Jet2 updates annual profit forecast amid strong trading

Jet2 expects its 2023-24 annual profit to rise by a third over the previous year on the back of strong sales.

The UK’s largest tour operating group expects a pre-tax profit for the year to March 31 of between £515 million and £520 million against a previous £510 million-£525 million estimate.

However, the increase of about 33% year-on-year was described in a trading update as being in line with current market expectations. 

The group’s balance sheet was reported as being “very strong” with total cash of £3.2 billion and a balance excluding customer advance deposits of £1.3 billion.

Seat capacity for summer 2024 is currently 12.3% higher than last year at 17.1 million seats with the season is 55% sold, with average load factors one percentage point ahead of summer 2023 at the same point. 

Forward bookings for package holiday customers are up by 13% with Jet2 reporting “healthy demand” from flight-only passengers with bookings up by more than 18%. 

“Consequently, the package holiday mix of total departing passengers is 74% and one percentage point below last year,” the company disclosed.

Pricing for summer 2024 bookings is showing a “modest increase” compared to the same period last year.

This is helping to mitigate previously announced increases in input costs, “although recently, pricing has been more competitive, particularly for April and May departures”.

Jet2 said: “Operationally we are well set for a successful summer 2024 season with the required number of aircraft to support our flying programme and sufficient, fully trained resources to operate our end-to-end product proposition to our normal high standards of customer care. 

“We are also over 90% hedged for fuel for the season and over 80% for the full financial year in line with our well-established hedging policy, providing important cost certainty given unfolding events in the Middle East.”

Two new Airbus A321neo aircraft have joined the fleet since February to bring the number of the new-generation type up to seven for the summer peak with another four planned to arrive before the end of the current financial year. 

Flight operations from Jet2’s new Liverpool airport base have started successfully, “with forward bookings encouraging and customer feedback very positive”.

The group added: “In summary, we are pleased with our progress for FY25 to date although as ever, we remain mindful of the current macro-economic and geo-political environments and how these may impact future consumer spending. 

“Consequently, and with over 40% of summer 2024 and the majority of winter 2024-25 seasons still to sell, it is too early to provide guidance as to group profitability for FY25.”

The group is due to issue preliminary results for the year to March 31 on July 11 when a fuller outlook for the “all-important” summer 2024 trading period will be provided.

Chief executive Steve Heapy said: “We are pleased with the strong financial results for FY24 which underlines the resilience, flexibility and popularity of our product offering, plus the outstanding customer service provided by our colleagues. 

“Although still very early in FY25, we remain confident that as a much trusted holiday provider with an end-to-end customer care approach underpinned by our principles of ‘People, Service, Profits’, our customers will continue to travel with us from our rainy island to the sun spots of the Mediterranean, the Canary Islands and to European leisure cities.”

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