EasyJet profit soars 18% as passenger numbers grow

EasyJet posted an 18% rise in full year pre-tax profit as revenue and passenger numbers grew, and expressed confidence over the long-term outlook for the business.

For the year to the end of September, pre-tax profit came in at £686m from £581m, on revenue of £4.69bn, up 3.5% from 2014 and only slightly short of consensus. The profit figures were in line with the company’s updated guidance of £675m to £700m.

Earnings per share increased 21.5% to 139.1p, beating consensus forecasts of 137p.

Passengers increased by 6% to 68.6m, with a record load factor in August of 94.4% and an annual load factor of 91.5%, up 0.9 percentage points.

Total revenue per seat fell by 1.3% to £62.48, although it was up 1.5% at constant currency to £64.28.

The low-cost carrier said it will pay a dividend of 55.2p per share, up 21.6% from last year.

Chief executive Carolyn McCall said: “Our outlook for the longer term is positive. We expect demand in our markets to be sustained and for easyJet to continue to be a winner in its markets.

“We will see passenger growth of 7% a year, sustaining margins through rigorous cost control and the benefit of fleet up-gauging, resulting in positive profit momentum.

Shares in EasyJet were down 2.9% to 1,730.85p at 1020 GMT, with analysts pointing out that profit was closer to the lower end of guidance.

Atif Latif, director of trading at Guardian Stockbrokers, noted a degree of disappointment as some investors had been hoping for a special dividend to be announced.

Meanwhile, SpreadCo market analyst David Morrison said the selloff has much to do with Monday’s price action.

“Traders wanted to take the stock lower after the Paris attacks but held back because of today’s earnings release. Now that’s out of the way the stock can trade freely and there are fears of a price war hotting up. Ironically for EasyJet, it seems it’s better to travel than arrive,” he said.