Jet2 hikes profit outlook despite £13m hit from air travel chaos and wildfires
Jet2 is now expecting annual group pre-tax profits of between £480 million to £520 million, up from £390.8 million the previous year.
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Your support makes all the difference.Holiday group Jet2 has revealed a hit of around £13 million from “significant” disruption caused by the recent air traffic control failure and wildfires across popular destination Rhodes.
But the firm said that, despite the impact of the extra costs and lost profit margin, it was on track to beat results forecasts for the year to the end of next March thanks to strong summer bookings.
More than a quarter of all flights to and from UK airports were cancelled on August 28, a bank holiday Monday and a peak period for air travel, as National Air Traffic Services (Nats) were unable to process flight plans automatically.
More than a quarter of flights were cancelled that day, affecting around 250,000 people.
Cancellations continued for two more days as planes and crews were out of position, leaving thousands of passengers stranded overseas.
Airlines have been infuriated by the incident, which came at one of the worst times of the year, with little spare capacity across the sector due to it being the end of the summer break for many schools.
It came soon after the chaos caused by wildfires across much of Europe caused by a searing heatwave at the end of July.
The Greek island of Rhodes was particularly badly affected, with thousands of Britons having to be rescued.
As many as 10,000 Britons were estimated to be in Rhodes at the time of the fires.
Jet2 said its staff worked hard to help affected holidaymakers through the “significant disruption caused by the Rhodes and Nats incidents”.
“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,” it added.
The group said the wildfire disruption saw its summer holiday capacity drop slightly to 15.26 million air passenger seats, from 15.29 million reported in early July, but was still 7.3% higher than a year earlier.
“The months of July and August experienced strong late booking momentum with September currently showing a similar trend,” Jet2 said.
Winter bookings are also “encouraging”, with its holiday programme up 20,4% year on year to 4.47 million seats.
The group said: “Although there is still some way to go in the Leisure Travel winter booking cycle, based on current visibility and having absorbed approximately £13 million of cost and lost margin from the Rhodes wildfires and the recent Nats air traffic control failure, we are on track to exceed current market expectations for group profit before foreign exchange revaluations and taxation for the year ending March 31 2024.”
Jet2 is now expecting annual group pre-tax profits on a constant currency basis of between £480 million to £520 million, which would mark a significant increase on the £390.8 million reported for 2022-23.