TIDMEZJ
RNS Number : 7488N
easyJet PLC
25 January 2023
25 January 2023
easyJet plc
('easyJet')
easyJet Trading Update for the quarter ended 31 December
2022
Strong bookings see easyJet improve its first quarter
performance by GBP80 million year on year, driven by its
transformed network and much improved revenue capability with
momentum continuing into Q2
-- Q1 headline loss before tax GBP133 million (Q1 22 GBP213 million loss)
o Passenger growth +47% YoY
o RPS +36% YoY
-- Load factor +10 ppts YoY
-- Ticket yield +21% YoY
-- Ancillaries continue to grow with yield increasing 20% YoY
(+85% vs Q1 FY19)
o easyJet holidays delivers GBP13 million profit (Q1 22 GBP1
million loss)
-- Strong booking momentum:
o Q2 RPS expected to continue year on year trend from Q1
o Airline and easyJet holidays deliver record revenue booking
days in January
o Bookings strength continues across Q2 and into summer 2023
-- easyJet holidays upgrades expectations from >30% to c.50%
customer growth YoY
-- Strong UK demand: 11 new routes just released to popular
holiday destinations
-- Expect H1 loss before tax to be significantly better vs H1 22
-- H2 ticket yields continuing the trend from H1, although load
factors behind FY19 levels as later booking pattern continues
-- Whilst we remain mindful of the uncertain macroeconomic
outlook across the globe, based on current high levels of demand
and strong bookings, easyJet anticipates beating the current market
profit expectations(1) for FY23
Summary
easyJet's first quarter financial performance was ahead of
expectations as yields strengthened, with revenue per seat
increasing 36% year on year. Airline ancillary revenue continued to
perform well, at GBP20.12 per seat, also increasing 36% year on
year. easyJet holidays remains the UKs fastest growing major
holiday company, with a 161% increase year on year in customers as
demand for travel in the UK remains strong.
Moving into the second quarter of this financial year, easyJet
expects RPS growth year on year to continue the trend experienced
in Q1. This is driven by yield and load factor growth alongside the
continued delivery of ancillary products. easyJet holidays will
continue to see customer growth through the quarter, alongside
investment into marketing and advertising as part of the turn of
year sale campaign.
easyJet's leading low-cost proposition at primary airports
provides a key differentiator for customers making it easy to
travel, whilst offering great value. Demand for our network is
strong demonstrated through record turn of year bookings. Easter,
which sits in Q3, is currently trading very well with sold ticket
yields +24% vs FY19, noting the later booking window. With strong
UK demand, easyJet holidays is now over 60% sold for this summer,
based on the previously guided 30% growth year on year. With the
holidays business not constrained and considering current levels of
demand, we now expect to see growth of circa 50% on FY22.
Johan Lundgren, CEO of easyJet, said:
"We have seen strong and sustained demand for travel over the
first quarter, carrying almost 50% more customers compared with
last year. Many returned to make bookings during the traditional
turn of year sale where we filled five aircraft every minute in the
peak hours, which culminated in three record-breaking weekends for
sales revenue this month.
"This strong booking performance, aided by the airline's step
changed revenue capability, has driven an GBP80m year on year boost
in the first quarter with continued momentum as customers
prioritise spending on holidays for the year ahead. easyJet
holidays, the fastest growing holidays company in the UK, is
upgrading its ambitious growth plans for the year given the strong
demand.
"In summary, we expect to see our winter loss reduce
significantly over the first half compared to last year. This will
set us firmly on the path to delivering a full year profit, where
we anticipate beating the current market expectation enabling us to
create value for customers, investors and the economies we
serve."
Capacity
During Q1 easyJet flew 20.2 million seats, in line with
guidance, a significant increase on the same period last year when
easyJet flew 15.5 million seats. Load factor was 87% (Q1 FY22:
77%), due to increased customer demand coupled with
restriction-free travel.
Passenger(3) numbers in the quarter increased to 17.5 million
(Q1 FY22: 11.9 million).
October November December Q1 Q1
2022 2022 2022 FY23 FY22
Number of flights 49,071 28,907 34,914 112,892 85,618
-------- --------- --------- -------- -------
Peak operating aircraft 313 254 261 313 251
-------- --------- --------- -------- -------
Passengers (3) (thousand) 7,505 4,543 5,433 17,481 11,891
-------- --------- --------- -------- -------
Seats flown (thousand) 8,732 5,178 6,250 20,159 15,471
-------- --------- --------- -------- -------
Load factor (4) 86% 88% 87% 87% 77%
-------- --------- --------- -------- -------
Sustainability
During the quarter, easyJet's CO2 emissions per RPK reduced 11%
year on year. Alongside this, our partnership with Rolls-Royce set
a new aviation milestone with the world's first run of a modern
aeroplane engine fuelled by green hydrogen. To further underpin the
commitment to achieving our net zero roadmap, easyJet announced a
partnership with Airbus, Bristol Airport and EDF Hynamics, with the
objective of turning Bristol Airport into a hydrogen hub.
