03 May 2006

EasyJet prospects improve despite costs

Reuters reports that budget airline easyJet said on Wednesday prospects were improving, helped by cost cuts and sales of in-flight drinks and online insurance, lifting its shares despite a hefty fuel bill and a wider first-half loss.

EasyJet, Europe's second-largest budget carrier after Ryanair, said it now expects pretax profit growth of between 10 and 15 percent for the year compared with a previous outlook for mid to high single digit percentage profit growth.

Analysts said this would suggest a full year pretax profit of between 90 and 95 million pounds.

EasyJet posted a pretax loss of 40 million pounds for the six months to the end of March compared with a 22 million-pound loss previously.

Analysts were forecasting a pretax loss of 42 million pounds, according to the mean of forecast in Reuters Estimates. EasyJet had tipped a 45 million-pound loss in February.

EasyJet's fuel costs rose 68 percent year-on-year to 166 million pounds, equivalent to 9.14 pounds per seat. The total included 12.5 million pounds from more flights.

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