EasyJet increases number of flights but reveals negative impact of last minute bookings
2 years ago
EasyJet has said it expects to fly around 60% of its pre-pandemic programme over the peak holiday season, but revealed last-minute bookings mean fewer than half its summer flights have been sold.
The low cost carrier’s capacity for the July to September quarter marks a sharp increase after it flew just 17% of 2019 levels in the previous three months.
It said the reopening of travel in continental Europe and easing of restrictions for the fully vaccinated in the UK will drive a marked rebound in demand in its fourth quarter to September 30.
But the trend for customers to leave bookings until the last minute means its flights are just 44% sold for July to September, down from 69% in the same quarter of 2019.
EasyJet added that it is also heavily focusing its schedule on continental European routes, with Europe having reopened its travel faster than the UK.
Two-thirds of its bookings are now coming from Europe as a result, compared with the usual 50-50 split.
Chief executive Johan Lundgren said there was a risk the UK would be left in the slow lane if it does not ease up travel restrictions in line with European neighbours.
He said: “The UK is being left behind.
“The rest of Europe is opening up and unwinding.”
Holland has already seen airline travel rebound above pre-pandemic levels after opening up, according to easyJet.
Mr Lundgren added the UK’s rules for travel, as well as “expensive and unnecessary testing” for low risk destinations “just doesn’t make sense”.
“You can go into a very crowded nightclub with no face mask and with no vaccination, but you can’t lie on a beach in Europe,” he said.
But the group saw weekly bookings surge five-fold after the UK government announced on July 8 that fully vaccinated passengers will be able to fly back from so-called amber list countries without quarantine.
The carrier is boosting flights to 74 countries on the amber list, such as Spain, Greece, Portugal and Cyprus, to meet the jump in demand.
EasyJet’s trading update for the three months to June 30 showed it narrowed headline pre-tax losses by 8.2% to £318.3 million, which was in line with its expectations, as cost-cutting helped limit the ongoing hit from the pandemic.
It saw passenger numbers rise to three million in the three months to June 30 against a lockdown-hit third quarter a year earlier, when its fleet had been grounded for all but two weeks, flying just 117,000 seats.
Revenues in the latest quarter rose to £212.9 million from just £7.2 million a year ago.
The group said its cash burn was reduced to £55 million, with cost-cutting on track to deliver around £500 million of savings over the full year.
It also paid out a further £122 million of customer refunds in the quarter, taking its total refund bill to £1.2 billion so far during the pandemic.
Mr Lundgren said: “During this quarter we have successfully managed through the continued challenges of the pandemic, using our operational responsiveness to capture demand while focusing on cost control and minimising cash burn.
“So, while we know the road to recovery from the pandemic isn’t going to be a straight line, we are ready to compete using these new-found strengths with everything we have learned.”