in cost-conscious flyers
Richard Hunter, head of markets at Interactive Investor, said in an email note: “It seems that the launch of the holidays unit has come at the right time with cost-conscious consumers searching for value packages, and the group has high hopes for the unit’s longer-term contribution to overall profits.
“This also chimes with the group’s value-conscious appeal and the increasing body of evidence which tends to suggest that the family holiday remains almost sacrosanct and outside of normal budgetary restraints, which has played into the hands of easyJet and its keenly priced offerings of flights and holiday packages.
“Its network of destinations are usually convenient and difficult for some of its competitors to mirror, while the group has also managed to keep a relative lid on its prices.”
ADVERTISEMENTDan Coatsworth, investment analyst at AJ Bell, also said in an email note: “Results from easyJet offer the latest evidence that a week in the sun remains a non-negotiable for many people.
“One of Lundgren’s strategic initiatives – the big expansion into package holidays – is paying off and his successor, Kenton Jarvis, will be looking to build on this success. The market share gains made by this part of the business suggests the easyJet brand has real clout with holidaymakers.
However, the sailing, or in this case, flying, may not be entirely smooth, with Coatsworth pointing out that hurdles still remain.
He continued: “Jarvis still has a challenge on his hands to steer the company towards some ambitious medium-term profit targets and it’s fair to expect some turbulence along the way given the wider supply chain issues in the sector and exposure to volatile fuel prices.
ADVERTISEMENT“However, easyJet is in much better shape than it was a few years ago and that’s reflected in a big uplift in the dividend which signals confidence in its future trajectory.”
