EasyJet shares dive 10pc as French strikes take their toll

STRIKING French air-traffic controllers could slash £25m from budget airline easyJet’s profit and caused shares to tumble nearly 10pc yesterday.

EasyJet yesterday reported a profit for its first half of the year for the first time in 13 years but a warning about its third quarter – hit by the French strikes – worried investors.

Shares nosedived 9.8pc or 179p to 1654p as the 600 cancelled flights (because of French industrial action) could cost it £25m. The problems in April were also exacerbated by the Germanwings disaster in the Alps which easyJet chief executive Carolyn McCall said led to a ‘cooling off period’.

EasyJet’s shares have been one of the best Footsie performers over the past two years so yesterday’s sell-off was also thought to be profit taking. The low-cost airline reported a £7m pre-tax profit for the six months to the end of March, from a £53m loss a year earlier.

The winter period is usually loss-making for airlines.

The weak euro against the pound and the falling oil price helped the airline’s first-half. But for the full-year, exchange rate movements would reduce profit by around £20m. EasyJet also revealed it will increase the number of seats on its A320 aircraft by six – an extra row for each plane – to 186. EasyJet’s chief financial officer, Chris Kennedy, said that would maintain ‘passenger comfort and reduce cost’ by using unused space at the back.

Sales rose 3.8pc to £1.77bn, helped by a strong ski season. Margins for the half year improved by 3.5 percentage points and capacity grew by 3.6pc to 32.2m seats.

McCall, pictured, said passengers now get cheaper air fares thanks to the reduced fuel with 50pc of fares under £50.

The average easyJet fare for the past six months, including April, was just over £55. She said demand for flying has increased and the lower fares will ‘stimulate further demand.’

In the six months to March 31 2015, easyJet returned £180m or 45.4p a share, in dividends.