EasyJet revises first-half revenue outlook upwards

By Victoria Moores

UK budget carrier EasyJet has upwardly revised its interim revenue expectations after its first-quarter total rose 32% to £550 million ($764 million).

London Luton-based EasyJet's number of seats sold rose 10.1% to 10.1 million during the three months ending 31 December. Its revenue per seat grew by 23% to £45.57, or 14% on a constant-currency basis.

EasyJet CEO Andy Harrison says: "EasyJet revenues for the first half will be ahead of previous guidance, although the unit revenue outlook for the summer remains uncertain due to the difficult macro-economic environment and any potential impact from the strengthening of the euro against sterling.

"Consequently, EasyJet reiterates guidance that for the full year, at current fuel and exchange rates, EasyJet expects to be profitable."

The budget carrier adds that its first-quarter revenue growth was ahead of expectations. It anticipates second-quarter total revenue per flown seat to be slightly ahead of the previous year, at constant currency, despite the Easter holiday's falling in the third quarter this year.

EasyJet's growth was driven by a 20% rise in passengers originating in mainland Europe. It claims more than half its passengers, 51%, now originate outside the UK against 43% in the first quarter of financial year 2007.

Ancillary revenues for the quarter rose by 71% per seat to £8.68, driven by baggage fees, improved catering and better conversion rates.

The airline is expecting its first-half costs per seat, excluding fuel, to rise by mid- to high-single digits at constant currency. Its interim pre-tax margins will fall, owing to fuel costs being around £3.60 per seat higher than last year, but second-half unit fuel costs are expected to be broadly in line with last year.

EasyJet says its forward bookings over the second and third quarters are around last year's levels.

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