- Jet2’s turnover jumped by 15% to £7.2bn in the year ending March
Jet2 profits soared to a record high last year as demand for package holidays remained strong despite cost-of-living pressures.
The airline, the UK’s third-largest behind British Airways and easyJet, said its turnover jumped by 15 per cent to £7.2billion in the year ending March, as passenger numbers rose by more than two million to a record 19.8 million.
Jet2 cited a surge in package holiday customers and consumers booking the firm’s more price-sensitive flight-only product.
Turnover was also boosted by passing on supplier-led cost hikes to package holiday clients and a greater average in-flight retail spend.
But its operating expenses jumped by £900million to £6.7billion, largely due to accommodation costs growing in response to supply-led inflation and more customers choosing higher star-rated hotels.
However, this failed to prevent the Leeds-based group’s profits from expanding by 12 per cent to £446.8million.
Flying high: Jet2 has hailed its best-ever annual result as demand for package holidays remained strong despite cost-of-living pressures
Following the performance, Jet2 intends to pay a higher final dividend of 12.1p per share, a 13 per cent uplift on the previous year.
It told investors: ‘We are very pleased to report another year of record financial performance as our leisure travel business once again proved that its unique, fully integrated approach is adaptable to changing trading environments, enabling it to maximise overall operating profitability.’
But despite the bumper full-year results, Jet2.com shares fell 6 per cent to 1,715p on Wednesday morning, although they are 35 per cent up over the past 12 months.
While Jet2 – formerly Dart Group – said current trading was in line with expectations, it noted that bookings were still happening closer to the departure date, consequently limiting forward visibility.
With the summer season not yet finished and a winter seat capacity of 5.8 million to sell, the business is not releasing full-year profit guidance.
Julie Palmer, partner at Begbies Traynor, said: ‘The continued trend towards later bookings, combined with ongoing geopolitical risks and a fragile economic backdrop, could weigh on consumer sentiment over the crucial summer months.
‘With that in mind and the bulk of peak season trading still to come, there’s little room for complacency.’
In February, Jet2 warned that the measures announced in Chancellor Rachel Reeves’ first budget, including the national insurance and minimum wage hikes, would increase its costs by another £25million.
At the same time, the firm stated that the government-mandated rise in sustainable aviation fuel to comprise 2 per cent of aircraft fuel loads will add a further £20million of incremental costs.
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This article was originally published by a www.dailymail.co.uk . Read the Original article here. .