Easyjet planning to change its British AOC
The weakness of Sterling is expected to impact easyJet’s year on year Profit before tax for financial year 2017 by around 105GBP million.
The british air-carrier looking for a new home within the EU after the verdict of referendum. Though the first quarter of 2016 was solid and passengers growth in capacity of 8.6% to 19.3 million seats.
Despite the Brexit and the weak sterling victim of the referendum and the impact of fuel Easy jet has managed to deliver a solid first quarter underpinned by increased operational and financial flexibility and balance sheet strength.
However head-line costs incurred and for 2017 the company planning to establish an air operator certificate in another EU member state. As this plan will secure the flying rights of the 30% of air network that remains wholly within and between EU states excluding the UK. This one off cost is expected to total around 10 million GBP over two years with up to 5 miilion GBP incurred in the 2017 financial year.
The primary driven cost is the re-registering of aircraft in an EU AOC jurisdiction.
Also number of passengers carried increased by 8.2% to 17.4 million. “The weakness of sterling and the impact of fuel combined are 35 GBP worse than previously expected but easyjet has made good progress in reducing costs in those areas where we have more control such as engineering maintenance non-regulated airports and overheads” said Easy jet’s Chief Executive on a statement.
According to sources the total revenue in the quarter increased by 7.2% to 997 million GBP reflecting the increase in passengers carried throught the period. Revenue per seat decreased by 8.2% at constant currency.
Moreover sources adding that: “ Easy jet issued a 500 euro bond at 1.25% coupon supported by both Moody’s and Standard & Poor’s sector-leading ratings the british airline also extended its $ 500 million revolving credit facility by another year to 2022
