easyJet warns of wider losses in 1H |
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Thu, 23 Feb 2006 17:05
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LONDON: Britain's budget airline easyJet Plc. has forecast a wider first half loss for the current fiscal as a result of rising fuel costs. However, it maintained its full year forecast of higher profits as it hoped non-ticket revenues and cost trimmings will help it to increase profitability.
The company said the ever-increasing oil prices and the timing of Easter would hit its first half, where losses would double to 45 million pounds from 22 million pounds a year ago. The 50 per cent rise in fuel costs led to an additional charge of 55 million pounds during the period, the company said. And Easter this year falls in the second half of the company's fiscal.
The Luton-based carrier has 50 per cent of its fuel hedged at $590 to $660 per tonne in the first half, giving it some relief from the price rise.
It said its carrying capacity will go up 15 per cent and profits by a mid to high single-digit percentage for the full year. Cost controls will bring in a 3 to 5 per cent fall in the cost per seat.
Sir Colin Chandler, chairman, told the company's AGM that, "Overall, we plan to achieve mid to high single-digit percentage profit growth in the current financial year."
For the fiscal ended September 2005, the company had made pretax profit of 82.6 million pounds under the new IFRS accounting rules.
easyJet operates 212 routes to 64 airports. It has witnessed growth in its new bases like Berlin, Basel and Dortmund.
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