19th Feb 2025 09:00
(Alliance News) - Jet2 PLC on Wednesday said it is "pleased" with how its financial year is ending and is "satisfied" with early bookings for the key summer season; however it warned that UK holiday makers continue to book later than in the past and it faces rising costs.
Jet2 is a Leeds, England-based airline and package holiday operator.
It said it expects pretax profit before foreign exchange movements for the financial year ending March 31 of between GBP560 million and GBP570 million, an improvement of 8% and 10% on financial 2024. "This range excludes gains from asset disposals, including the ongoing sale of our recently retired Boeing 757-200 fleet, details of which will be provided in our April post-close trading update," it noted.
In its November half-year results, Jet2 predicted profit ahead of market expectations at the time of GBP541 million.
"Winter 2024/25 on sale capacity at 5.1 million seats is 14% higher than winter 2023/24 with the closer to departure, later booking profile experienced during summer 2024 having continued. Season to date booked average load factor is down by 2.2 percentage points, with the month of March and the later timing of Easter year-on-year contributing 1.3 percentage points of this decrease. Overall pricing for the season has remained competitive," Jet2 said.
Looking to the next financial year, Jet2 said capacity for summer 2025 is currently 8.5% higher than for summer 2024, at 18.6 million seats on sale. New bases at Bournemouth and London Luton airports in southern England are contributing about 4% of this growth at over 700,000 seats.
Jet2 said bookings at its two new bases are encouraging, but it said the average load factor at the new Luton airport base north of London "is materially lower than that of existing bases due to it only going on sale when operations were announced in November 2024".
Jet2 said it expects to take delivery of 14 more new owned and leased Airbus aircraft, upping its A321neo fleet to 23 by the end of summer 2025.
"Unfortunately, a number of these aircraft will be delayed from their agreed delivery dates and consequently we expect to incur additional operational costs to cover aircraft gaps in the peak summer flying programme. Nevertheless, we remain very pleased that the A321neo aircraft are already demonstrating their strategic value in terms of operating economics, reduced emissions and customer experience," the company said.
Jet2 also warned that it faces cost increases ahead of headline UK consumer price index inflation. These include higher wage and National Insurance costs following changes made in the recent UK government budget. It also faces higher costs for hotel accommodation, aircraft maintenance, and general airport and air traffic control charges.
As well, the mandated increase in sustainable aviation fuel in its aircraft fuel mix will result in more than GBP20 million of incremental costs, Jet2 said.
"We continue to believe that our customers cherish their time away from our rainy island, and want to be properly looked after throughout their holiday experience and we will continue to invest in our business to meet these expectations," said Chief Executive Officer Steve Heapy.
"However, we also recognise the current macro-economic conditions and the many demands placed on consumer discretionary incomes, which combined with the later booking profile and cost headwinds detailed, may mean profit margins in the year ahead come under some pressure."
Shares in Jet2 were down 9.4% to 1,418.00p early Wednesday in London, the biggest decliner in the AIM 100 index.
Jet2 said it will provide a further trading update in April and a fuller outlook on the summer 2025 holiday season with its full-year results on July 9.
By Tom Waite, Alliance News editor
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