EasyJet an­nual profit hit by slump­ing pound

Kuwait Times - - BUSINESS -

Bri­tish low-cost air­line EasyJet warned yes­ter­day it faced fur­ther fi­nan­cial tur­bu­lence from a Brexit-driven slump in the pound af­ter ter­ror at­tacks and la­bor dis­putes took their toll on an­nual prof­its.

Pre-tax profit tum­bled by 28 per­cent to £495 mil­lion ($618 mil­lion, 574 mil­lion eu­ros) in the year to Septem­ber 30 com­pared with 2014-15 “mainly due to the de­cline in rev­enue and for­eign ex­change im­pact”, EasyJet said in an earn­ings state­ment. It added that cur­rency fluc­tu­a­tions would cost it around £90 mil­lion dur­ing the cur­rent fi­nan­cial year, with £70 mil­lion in the first half. EasyJet said it planned cost sav­ings but gave no firm de­tails.

“EasyJet achieved a re­silient per­for­mance in 2016, in the face of sig­nif­i­cant chal­lenges in­clud­ing a series of ex­ter­nal events and for­eign ex­change head­winds,” group chief ex­ec­u­tive Carolyn McCall said in the state­ment. EasyJet has also been hit over the past year by in­dus­trial ac­tion and un­rest in key mar­kets Egypt and Turkey.

Mar­kets had ex­pected the lat­est fi­nan­cial re­sults af­ter EasyJet posted a profit warn­ing in Oc­to­ber. In morn­ing deals yes­ter­day, its share price was up 1.55 per­cent on Lon­don’s ris­ing bench­mark FTSE 100 in­dex. The pound has mean­while tum­bled fol­low­ing Bri­tain’s shock June 23 vote in favour of leav­ing the Euro­pean Union, strik­ing 31-year dol­lar lows and 7.5-year troughs against the euro.

The col­laps­ing value of the pound weighs on EasyJet’s per­for­mance be­cause it makes dol­lar-priced jet fuel more ex­pen­sive, ramp­ing up the cost of run­ning air­craft. — AFP

— AFP

GENEVA: An Air­bus plane of Bri­tish low cost air­line EasyJet tak­ing off un­der heavy clouds in Geneva. Bri­tish low-cost air­line EasyJet warned yes­ter­day it faced fur­ther fi­nan­cial tur­bu­lence from a Brexit-driven slump in the pound af­ter ter­ror at­tacks and la­bor dis­putes took their toll on an­nual prof­its.

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