Jet2 expects to suffer annual losses of between £375 million and £385 million due to the Covid crisis.
The Jet2.com and Jet2holidays group achieved a profit of £264.2 million in the previous financial year.
The expected losses for the year ending March 31 came in a trading update today.
The company said it took “swift and decisive action” during the period to raise almost £1 billion from a range of funding sources to mitigate the impacts of the pandemic.
The business also undertook many internal actions to reduce cash burn and preserve cash.
As a result, the group reported a strong liquidity position comprising total cash of £1.379 billion and “own cash” excluding advance customer deposits of £1.062 billion, a year-on-year increase of 104%.
This was after promptly returning over £1.3 billion of customers’ deposits for cancelled flights and holidays.
Looking forward, the company said: “The continuing successful rollout of vaccines in the UK and the increasing momentum in Europe are both encouraging.
“Additionally, on 9 April, we welcomed confirmation from the UK government’s Global Travel Task Force that international travel remained on track to reopen in mid-May.
“However, we were disappointed at the lack of clarity contained in the task force’s report, in particular the as yet to be populated ‘traffic light’ framework for destinations, and full details and cost of the associated testing regime.
“This means the impact and duration of the proposed Covid-19 travel restrictions for summer ‘21 remain difficult to determine and due to this continued uncertainty, in fairness to all our stakeholders and especially our customers, we took the difficult decision to extend the suspension of our flights and holidays from 17 May up to and including 23 June, by which time we are expecting more clarity.”
The company added: “Unsurprisingly given the short-term uncertainty, customers are booking significantly closer to departure for summer ‘21.
“However, we continue to be encouraged by the volume of customer bookings for both winter ’21-‘22 and for summer ‘22, for which package holiday bookings are displaying a materially higher mix of the total.
‘Based on this limited visibility, we are confident that once normality returns, our customers will be determined to enjoy the wonderful experience of a well-deserved Jet2 holiday and that Jet2.com and Jet2holidays will continue to have a thriving future, taking millions of UK holidaymakers annually, to the Mediterranean, the Canary Islands and to European leisure cities.”
The company’s airline Jet2.com has demonstrated a “high level of operational flexibility” by responding rapidly to evolving market conditions generating cash in doing so, “and we retain that flexibility to react quickly as travel restrictions change”.
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