EasyJet sees strong summer ahead as consumer confidence rebounds and travel restrictions are lifted

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Last modified on Thu 27 Jan 2022 05.10 EST

Travel companies are reporting a bounce back in bookings, with easyJet and Saga predicting a summer surge as the impact of Omicron on consumer confidence wanes, and the government’s move to lift testing and travel restrictions pushes capacity back to near pre-pandemic levels.

EasyJet said that while the final three months of last year showed a dramatic improvement on 2020 – easyJet operated 85.6m flights compared with 23.4m – the company missed its load factor forecast as Christmas travel plans were once again disrupted.

“This was due to the impact that Omicron had on customers’ confidence and ability to travel during December,” the company said. “EasyJet saw significant levels of late flight transfers out of December due to travel restrictions and concerns over Omicron.”

Easyjet said it expects Omicron to continue to have an impact over its short-term performance in the second quarter, the three months to the end of March.

However, the airline said that customers looked to rebook, rather than cancel, which will help boost its performance this year. In addition, the company said it has seen a “sustained step-change” in bookings after the government’s announcement earlier this month to remove pre-departure testing, and a further boost following the news that restriction-free travel will commence from 11 February.

“We see a strong summer ahead, with pent up demand that will see easyJet returning to near 2019 levels of capacity with UK beach and leisure routes performing particularly well,” said Johan Lundgren, chief executive of easyJet. “Booking volumes jumped in the UK following the welcome reduction of travel restrictions. We believe testing for travel across our network should soon become a thing of the past.”

Saga, the travel and insurance group specialising in products and holidays for over-50s, said it has seen strong bookings for its cruises in the period from 1 August to 26 January.

The company said that for this 2022-2023 financial year, which runs from 27 January, cruises have a booking load factor of 86% in its first half and 73% for the full year.

“While Omicron has impacted travel bookings through December and January, our outlook for cruises in 2022/2023 and beyond is positive,” said Euan Sutherland, chief executive of Saga.

The company said that the cruises operation produced profits on an adjusted basis in the period to 26 January, but a pre-tax loss of £45m to £50m.

EasyJet said that the loss in the first quarter of its financial year almost halved to £213m, compared with £423m in the same quarter in 2020. Group revenues were £805m, compared with £165m the previous year.

Overall, easyJet flew at 64% of pre-pandemic capacity in the final three months of last year, broadly in line with guidance, and a significant increase on the 18% capacity level in the same period in 2020.

Passenger numbers were 11.89m in the final three months of 2021, up from just 2.8m in 2020.

“We remain confident that easyJet will continue to win customers and are excited about our plans for the summer as we identify further opportunities at our key bases which will deliver strong, sustainable shareholder returns,” said Lundgren.

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