Easyjet profits fall as it bids to become the world’s first “zero carbon” airline

EasyJet reported a fall in profits today, after a “difficult” year, but is hoping to become the first “zero carbon” airline by offsetting its carbon emissions at a cost of £25m a year.

Easyjet Airbus A20-200 © PASCAL PAVANI/AFP via Getty Images

Easyjet profits fell 26% in the year to 30 September
(Image credit: Easyjet Airbus A20-200 © PASCAL PAVANI/AFP via Getty Images)

EasyJet reported a fall in profits today, after a "difficult 2year driven by higher fuel costs, Brexit uncertainty and weakness in consumer confidence. Profit was still towards the top end of expectations, however.

Pre-tax profit fell 26% to £427m in the year to 30 September, down from £578 the previous year. Revenue rose by 8.3% to £6.385m and passenger numbers increased too by 8.6% in the 12 months to 30 September to 96.1 million but revenue per seat fell to just £60.81. With cost per seat including fuel at £56.74, the airline makes a just £4.07 per seat before tax. Dividend per share fell to 43.9p, down from 58.6p in 2018.

In a bid to head off the rise of "flight shaming" slowly creeping cross Europe, Easyjet said it will become the world's first "zero carbon" airline. Offsetting carbon emissions will cost £25m in the next year. Chief executive Johna Lundgren says this is just an "interim measure", with the company "supporting the development of new technology including electric planes to reinvent aviation".

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Easyjet is hoping to capitalise on the demise of tour operator Thomas Cook earlier this year by launching its own package holiday business offering"more than 100

amazing beach and city holiday destinations", which it says will be up and running before Christmas, with booking available for winter 2019 and summer 2020. Around 20 million people take flights with EasyJet every year, it says, but just half a million book accommodation with them.

It is not worried by Brexit, it says, despite admitting that uncertainty surrounding leaving the EU has contributed to its fall in profits. It boasts that it is in "a state of full preparedness for all possible Brexit outcomes", with air operators certificates in the UK, Switzerland and Austria, and 50% of its equity held by EU nationals.

Easyjet shareholders seem to be happy with the result.s The share price was up by almost 4% in today's early trading.

Ben Judge

Ben studied modern languages at London University's Queen Mary College. After dabbling unhappily in local government finance for a while, he went to work for The Scotsman newspaper in Edinburgh. The launch of the paper's website, scotsman.com, in the early years of the dotcom craze, saw Ben move online to manage the Business and Motors channels before becoming deputy editor with responsibility for all aspects of online production for The Scotsman, Scotland on Sunday and the Edinburgh Evening News websites, along with the papers' Edinburgh Festivals website.

Ben joined MoneyWeek as website editor in 2008, just as the Great Financial Crisis was brewing. He has written extensively for the website and magazine, with a particular emphasis on alternative finance and fintech, including blockchain and bitcoin. As an early adopter of bitcoin, Ben bought when the price was under $200, but went on to spend it all on foolish fripperies.