Jet2.com expects to keep flying above the uncertainty of Brexit
Profits at group soar as leisure travel grows
DART GROUP, the owner of leisure airline Jet2.com, said it had enjoyed a strong summer and remained confident about the strength of its travel business despite uncertainties surrounding Brexit.
In the half year ended September 30, 2017, the group’s operating profit increased by 22 per cent to £204.9m. Group profit before foreign exchange revaluation and tax rose by 18 per cent to £198.2m.
Over the period, leisure travel revenue grew by 36 per cent to £1,580.9m. Dart Group said this reflected a 41 per cent increase in passenger numbers flown by Jet2.com to 7.14 million.
The company said that overall load factor remained in line with last year at 93.2 per cent. It included the first season of operation from its two new bases at London Stansted and Birmingham airports.
The statement to accompany the results said: “However, increased losses are to be expected in the second half of the year as we continue to invest in additional aircraft, advertising and people in readiness for further flying programme expansion at all our operating bases in the summer 2018 season.”
New loans were drawn down as the group continued to secure commercial debt and on balance sheet lease funding for the purchase of its new aircraft, the statement added.
The fleet was expanded to 75 aircraft for the summer of 2017, which is an increase on the 64 aircraft which made up the fleet a year earlier.
The statement added: “Given the increased flying programme, we were pleased to be recognised as the top UK airline for punctuality, for flights running on time over the last 12 months, by the world’s leading travel intelligence company OAG. We will continue to develop our customer-focused flying programme into summer 2018.”
The group’s distribution business, Fowler Welch, is one of the UK’s biggest providers of food supply chain services, serving retailers, processors, growers and importers through its distribution network. Fowler Welch’s revenue grew by 4 per cent to £83m during the half year.
Commenting on the trading outlook, Philip Meeson, the executive chairman of Dart Group, said: “Leisure travel customer volumes were strong during summer 2017 and, since the half year end, we have seen a further strengthening of customer demand, particularly for our flight-only product.
“This has resulted in future leisure travel bookings for this financial year performing ahead of expectations.
“As a result, the board is optimistic that market expectations of group profit before foreign exchange revaluation and tax for the year ending March 31, 2018 will be materially exceeded.”
He added: “Looking further ahead, whether this strength in demand will remain in the medium term is unclear, and will depend on the evolving competitive environment.
“Pleasingly, we have been encouraged by the performance of our two new operating bases and are committing additional aircraft to continue our growth at these and at our other bases for summer 2018.
“However, we are seeing the emergence of certain cost pressures as we continue to invest in our airport operations, colleagues and other related areas.
“Nevertheless, and despite the current uncertainty around the Brexit negotiations, we remain confident in the resilience of our leisure travel business, supported by our recent elevation to the UK’s second largest package holiday operator.”