easyJet Shares Fly on Improved Forecast
LONDON -- easyJet (LSE: EZJ.L) announced a better-than-expected forecast for the full year in its pre-close statement this morning, sending shares up 4.5% to 621 pence at the time of writing.
The shares' positive swing came after the low-cost airline revised its outlook for the year to September 30 to estimate a pre-tax profit of £310 million-£320 million, up from the previous forecast at the end of July of £280 million-£300 million.
easyJet's chief executive Carolyn McCall commented:
easyJet has had a strong summer performance, which has enabled us to deliver another good year of returns and growth for our shareholders. Strong post Olympics trading and a benign operating environment along with the continued strict allocation of capital and aircraft across our leading network, improvements in revenue management and marketing, and a tight control of costs has meant that easyJet will deliver higher returns and its highest ever pre-tax profit for the financial year ending 30 September 2012, despite absorbing an additional �230 million in fuel costs this year.
We also continue to deliver for our customers with the best on-time performance in Europe this summer, low fares to convenient airports across Europe and our recently announced launch of allocated seating across the easyJet network.
Revenue per seat (at constant currency) is likely to increase between 5% and 5.5% for the six months to Sept. 30, 2012, compared to the previous guidance of "low to mid-single digits." The end of the Olympic Games signaled an increase in demand for routes from London, with "beach routes performing particularly well" as Brits took their holidays a bit later than usual this year.
Shares in easyJet are now approaching their previous five-year high of 666.41 pence, achieved in October 2007, having reached a low of 221.38 pence in that time in November the following year at the height of the financial crisis. Shareholders who bought into easyJet at that time will be delighted, having taken the plunge when the company was unloved.
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