Shares in JET2 PLC (LON:JET2) interfered with more than 6% at lunch on Thursday after the airline recorded its six-month results, with the coronavirus pandemic losing £111 million in the six months leading up to September.
The company reported a group that will operate a £111.2 million group over a six-month period, compared to a £361.5 million profit in 2019 before the travel and tourism industry was destroyed by global lockdown measures.
Jet2 was forced to ground the entire fleet in March, when the UK government implemented the first wave of travel restrictions. The airline was able to resume operations in July, but lingering concerns about flight safety during the pandemic have only had 99 million passengers flying over the course of six months.
With the reduction in summer flight programs, JET2 can concentrate on the most profitable routes, and companies argued that a “fast and flexible operating model to the market” would help them withstand the intense uncertainty of the industry.
Nonetheless, the damages are clear. The average load factor (number of seats filled with planes) was only 69% compared to 93.1% in 2019. This is a decline that Jet2 has denounced “uncertainty created by several changes to the UK government’s quarantine guidance.”
In the approaching winter season, the JET2 says it expects to fly about 50% of last year’s seating capacity, with investors fighting the meaning of the company’s basic revenue free fall from just 56.9p to just 56.9p since September last year.
However, the airline wanted to emphasize that its after-tax gross profit remains green and solid at £278.6 million.
Jet2 executive chairman Philip Meeson said the pandemic has raised “unprecedented operational and financial challenges,” but added that the group has benefited from a “strong and carefully managed balance sheet” and its “quick response to the pandemic.”
“A further losses are expected later in the fiscal year as the proposed Summer 21 Flight Program is ready and ready, as typical for the business.
“In addition, the UK government’s guidance limits international travel except for limited circumstances, until at least December 3, 2020, so the ability to fly in the short term remains uncertain.”
JET2 stock fell 6.72% to 1290.00p at 12:38 BST on Thursday, following a turbulent year that reached an annual Nadir of 305.80p in March.
Airline performance has been featured in recent months, which has increased by 108.91% over the past three months alone, but questions remain about the impact of the UK’s current second lockdown as expansions are considered and Christmas holiday plans are under threat.
