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easyJet boosted by Air France strike | easyJet boosted by Air France strike |
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Shares in easyJet jumped more than 8 per cent in London trading after a strike at rival Air France propelled the budget airline to a City upgrade that will see it hit record profit for the fourth year in a row. | Shares in easyJet jumped more than 8 per cent in London trading after a strike at rival Air France propelled the budget airline to a City upgrade that will see it hit record profit for the fourth year in a row. |
Last month, Air France pilots went on strike for a fortnight in a dispute over contracts which saw about half of its flights cancelled. | Last month, Air France pilots went on strike for a fortnight in a dispute over contracts which saw about half of its flights cancelled. |
Many of the 150,000 passengers who were booked on the French airline switched to easyJet’s routes, helping the FTSE 100 carrier to pocket an extra £5 million of fares. | Many of the 150,000 passengers who were booked on the French airline switched to easyJet’s routes, helping the FTSE 100 carrier to pocket an extra £5 million of fares. |
That, combined with what easyJet chief executive Carolyn McCall, pictured, said was a “strong finish to the year”, saw its board tell the City today that pre-tax profit for the year to October would be between £575 million and £580 million, sharply higher than an earlier forecast of £545 million to £570 million. | That, combined with what easyJet chief executive Carolyn McCall, pictured, said was a “strong finish to the year”, saw its board tell the City today that pre-tax profit for the year to October would be between £575 million and £580 million, sharply higher than an earlier forecast of £545 million to £570 million. |
It means easyJet’s annual profit will be at least 20 per cent higher than last year’s £478 million. The improved forecast also comes just weeks after the budget carrier announced a hike in its dividend policy — it will now pay 40 per cent of post-tax profits in dividends, rather than the earlier 33 per cent — meaning that easyJet will be handing its shareholders their largest-ever ordinary payout. | |
Shares in the airline rose 111p to 1482p on the news, although easyJet’s stock had fallen by around a quarter since it reached a record peak in April. | Shares in the airline rose 111p to 1482p on the news, although easyJet’s stock had fallen by around a quarter since it reached a record peak in April. |
McCall brushed over the positive impact of the Air France strike — which cost that carrier almost £300 million — simply saying easyJet had “continued to execute its strategy, delivering another strong performance in the second half of the year”. | McCall brushed over the positive impact of the Air France strike — which cost that carrier almost £300 million — simply saying easyJet had “continued to execute its strategy, delivering another strong performance in the second half of the year”. |
The orange airline also gave investors good news about next year, saying hedging meant its fuel bill for the next financial year will be about £50 million lower and revealing more than a quarter of seats for flights taking off between October and March have already been sold, slightly more than in the same period last year. | The orange airline also gave investors good news about next year, saying hedging meant its fuel bill for the next financial year will be about £50 million lower and revealing more than a quarter of seats for flights taking off between October and March have already been sold, slightly more than in the same period last year. |
The carrier has pushed hard to lure business travellers to its planes, offering allocated seats, flexible tickets, and higher frequencies on key routes — a move that rival Ryanair is now aping. | The carrier has pushed hard to lure business travellers to its planes, offering allocated seats, flexible tickets, and higher frequencies on key routes — a move that rival Ryanair is now aping. |
EasyJet’s success at doing so was boosted by the strike at Air France as well as industrial action at Germany’s national carrier, Lufthansa. | EasyJet’s success at doing so was boosted by the strike at Air France as well as industrial action at Germany’s national carrier, Lufthansa. |
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