Jet2 counts £13 million cost of Rhodes wildfires and ATC meltdown
James ChappleJet2 chief Steve Heapy has said the airline and operator remains hopeful of exceeding its annual profit guidance despite counting the £13 million cost to the business from the recent wildfires in Rhodes and last week’s air traffic control outage.
In a trading update issued ahead of Jet2’s annual general meeting on Thursday (7 September), Heapy insisted that while their remained "some way to go" in the booking cycle for winter 2023/24, the business was "on track" to exceed current market expectations for pre-tax group profit for the year to 31 March 2024 of £480 million to £520 million.
This is despite having "absorbed" an approximately £13 million hit due to the wildfires which halted operations to Rhodes in late July and early August, and the impact of the UK air traffic control outage during last week’s bank holiday weekend.
Heapy added this guidance was also dependent on avoiding "any material extraneous events in the balance of the year". On Wednesday (6 September), Jet2.com and Jet2holidays confirmed it was pausing operations to Skiathos for the best part of a week owing to severe flooding following the passage of Storm Daniel.
On-sale seat capacity for summer 2023 stands at 15.26 million seats, which Heapy said was "largely consistent" with the 15.29 million seats it had on sale when the business posted its first-quarter results on 6 July and up 7.7% on summer 2022. Heapy put the small reduction in capacity down to the wildfires in Rhodes.
Jet2 said business in July and August was characterised by "strong late booking momentum", a trend Heapy said was continuing into September with average load factors just 0.5 percentage points behind summer 2022 at the same point, an improvement from 0.8 percentage points behind as of 6 July.
Heapy said forward bookings for winter 2023/24 were "encouraging" with load factors 0.3 percentage points ahead of winter 2022/23 at the same point against a 20.4% increase in seat capacity to 4.47 million, with the proportion of package holiday bookings up by more than five percentage points compared with winter 2022/23.
"For both seasons, average pricing to date for both package holidays and flight-only products has remained robust," said Heapy.
Heapy paid tribute to his Jet2 colleagues for their commitment during the "significant disruption" caused by the situation in Rhodes and also the Nats ATC outage. "Our UK operational and head office support teams, combined with our overseas teams at destination airports and in-resort, once again proved a real differentiator," said Heapy, adding the board wished to thank all colleagues for their "unstinting efforts" during the year so far.
Jet2 had placed an additional 11% seat capacity on sale for summer 2024; Heapy said early load factors were slightly ahead of summer 2023 at the same point.
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