EasyJet Plc full-year earnings declined at least 17 percent as a glut in capacity weighed on fares at Europe’s second-biggest discount carrier.
Pretax profit for the 12 months ended Sept. 30 was between 405 million pound and 410 million pounds ($530 million-$537 million), Luton, England-based EasyJet said in a statement Friday. The company had previously said the figure would be in the range of 380 million pounds to 420 million pounds.
EasyJet has been battling for market share after low oil prices encouraged carriers to splurge on seating, fueling a fare war that’s led to the insolvency of three major European operators since May. Revenue per seat, a measure of prices, declined 1.4 percent in the second half, slightly less than the 2 percent slide previously forecast, the low-cost operator said.
Exchange rate movements including a slump in the pound following last year’s U.K. vote to quit the European Union are expected to have had an adverse impact of about 100 million on earnings compared to fiscal 2016.
Prices delayed by at least 15 minutes.
“The market continues to be challenging and EasyJet has had to absorb a significant currency impact,” Chief Executive Officer Carolyn McCall, who is set to leave at the end of 2017, said in a statement, while adding that the carrier “has finished the year with continued positive momentum.”
McCall added that “current turmoil” in the sector - which this week saw the collapse of Britain’s Monarch Airlines Ltd., following on the heels of bankruptcy filings at Air Berlin Plc and Alitalia SpA - provides EasyJet with opportunities to “grow and strengthen our positions in Europe’s leading airports.”
Analysts had anticipated a full-year pretax profit of of 402.5 million pounds, the average of 19 estimates compiled by Bloomberg, versus last year’s reported figure of 495 million pounds.
©2017 Bloomberg L.P. This article was written by Thomas Seal from Bloomberg and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to firstname.lastname@example.org.
Free Newsroom email alerts
Register for daily/weekly email alerts with news from The Financial Times, Forbes, Reuters, The Economist and more.