EasyJet income falls over 50% as Covid-restrictions stall journey plans

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LONDON — Revenue at EasyJet fell more than 50% in the year to the end of September, the company said on Tuesday, after the coronavirus pandemic brought the travel industry to a halt. The British airline said it was only expecting to fly about 20% of its planned capacity in the final three months of 2020.

EasyJet reported revenue of £3 billion for its full 2020 fiscal year, marking a drop of 52.9% from the previous year.

The number of passengers also sank by 50% over the same period on the back of stay-at-home orders, quarantine policies and other Covid-related restrictions.

Other highlights for the year:

  • Capacity fell 45.7% from 2019.
  • Revenue reached £3 billion compared to £6.4 billion a year ago.
  • Load factor (the percentage of seating capacity filled with passengers) was down by 4.3 percentage points.

Despite the troubling times for the business, EasyJet’s CEO said the company was on track to benefit from a recovery phase.

“We also know the attraction to the brand in terms of the trust it generates for customers, and also, the value for money that we represent gives a good foundation and bounce back strongly when the recovery comes,” Johan Lundgren, EasyJet CEO, told CNBC’s Squawk Box Europe Monday.

He added: “The longer these travel restrictions are in place, it actually increases pent-up demand.”

For example, the airline said that within 24 hours of the U.K.’s government’s decision to remove mandatory quarantine to those arriving from the Canary Islands in late October, sales increased 876% over five days.

In addition, Lundgren said the latest announcements surrounding a Covid-19 vaccine were “definitely good news for us.”

On Monday, Moderna said its coronavirus vaccine was more than 94% effective. Last week, Pfizer and BioNTech also announced their vaccine had an efficacy rate above 90%

“The news of the vaccine is really good and I think it will really help to bolster the demand and the confidence for people to make future travel plans,” Lundgren said.

Shares of EasyJet are around 45% lower since the start of 2020.

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