EasyJet plays down effects of Paris after hitting record profit

EasyJet does not expect the Paris attacks to deter travellers. Picture: Julien Hekimian/Getty Images
EasyJet does not expect the Paris attacks to deter travellers. Picture: Julien Hekimian/Getty Images
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EasyJet revved up with its fifth straight year of record profits yesterday, while it said it believed the Paris terrorist attacks will have a minimal impact as “resilient” passengers will still want to travel.

Paul Moore, the budget airline’s communications director, said any disruption would be brief, adding that the group had not changed its growth forecasts for 2016.

“Obviously our thoughts are with those affected,” he said. “But we have dealt with such events before and it is typically a short-term impact.

“At the weekend we saw some passengers not wanting to fly, which is perfectly understandable, but longer term we do not see any material effect.

“People are resilient. Both in and out of Paris, people will ­continue to want to fly.”

Shares in easyJet dipped almost 4 per cent on Monday morning as investors expressed concerns over the impact of the terrorist attacks on the travel and leisure sectors. They fell a further 4.1 per cent yesterday.

Moore’s comments came as the firm yesterday posted bumper pre-tax profits of £686 million for the 12 months to the end of September, in line with its upgraded guidance and up 18.1 per cent on last year. Both earnings per share and the dividend have been bolstered by 22 per cent.

The firm also carried an additional four million passengers during the 12 month period to reach a total of 68.6 million.

EasyJet chief executive Carolyn McCall said the airline’s outlook for the longer term remained positive and she expects demand in its markets to be sustained.

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

“We remain totally focused on our network advantage, ­digital leadership and offering our ­customers great low fares and service.”

Commenting on the performance, Hargreaves Lansdown equities head Richard Hunter, said: “EasyJet continues to cruise, with a set of results which show improvement in its numbers almost without exception.

“Passenger numbers are also increasing, and the load factor remains in excess of 91 per cent as testament to the efficiency of the easyJet business model. The impressive performance has been achieved despite currency headwinds, the earlier French air traffic control strike and the fire in Rome during the year.”

But Damian Brewer of RBC Capital Markets said questions remain over its growth plans, saying: “We think easyJet still needs to answer how it will avoid margin dilution other than relying on cheaper fuel costs as it expands into new and likely more competitive markets.”