easyJet struggles to contain costs despite revenue surge, posts H1 FY23 losses

easyJet announced its preliminary H1 FY23 results, indicating surging costs and revenues
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easyJet ended the first six months of the financial year with a preliminary net loss after surging revenues were overshadowed by increased costs. 

The low-cost carrier posted its preliminary H1 FY2023 financial results on April 18, 2023.  

The financial period ended on March 31, 2023, with easyJet recording a 35% increase in passengers in Q2 FY23 and 80% more revenue throughout the group, which unites the airline and its holiday business, in H1 FY23 compared to the corresponding period a year prior. However, that was offset by surging costs that have risen by 62% in H1 FY23 compared to H1 FY22. 

According to easyJet, while it remains “mindful of the uncertain macroeconomic outlook across the globe,” the low-cost carrier expects to end the financial year by exceeding “current market profit expectations of £260 million [$323.2 million] for FY23”. 

The preliminary group revenues rose by 80% from £1.4 billion ($1.7 billion) in H1 FY22 to £2.6 billion ($3.2 billion) in HY1 FY23. However, early estimated fuel costs alone more than doubled from £362 million ($449.6 million) to £770 million ($956.3 million), while total group headline earnings before interest, taxes, depreciation, amortization, and restructuring or rent (EBITDAR) costs increased by 62% from £1.7 billion ($2.1 billion) to £2.7 billion ($3.3 billion) during the corresponding period. 

Overall, the final headline net loss is expected to be between £425 million ($527.8 million) and £405 million ($503 million). 

“Demand for easyJet’s flights and holidays has continued to grow in the half, resulting in more than a £120 million pound improvement in our performance as well as a billion pound revenue improvement year on year,” commented Johan Lundgren, the Chief Executive Officer (CEO) of easyJet.  

Lundgren also noted that the low-cost carrier sees “continued strong booking momentum into summer as customers prioritise spending on travel and choose airlines like easyJet offering the best value and destination mix”. 

“All of this means easyJet expects to outperform FY23 market expectations,” Lundgren concluded.  

The company will publish its final H1 FY23 results on May 18, 2023. 

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