easyJet plc

easyJet said underlying H1 results were consistent with expectations and in line with the April trading statement. Passengers increased 6% on 4% more seat capacity, load factor improved 2 percentage points to 90%, and easyJet Holidays passengers grew 22%; holidays profitability rose 39% to GBP 61 million PBT. Management said overall CASK increased 5% and CASK ex fuel rose 8%, with H1 impacted by an additional GBP 25 million fuel cost from volatile March prices and GBP 32 million of legal provisions. For the summer, easyJet said capacity has been trimmed by 0.3% after reallocating about 400,000 seats, and it is not planning further schedule changes or fuel surcharges. Guidance included summer CASK ex fuel rising in low single digits, continued delivery of 17 aircraft this year, 30 next year and 43 the year after, and medium-term ambition to deliver GBP 1 billion in PBT and more. Management also quantified A319-to-A320/neo upgauging benefits at GBP 110 million in 2027 and GBP 140 million in 2028, totaling GBP 250 million, and said this is already part of medium-term targets rather than additive.

Kenton Jarvis framed the quarter as a resilient operational performance in a volatile macro and fuel backdrop. He emphasized that easyJet is responding with disciplined capital allocation, moderated winter growth, continued hedging, and network optimization rather than chasing capacity for its own sake. He also struck a constructive tone on the long term, saying the company’s balance sheet, fleet mix, and route maturity support the path to more normalized margins and GBP 1 billion-plus PBT.

Jan De Raeymaeker focused on cost drivers, saying H1 CASK ex fuel rose 8% because of the GBP 32 million legal provisions, the absence of prior-year aircraft buyback benefits, resilience spending that carried into winter, load-factor-related passenger costs, adverse FX, and airport inflation, including Amsterdam up 34%. He said the 79 A319s in the fleet are 10% less fuel efficient and 24% more expensive on unit cost terms than A320s, and quantified the upgauging benefit at GBP 110 million in 2027 and GBP 140 million in 2028. He also highlighted liquidity of GBP 4.7 billion, net cash of GBP 434 million, 86% ownership of the neo fleet, and financing flexibility via cash, bonds, JOLCOs and asset-backed finance.

Analysts pressed on whether easyJet has an official cost program, how much bookings are weakening, and whether fuel concerns could force further capacity cuts. Management said the focus is on margin, not just cost, citing capital allocation, upgauging, productivity, turn-time improvements and digitization as the main levers; on bookings, they said demand is weakest 6-8 weeks out and that search volumes are down while conversion remains strong. They also said no further summer capacity cuts are planned, but winter will likely be moderated and could be reviewed if fuel or demand changes.