Easyjet Down After Revenue Hit, Post Brexit Vote Fuel Costs
July 21, 2016 3:22 pm
Airline, Easyjet (EZJ.L) fell today after several negative news items hit the headlines. The companies Q3 results show that revenue has fallen in the period as a result of a drop in consumer confidence after several high profile terror attacks and the Eygpt Air disaster. For the period total revenue was down 2.6% and revenue per seat fell over 8%. Easyjet (EZJ.L) also lists a long list of other factors influencing the fall in revenue including Gatwick runway closure, ATC strike action and severe weather leading to the cancellation of over 1200 flights.
Chief executive Carolyn McCall in the statement said: “The economic and operating environment has been difficult in the third quarter due to a number of factors including air traffic control strikes and other industrial action, runway closures at London Gatwick and severe weather. These factors combined with industry capacity growth in short haul continue to have an impact on industry yields at a peak time of year. More recently currency volatility as a result of the UK’s referendum decision to leave the EU as well as the recent events in Turkey and Nice continue to impact consumer confidence.
Despite this, Easyjet (EZJ.L) carried more passengers and achieved higher load factors during the third quarter as EasyJet’s brand continued to resonate strongly across Europe. EasyJet is strongly controlling costs and driving continued improvement in operational and customer delivery. We are focused on the opportunities that are inevitable from a tougher environment.”
Also highlighted this morning as reported by the BBC (http://www.bbc.co.uk/news/business-36853577) were higher fuel costs caused by the slump in Sterling since Brexit. Easyjet pays for their fuel in Dollars and estimated that the slump has increased fuel costs by around £40Million adding even more pressure to the company.
Just before the close of trading Easyjet shares were still down around 4% trading at 1077p
Airline, Easyjet (EZJ.L) fell today after several negative news items hit the headlines. The companies Q3 results show that revenue has fallen in the period as a result of a drop in consumer confidence after several high profile terror attacks and the Eygpt Air disaster. For the period total revenue was down 2.6% and revenue per seat fell over 8%. Easyjet (EZJ.L) also lists a long list of other factors influencing the fall in revenue including Gatwick runway closure, ATC strike action and severe weather leading to the cancellation of over 1200 flights.
Chief executive Carolyn McCall in the statement said: “The economic and operating environment has been difficult in the third quarter due to a number of factors including air traffic control strikes and other industrial action, runway closures at London Gatwick and severe weather. These factors combined with industry capacity growth in short haul continue to have an impact on industry yields at a peak time of year. More recently currency volatility as a result of the UK’s referendum decision to leave the EU as well as the recent events in Turkey and Nice continue to impact consumer confidence.
Despite this, Easyjet (EZJ.L) carried more passengers and achieved higher load factors during the third quarter as EasyJet’s brand continued to resonate strongly across Europe. EasyJet is strongly controlling costs and driving continued improvement in operational and customer delivery. We are focused on the opportunities that are inevitable from a tougher environment.”
Also highlighted this morning as reported by the BBC (http://www.bbc.co.uk/news/business-36853577) were higher fuel costs caused by the slump in Sterling since Brexit. Easyjet pays for their fuel in Dollars and estimated that the slump has increased fuel costs by around £40Million adding even more pressure to the company.
Just before the close of trading Easyjet shares were still down around 4% trading at 1077p
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