Image from Telegraph, Photo ALAMY
EasyJet has provided the first guidance of profit for the full year in its third quarter statement, indicating that it saw a pre-tax profit for 12 months to the end of September ranging between 545 and 570 million pounds. This had factored in the impacts of political issues that have been experienced in Egypt, Israel and Russia.
According to Thomson Reuters data, a forecast provided by analysts estimated a pre-tax profit of 569 million for this financial year. Shares in the company have been said to go down by 3.8 % at 1,348.5 pence by 0836 GTM, pairing an earlier decline at 8%.
Robin Byde, a Cantor Fitzgerald analyst who rates easyJet a ‘hold’ said they think that the statement adds to investor discomfort that the forecasts had generally run ahead. However, the majority of brokers are positive on the company with 60% of them rating it either a ‘buy’ or ‘strong buy’.
Air France – KLM, the second largest traditional airline in Europe, has warned this month that its profit for 2014 could be as much as 12% lower than what was forecast, mostly due to weak prices and overcapacity. Germany’s Lufthansa lowered its profit targets last month for the next two years.
In the last year, easyJet shares doubled in value and by this year April they had risen to an all-time high of 1,853 pence. Since that period, the shares have fallen by 27%. This happens amid questions regarding its future rate of growth.
The airline reduced the cost per seat by 1.3% year on year minus the fuel and currency movements, saying its performance assured it of future growth. The company says it sees profitable opportunities to grow within its core markets over the next three to four years.