Wizz Air expects return to profit after Q1 hit by disruption and high fuel costs
Wizz Air was hit by disruption, the war in Ukraine and high fuel costs in the first quarter of its current financial year, although it hopes to return to profit for the peak of the summer, the eastern European low-cost carrier announced.
It has reduced its summer flying schedule from June in light of the staffing shortages, detailing how daily cancelations reached 10% on certain days since June.
“Lingering restrictions from COVID-19 remained, particularly during April and May, while the war in Ukraine and supply chain disruptions affecting air traffic control, security and ground operation resources have impacted our utilisation,” chief executive József Váradi said in a statement on July 27, 2022.
“We are encouragingly starting to see normalization of operational disruption levels as we have lowered utilization by circa 5% for the summer versus F20, still operating industry-leading utilization,” the chief executive added.
The carrier made an operating loss of €285 million in the first quarter of its 2023 fiscal year, which covers the three months to June 30, 2022, compared with a loss of €109 million one year ago.
Fuel prices for the quarter were double pre-pandemic levels, Wizz said, confirming plans to return to a regular hedging policy to protect against fuel price increases.
While passenger numbers reached 12.2 million, more than the 10.4 million carried in the same quarter pre-pandemic, Wizz said ticket revenues per passenger were lower due to weaker demand as a result of lingering COVID restrictions and the war in Ukraine.
“We expect continued month-on-month momentum in net total fares and loads through the summer,” Váradi said, adding the carrier expects to operate 30% more flights this summer in terms of available seat kilometers (ASKs) versus pre-COVID levels.
The airline therefore expects to return to a “material operating profit” in its second quarter, which covers July, August and September 2022.
The results come after fellow European low-cost carriers Ryanair and easyJet reported results for the three months to June 30, 2022. Ryanair was the only one to make a profit.
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