Revenue, Cost and Liquidity
Revenue continued to benefit from strong demand for easyJet's
leading network, the continued outperformance of ancillary products
and easyJet holidays. Significant fuel price increases year on year
and the strengthened USD have resulted in fuel cost per seat being
76% (GBP8.44) more than the same period last year. One-off costs
were incurred during the quarter as 15 wet leased aircraft utilised
in summer 22 left the fleet at the end of October.
Financing costs benefitted from the strengthening of sterling
versus the USD over the quarter which has driven a non-operating,
non-cash FX gain of GBP13 million (Q1 FY22: GBP15 million gain)
from balance sheet revaluations.
Q1'23 Q1'22 Variance
Passenger revenue (GBP'm) 975 547 78%
-------- -------- ---------
Airline ancillary revenue (GBP'm) 406 230 77%
-------- -------- ---------
Holidays revenue(2) (GBP'm) 93 28 232%
-------- -------- ---------
Group revenue (GBP'm) 1,474 805 83%
-------- -------- ---------
Fuel costs (GBP'm) (393) (171) (130)%
-------- -------- ---------
Airline headline EBITDAR costs (GBP'm) (959) (647) (48)%
-------- -------- ---------
Holidays EBITDAR costs(2) (GBP'm) (80) (29) (176)%
-------- -------- ---------
Group headline EBITDAR costs (GBP'm) (1,432) (847) (69)%
-------- -------- ---------
Group headline EBITDAR (GBP'm) 42 (42) 200%
-------- -------- ---------
Group depreciation & amortisation
(GBP'm) (164) (153) (7)%
-------- -------- ---------
Group LBIT (GBP'm) (122) (195) 37%
-------- -------- ---------
Financing costs excluding balance
sheet revaluations (GBP'm) (24) (33) 27%
-------- -------- ---------
Balance sheet revaluations (GBP'm) 13 15 (13)%
-------- -------- ---------
Group headline LBT (GBP'm) (133) (213) 38%
-------- -------- ---------
Airline passenger revenue per seat
(GBP) 48.35 35.37 37%
-------- -------- ---------
Airline ancillary revenue per seat
(GBP) 20.12 14.84 36%
-------- -------- ---------
Total airline revenue per seat
(GBP) 68.47 50.21 36%
-------- -------- ---------
Airline headline cost per seat ex
fuel (GBP) (56.21) (52.90) (6)%
-------- -------- ---------
Airline fuel cost per seat (GBP) (19.50) (11.06) (76)%
-------- -------- ---------
Airline headline total cost per
seat (GBP) (75.71) (63.96) (18)%
-------- -------- ---------
Cash and money market deposits (GBP'bn) 3.0 2.9 3%
-------- -------- ---------
Net debt (GBP'bn) 1.1 1.2 8%
-------- -------- ---------
Capacity outlook
o H1 c.38m seats, c.25% increase YoY
o H2 c.56m seats, c.9% increase YoY
o Q4 capacity around pre-pandemic levels
Fuel & FX Hedging
Jet Fuel H1'23 H2'23 USD H1'23 H2'23
Hedged position 78% 59% Hedged position 75% 62%
----- ----- ----- -----
Average hedged rate
($/MT) $819 $900 Average hedged rate (USD/GBP) 1.29 1.24
----- ----- ----- -----
Current spot ($/MT)
at 24.01.23 c. $1,110 Current spot (USD/GBP) at 24.01.23 c. 1.23
------------ ------------
For further details please contact easyJet plc :
Institutional investors and analysts:
Michael Barker Investor Relations +44 (0) 7985 890 939
Adrian Talbot Investor Relations +44 (0) 7971 592 373
Media:
Anna Knowles Corporate Communications +44 (0) 7985 873 313
Edward Simpkins FGS Global +44 (0) 7947 740 551 / (0) 207 251
3801
Dorothy Burwell FGS Global +44 (0) 7733 294 930 / (0) 207 251
3801
A copy of this Trading Statement is available at
http://corporate.easyjet.com/investors
1 ) Current market profit expectations for FY23 is a GBP126
million profit before tax for FY23.
2) easyJet holidays numbers include elimination of intercompany
airline transactions
3) Represents the number of earned seats flown. Earned seats
include seats which are flown whether or not the passenger turns
up, as easyJet is a no refund airline and once a flight has
departed, a no-show customer is generally not entitled to change
flights or seek a refund. Earned seats also include seats provided
for promotional purposes and to staff for business travel.
4) Represents the number of passengers as a proportion of the
number of seats available for passengers. No weighting of the load
factor is carried out to recognise the effect of varying flight (or
"sector") lengths.
This announcement may contain statements which constitute
'forward-looking statements'. Although easyJet believes that the
expectations reflected in these forward-looking statements are
reasonable, it can give no assurance that these expectations will
prove to have been correct. Because these statements involve risks
and uncertainties, actual results may differ materially from those
expressed or implied by these forward-looking statements.
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END
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January 25, 2023 02:00 ET (07:00 GMT)
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