EasyJet suffers 17% profits fall but cheers 'encouraging' recent trading

Collapse of rivals benefits Easyjet as it publishes full year results

Collapse of rivals benefits Easyjet as it publishes full year results

Carolyn McCall, easyJet's outgoing Chief Executive, said, "easyJet delivered a robust performance during a hard year for the aviation industry".

The collapse of several of its rival airlines has boosted the growth of Europe's second-largest budget airline, easyJet, with its revenue rising 8.1 per cent from the same time a year ago to £5bn.

Easyjet said earnings had continued to climb in the first quarter of this year, "primarily as a result of some capacity leaving the market".

Full-year pre-tax profits at EasyJet dropped 17.3 per cent as the airline weathered a currency hit of £101m.

Its rival Monarch collapsed last month, while Alitalia and Air Berlin went into administration earlier in the year.

Total revenue increased 8.1 percent to 5.05 billion pounds from 4.67 billion pounds a year ago, reflecting a currency benefit, strong ancillary revenue and increased load factors, alleviating ticket pricing pressures.

EasyJet also cut its proposed ordinary dividend per share by almost a quarter to 40.9p, with total basic earnings per share dropping 30 per cent, saying it was in keeping with the firm's increased payout policy of 50 per cent of headline profit after tax.

The company said the dip was down to "unfavourable movement from foreign exchange" and at constant currency, headline profit before tax was £509m for the year. Still, the airline said its policy of paying its dividend from headline profit after tax is expected to deliver dividend growth in the 2018 financial year.

Other key metrics included record capacity, load and passenger numbers - the latter up nearly 10% at 80.2 million.

EasyJet also noted that its forward bookings were ahead of past year at 88 percent for the first quarter and 26 percent for the second quarter.

In July, McCall announced she would leave easyJet to take up the role of chief executive at ITV.

Despite its upbeat assessment on bookings for the current year, the company warned that costs from its deal to buy up to 25 aircraft and recruit 1,000 staff from Air Berlin would weigh on annual profits for 2017/18.

Looking ahead, easyJet said it will continue its strategy of purposeful investment to drive profitable growth. easyJet plans to grow capacity by around 6 percent for the 2018 financial year, excluding any prospective Air Berlin capacity.

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