EasyJet has said the Omicron variant of coronavirus hit passenger demand last month, but revealed it has seen a recent boost in bookings from the move to scrap Covid travel tests.
The low-cost airline said Omicron saw its load factor, a measure of how well it fills its planes, slump to 67% in December after recovering past 80% in October and November.
Despite the Omicron impact, EasyJet almost halved headline pre-tax losses in its first quarter to the end of December to £213m, down from losses of £423m a year earlier.
The carrier said it has seen a “step change” in bookings since the January 5 announcement that pre-departure Covid testing would be scrapped for fully vaccinated arrivals entering England, with demand buoyed further by news of restriction-free travel from February 11.
Chief executive Johan Lundgren said the UK is “leading on bookings versus Europe for the first time since spring 2020”.
It is “traditional beach and leisure destinations that are recovering the quickest”, he explained.
EasyJet will operate its largest number of flights between the UK and beach destinations this summer, with an overall 14% rise in capacity on routes making those operations “the biggest ever” in the airline’s 26-year history.
The airline is boosting the number of seats on flights to Greece and Turkey, while Spain also has “encouraging signs of demand for the summer”, Mr Lundgren said.
EasyJet said that, while Omicron is expected to continue to have a short-term impact on its performance in the quarter to the end of March, its flight programme will “ramp up” from just 50% of 2019 levels in January to near pre-pandemic levels between July and September.
Mr Lundgren said: “EasyJet produced a significant year-on-year improvement in the first quarter, despite the short-term impact of Omicron in December.”
He added: “Booking volumes jumped in the UK following the welcome reduction of travel restrictions announced on 5 January, which have been sustained and then given a further boost from the UK Government’s decision earlier this week to remove all testing requirements.”
Many European destinations popular with UK holidaymakers continue to require coronavirus tests for arrivals, even if they are fully vaccinated.
They include Cyprus, France, Greece, Morocco, mainland Portugal and Switzerland.
But Mr Lundgren said he expects testing for travel “across our network should soon become a thing of the past”.
He went on: “We see a strong summer ahead, with pent-up demand that will see EasyJet returning to near-2019 levels of capacity, with UK beach and leisure routes performing particularly well.”
Bristol Airport is one of the airline’s largest bases across its network and from the summer it will operate a fleet of 17 aircraft there, following the addition of an Airbus A320 plane announced in November.
Ali Gayward, easyJet’s UK country manager told BusinessLive the extra aircraft and the addition of eight new routes from Bristol reflected the firm’s positivity in a “resurgence of business” in the South West.
Ms Gayward said: “We will be operating 78 routes from Bristol, which is the largest range of network we’ve ever operated.
“We have the strength of our Easyjet Holidays brand to support Bristol as well. We’ve been in Bristol since 2002, so it will be 20 years this summer, since we acquired the Go operations. We’re a really well-known and trusted brand in the South West of England, I think the Easyjet Holidays proposition further strengthens that.
“We have seen a significant growth in demand for Easyjet Holidays from the whole of the South West region, which is really encouraging. In fact, they have sold over 50% of their holiday capacity for this summer.
“We’re expecting to be operating almost back to 2019 levels this summer, and that is certainly what the early indications are suggesting to us, which is really encouraging.”
Ms Gayward added that the company was prepared for the eventuality of further Covid disruption, including the emergence of new variants of the virus and a return to travel restrictions.
Ms Gayward said: “We went into the pandemic with one of the strongest balance sheets in the industry and we’ve done a huge amount throughout the pandemic to continue to shore up our resources.
“We still have access to around £4.4bn worth of liquidity, and we are prepared for any further bumps along the road that we see with new variants. We always said that we expected this winter to be a bit of a bumpy ride, and it has been with Omicron, we don't deny that, but we are prepared for more such bumps along the road.
“We are not out of the pandemic yet, but I think everything we are hearing is that the worst of it should be over and we can feel positive as we come into summer.”
Ms Gayward confirmed EasyJet had “aggressive growth plans” looking ahead to winter and summer 2023, of which Bristol remained a “core” part. She said the airline has plans to introduce new aircraft next year though it had not been finalised which airports they would be deployed to.
Ms Gayward said that an ongoing review of EasyJet’s cost control had allowed for reductions in the region of 50% in some areas, and that it would be able to operate as a low fare carrier, despite inflationary pressures on businesses and consumers caused by the pandemic.
Ms Gayward said: “We have always been a value carrier and low fares and value for money has always been at the core of what we do. As we emerge from pandemic and the impact on economies across the world recover, cost is going to be going to be king. That’s why it is important we look at our entire operating model so that we continue to deliver that value for money.”
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