Business travellers boost easyJet's profits

15 November 2011

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15 November 2011 |Angeline Albert    

The rise in business travellers using low cost airline easyJet saw its profits soar for the past six months.

The number of business customers using the airline increased by almost one million to 9.5 million, according to the company’s interim results for the six months ended 30 September, published today. The company’s underlying profit before tax rose by £60 million to £248 million, from an underlying profit of 188 million in 2010.

The company’s goal is to make an extra £100 million from business passengers. Part of this effort has led to the signing of more agreements with travel management companies. Today, easyJet announced it had signed a deal with Amadeus, a global distribution systems (GDS) supplier to help it capture a bigger share of the managed corporate travel market.

Paul Tilstone, CEO of Institute of Travel & Meetings, which represents more than 1,000 travel buyers and suppliers in the UK and Ireland, told SM: “I had the choice of flying any airline this morning but I flew today as an easyJet business traveller to Amsterdam, because I had the best schedule and price from the airline. Purchasers want the most pertinent schedule at the best price and easyJet has adapted its business model to cater to this. The airline has engaged with GDS suppliers and will continue to do well in the business travel market particularly as companies feel more pressure to squeeze savings from corporate travel.”

The strong financial performance was in spite of a £100 million increase in the airline’s fuel costs. In response to the rise the airline said it does not plan to purchase more aircraft for the next two years to add to its 204-strong fleet. Purchasers have planned for a further 35 new craft to be delivered during the next three years, but this will be offset by 24 planned exits from the fleet. “The high cost of jet fuel and uncertain consumer demand across Europe means easyJet is taking a cautious approach to capacity,” the report said.

At current fuel and exchange rates, easyJet’s fuel bill is expected to increase by £220 million in 2012/13 compared with 2011/12.


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