EasyJet profit hit by slumping pound
BRITISH low-cost airline EasyJet said yesterday its annual profit before tax slumped by almost one-third due to a Brexit-driven tumble in the pound, terror attacks and strikes.
Pre-tax profit fell 28 percent to £495 million (US$618 million) 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 its current financial year.
EasyJet has been hit over the past year also by industrial action and unrest in key markets Egypt and Turkey.
The latest financial result had been expected by markets after EasyJet posted a profit warning in October. The pound has tumbled following Brexit, 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.