Jet2 plc

For the year ended 31 March 2026, Jet2 said revenue was up 4.3% to a record level, operating margin was 5.9%, and basic EPS was GBP 211.2. The company flew over 20 million passengers, up 5%, with flight-only passengers up 15% to 7.64 million and package holiday customers up 1% to a record 6.62 million. Non-ticket revenue per passenger rose 4%, package holiday pricing rose 3%, and flight-only net ticket yield fell 7% as management invested in price. Underlying costs excluding Gatwick start-up investment were up 4.5%, including hotel costs up just over 6.5%, landing/handling/navigation costs up 8.6%, fuel costs down just over 1%, marketing costs down 9%, and additional GBP 18 million of wage/tax costs. Operating cash flow was GBP 900 million, capex was GBP 391 million, free cash flow was GBP 495 million, net cash was over GBP 2 billion, and total cash was up 4% year over year. For trading guidance, management said summer 2026 booked average load factor for the first four months is 1.2 percentage points ahead of last year; holiday pricing remains in positive territory, while flight-only pricing is mid-single digits lower year over year. For FY2027, supplier-led cost inflation is running at just over 3%, or about 3.6% to 3.7% including FX headwind. Fuel is 97% hedged for summer 2026, over 90% hedged for FY2027, and 2028 is about 35% hedged. The company expects package mix to be around 60% this year, within its longer-term 60%-65% range.

Steve Heapy framed the year as another strong one and emphasized that Jet2 is growing in a controlled, customer-led way rather than simply chasing volume. He highlighted the strategic importance of the south of England, especially Gatwick, and said early performance there is encouraging, with higher package mix than expected and load factors in line with other London bases. His tone was confident and upbeat, repeatedly pointing to customer satisfaction, repeat bookings, and the A321neo fleet as key enablers of long-term growth.

Gary Brown focused on the detail behind the results: revenue up 4.3%, operating margin at 5.9%, EPS at GBP 211.2, operating cash flow of GBP 900 million, capex of GBP 391 million, and free cash flow of GBP 495 million. He broke down cost pressures, including hotel inflation, higher airport and navigation charges, GBP 32 million of SAF premiums, GBP 18 million of wage/tax pressure, and GBP 11 million of Gatwick start-up costs, while noting fuel was a modest offset. He also stressed balance-sheet strength, with GBP 1.2 billion of own cash, a GBP 500 million undrawn revolver, and a further GBP 250 million buyback announced, alongside medium-term plans to move toward 2x net debt/EBITDA over three to five years and keep own cash at GBP 600 million to GBP 700 million.

Analysts pressed management on close-in pricing, cost inflation, leverage, package mix, Gatwick ramp-up, and whether EES, hot weather, or possible consolidation would affect demand. Management said holiday pricing is holding up reasonably well, flight-only is more price sensitive, and they are investing in load factor; they also said 2027 cost inflation is just over 3%, or 3.6% to 3.7% including FX. On leverage and capital allocation, Gary said the 2x net debt/EBITDA target is a three- to five-year goal depending on aircraft financing and delivery timing, while Steve said Gatwick and the south offer meaningful share gains supported by customer service and available aircraft. They also said the new European entry system has caused some queues but Jet2 customers have been relatively unaffected, and they are lobbying governments for delays.