EasyJet cuts profit guidance due to volcanic ash

11th May 2010 07:30

EasyJet reported a smaller than expected first half loss but cut its full year profit forecast due to the recent travel disruption caused by volcanic ash.The carrier revised its profit expectations for the year to a range of £100m to £150m at current exchange rates and fuel price, down from expectations of £175m to £200m prior to the recent volcanic ash related disruption."The disruption to European airspace due to the Eyjafjalla volcano happened after the period under review. However, this incident will have a significant impact on our full year financial performance as to date, easyJet has been forced to cancel 6,512 flights, disrupting 850,000 passengers," said the group."We estimate that the lost contribution and additional cost as a result of this event will be between £50m and £75m."Meanwhile, half year figures came in better than expected. The no-frills airline posted an underlying pre-tax loss of £78.7m. Nomura and Commerzbank were both looking for a £81m loss.Revenues grew by 13.3% to £1,170.7m and total revenue per seat grew by 5.1%, driven by good consumer demand. Nomura anticipated a 4.8% rise in total revenue per seat.Capacity, measured in seats flown, grew by 7.9%, while passenger numbers grew by 10.6% to 21.5 million. The group expects to grow passenger numbers by around 10% and increase both yield and load factor in 2010. EasyJet's position in European short haul aviation has strengthened and the group increased its market share from 6.5% to 7.6% of short haul aviation over the past 12 months.