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| Ground truth |
London, Aug. 7 (Reuters): Low-cost airline easyJet said on Monday it expected capacity growth to be slower this year but maintained its forecast of a 40-50 per cent rise in profits despite high fuel costs.
The company also reported a 11.3 per cent rise in July passenger traffic and said its load factor — a measure of how many seats it has filled — was 90.4 per cent of capacity last month.
It said full-year revenues and costs would be slightly higher than expected but capacity growth would slow to 13 per cent this year, lower than the 15 per cent expected by analysts.
EasyJet shares fell 1.3 percent to 426 pence at 0817 GMT after touching a low of 421-1/4 pence. Analysts said easyJet had wound back its growth plans due to problems crewing its aircraft.
“This will mean higher costs and puts into question the prior leanness of operations and how much extra cost will be needed on an ongoing basis,” UBS said in a note to clients.
In its third-quarter trading update, easyJet repeated a forecast made last month of pre-tax profit growth for the full year of 40-50 per cent.
Europe’s second-largest budget carrier after Ryanair said its total revenue per seat rose 17 per cent in the quarter to 45 pounds.
In July, easyJet said it expected passenger revenue per seat to be 3-4 per cent higher for the year.
The airline has been growing ancillary revenues as passengers spend more money on drinks, food, online insurance, hotels and car hire.
Rivals Ryanair and British Airways both warned last week they expected a tough winter period with stiff competition likely to drive down ticket prices.