easyJet share price crashes even as airline flies to H1 profit
easyJet (LON:EZJ) has returned to profit in the first half of its financial year, benefitting from a lower fuel bill and favourable currency movements. easyJet’s share price, however, has slumped in early morning trade, as the company sounded a note of caution on its second-half revenue which is likely to be impacted by last month’s over 600 cancellations. As of 08:18 BST, easyJet’s share price had lost 7.37 percent to 1,697.98p, underperforming the blue-chip FTSE 100 index which has shed 1.14 percent to 6,949.89 points.
The budget airline this morning reported a pre-tax profit of £7 million for the six months ended March 31, 2015, as compared with a loss before tax of £53 million a year ago. easyJet’s total revenue came in 3.8 percent higher year-on-year at £1.77 billion.
Commenting on the results, easyJet’s chief executive Carolyn McCall attributed the return to first-half profit to “the delivery of our customer focused revenue initiatives and a strong finish to the ski season as well as the benefit we received from the lower fuel price and favourable foreign exchange movements”.
The company, however, was less upbeat on its second-half prospects, noting that April had been “a more difficult month due to increased disruption with over 600 cancellations, the majority of which were caused by the extended French Air Traffic Control strikes”. easyJet estimates that the disruption would adversely impact the company’s pre-tax profit by around £25 million, and expects its second-half revenue per seat to decrease by low single digit percentage points.
The timing of Easter is expected to weigh on the company’s third-quarter financial performance, which will also be impacted by last month’s disruption. easyJet noted that taking into account “a one percentage point reduction in underlying trading means we expect third quarter revenue per seat at constant currency to be down around 4 percentage points”.
As of 09:06 BST, Tuesday, 12 May, easyJet plc share price is 1,683.00p.