7th Nov 2024 12:19
(Alliance News) - Wizz Air Holdings PLC on Thursday reported lower profit in the first half of its financial year, with revenue remaining nearly unchanged despite an increase in passenger numbers.
The Budapest-based budget carrier said pretax profit was EUR363.0 million in the six months that ended September 30, down 19% from EUR450.2 million a year before.
Revenue edged up just 0.5% to EUR3.07 billion from EUR3.05 billion a year before, while operating expenses increased by 7.4% to EUR2.72 billion from EUR2.53 billion.
Earnings before interest, tax, depreciation and amortisation declined 5.9% at EUR826.0 million from EUR878.1 million a year ago.
Wizz blamed the earnings decline on the grounding of aircraft due to ongoing inspections of Pratt & Whitney's geared turbofan engines, which began in September 2023 following the discovery of manufacturing issues.
Wizz Air said that the cost of one-off wet leased aircraft during the summer peak period was not fully offset by Pratt & Whitney's compensation for the plane groundings. Wizz Air expects that between 40 and 45 aircraft will be grounded over the next 18 months, and it is negotiating a new compensation scheme with Pratt & Whitney.
Chief Executive Officer Jozsef Varadi said: "Wizz Air has delivered a resilient performance in the first half, driven by solid air travel demand and strong focus on operational efficiency. We have continued our efforts to protect capacity in the face of engine-related groundings."
Varadi added: "Bookings since the period end show no softening of demand, and we are anticipating a positive momentum into the second half in terms of both bookings and yield, notwithstanding the volatile geopolitical situation in the Middle East."
From April to September, Wizz Air carried 33.3 million passengers, an increase of 300,000 compared to the same period in 2023.
Wizz Air pays no dividend.
Wizz Air shares were up 2.0% to 1,410.00 pence in London on Thursday morning.
By Eva Castanedo, Alliance News reporter
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