Fuel costs blamed for Easyjet losses

Low-cost airline easyJet today said half-year losses hit £129.8m (€146.67m) following a £90m (€101.7m) increase in fuel costs.

Despite the doubling in the deficit for its weaker trading period, UK-based easyJet said it remained on course to make a profit in the full year.

It drew encouragement from growth in revenues per seat of 14.9%, with passenger numbers up by 2.9% to 19.4 million in the period.

EasyJet also said fuel costs, which increased by £3.87 (€4.37) per seat in the half year, were expected to unwind as fuel hedging policies adjust to lower market prices.

The movement of Easter into the second half of the financial year also depressed profit margins for the opening six months.

Chief executive Andy Harrison said: “While we remain cautious about the consumer economy, at current fuel prices and exchange rates, easyJet expects to be profitable for the full year.”

The airline currently operates a fleet of 173 aircraft, operating out of 19 bases. For the first time, over half of easyJet’s passengers originated outside the UK, with 21.8% growth in passenger numbers on European-based routes.

EasyJet said second half bookings were broadly in line with last year, with 40% of the summer period now booked. It added it was too early to assess any potential impact on its business from the outbreak of swine flu.