Budget airline easyJet has reported its first half-year profit in 13 years, although the feat was overshadowed by a warning its third-quarter had been marred by a strike in France, reports The Telegraph.
Shares in the FTSE 100 slumped as much as 7.3 per cent in early trading after the no-frills carrier said that the disruption caused by industrial action among French air traffic controllers, which led to the cancellation of more than 600 flights, would cost it approximately £25m.
News of the hit eclipsed the airline’s interim results, in which easyJet swung to a pre-tax profit of £7m in the six months to the end of March, from a £53m loss a year earlier.
Airlines typically depend on the summer months to generate profits, and easyJet had only managed to post a first-half profit once before, when in 2002 it record a £1m pre-tax profit.
This year, plunging oil prices, which led to a lower fuel bill, and the weak euro gave the FTSE 100 carrier a lift during its first-half.
Oil prices tumbled in the latter half of last year, and the airline benefitted from lower fuel costs as a result. Brent crude, which traded at a high of $115 (£74) a barrel in June, fell as low as $46.59 in January.
The introduction of a quantitative easing scheme by the European Central Bank has also helped out chief executive Carolyn McCall, weakening the value of the euro and giving easyJet a boost.
Ms McCall said: “The profit in the half reflects the delivery of our customer focused revenue initiatives and a strong finish to the ski season as well as the benefit we received from the lower fuel price and favourable foreign exchange movements.
“As we enter the important summer season forward bookings are in line with last year and as we predicted passengers are benefitting as fares fall to reflect a more competitive operating environment and lower fuel costs.”
Image: Easyjet via Shutterstock
