Wizz Air delivers optimistic outlook as summer trading starts well
[Photofex - stock.adobe.com]
Budget airline has said that it is "trading positively" into the summer with operating margins expected to improve this year, as it reported that annual profits for the year ended 31 March would be in line with previous guidance.
The company said it expects to deliver net income of €350-370m for year just gone, narrowing its guidance from €350-400m at the time of its third-quarter results in January.
Total revenues are tipped to be €5.05-5.10bn, up from €3.90bn the year before, reflecting stronger ticket revenue and pricing.
However, this was "partially offset by softer ancillaries in H2 as a result of the combination of network-related impacts from geopolitical events and resulting short window capacity redeployment", the company explained.
In line with previous guidance, revenues per available seat kilometre are expected to have grown at a mid-single-digit rate compared with last year.
Looking ahead, Wizz continues to expected flat year-on-year capacity growth over the current financial year, but said it is "trading positively into the summer of 2024 with selling load factors and pricing trending higher year-on-year in the first two fiscal quarters".
"Based on improved operational metrics, current trading dynamics and continuing capacity constraints in the wider market, the Company expects to expand operating margins, increase operational cash and further reduce net debt in F25," the company said.
"This year we have seen a continuation of the surge in passenger demand for air travel that began immediately after the pandemic," said chief executive József Váradi.
"While Wizz Air benefitted from this sustained demand and reported record passenger numbers throughout the year, we also mitigated new challenges, including a further wave of geopolitical unrest, the Pratt & Whitney GTF engine recall and air traffic control disruptions."
The stock was up 5.5% at 2,224p by 1029 BST.
Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.