Easyjet on the upswing as restrictions are eased

LUTON - With easing travel restrictions, Easyjet has reduced total cash burn during the third quarter to £55million. The airline's capacity in Q4 will be up to 60% of 2019 levels, up from 17% in Q3/2021. In autumn, Easyjet will continue to take delivery of Airbus A320.

In order to capitalise on the opening-up of travel in continental Europe and the easing of restrictions for the fully vaccinated in the UK, Easyjet continues to pivot capacity towards popular routes where it sees rising customer demand.

Easyjet expects to emerge from the pandemic transformed, driven by a cost programme that is delivering, industry-leading network / schedule flexibility, a step change in ancillary revenue and with easyJet holidays taking market share.

Commenting on Q3 trading, Johan Lundgren, CEO of Easyjet, said: "This is all underlined by our proven business model, low fares, unrivalled network and brand trust which will be crucial going forward. So, while we know the road to recovery from the pandemic isn’t going to be a straight line we are ready to compete using these new-found strengths with everything we have learned leaving a long-term, positive imprint on the airline, transformed ready for the post-pandemic era.”

Passenger numbers for the quarter ending 30 June2021 increased to 3.0million, in line with an increase in capacity to 4.5million seats, representing 17% of Q3/2019 capacity levels. Ancillary revenue per passenger continues to increase as a percentage of total revenue.

400 percent increase of bookings after easing restrictions

Customers are currently booking much closer to departure due to market conditions with 49% of our Q4 schedule booked, which compares to 65% in 2019.

Booking rates on UK-touching flights have been lower than intra-EU flying due to the uncertainty around government restrictions. easyJet expect this to improve quickly as restrictions are lifted over the coming period.

UK-touching capacity is 44% sold (compared to 69% at this point in 2019) and intra EU capacity is 53% sold (compared to 64% at this point in 2019).

The management says it remains confident about demand for travel this summer and into autumn, due to the bookings surges experienced following selective easing of travel restrictions, such as the 400% increase in week-on-week flight bookings seen following the waiving of quarantine for fully vaccinated passengers returning from Amber list destinations.

No-shows rates have dropped to average just 4% across the network as consumer confidence to fly is increasing. CSAT and On-Time Performance rates continue above target.

Easyjet to take deliveries of A320s in autumn

Easyjet's fleet size has been reduced by c.10% in response to the Covid-19 pandemic. According to the airline, fleet plans allow flexibility to tailor the size of the fleet according to market conditions.

In 2022 they plan to grow to 317 aircraft enabling Easyjet to meet the high levels of pent-up demand expected in summer 2022 and also to take advantage of the post-pandemic opportunities to grow and strengthen our network.

Deliveries of new A320neo family aircraft will resume from this autumn. Easyjet will take delivery of eight new aircraft in 2022, seven in 2023 and 18 in 2024. In total the airline has 101 Neo aircraft on order, 20 purchase options and 58 unexercised purchase rights.

There are 38leased aircraft due to be re-delivered to lessors over the coming 15 months. We have already committed to extend some of these aircraft on very favourable operating lease conditions that are available in the current market.

In Q4 Easyjet expects to fly up to 60% of Q4 2019 capacity. Nevertheless capacity plans are flexible, depending upon the status of travel restrictions. Customers are booking closer to departure and visibility remains limited.