British budget airline easyJet has said future bookings are down as concerns over Brexit and economic uncertainty sap consumer demand.
But despite the tough trading environment, the operator said it would meet its profit expectations in 2019.
In response, shares in the airline, which had fallen 13% since its April trading update to their lowest in more than two years, rose by 4.9% in early trading.
This was in stark contrast to shares of Thomas Cook, which slumped for the second straight day plunging nearly 30% after issuing its third profit warning in less than a year with Brexit jitters causing UK consumers to delay holiday plans.
In results for the six months to the end of March, easyJet posted an increased loss before tax of £275m, compared with £68m last year.
The period covers the operator’s off-peak season and was also impacted by the late timing of Easter.
It pointed out the cost per seat increased by 3.9% in the first half after fuel price increases, the impact of currency movements and “the impact of drones at Gatwick in December”.
Moving into the summer, easyJet said that forward bookings for the third quarter were three percentage points behind last year at 72%.
The fall in consumer demand means that revenue per seat is expected to be down in the second half, easyJet said, although it also expected costs per seat to fall too, helped by prior investment to mitigate the impact of flight disruption.
Profit expectations for 2019 were unchanged but it warned that the Brexit delay from 29 March until 31 October could continue to weaken demand into next year.
The company’s half-year report said: “Macroeconomic uncertainty and many unanswered questions surrounding Brexit have together driven weaker customer demand in the market, such that we have seen softness in ticket yields in the UK and across Europe.”
As such, the outlook for the second half “is now more cautious and the Brexit delay may continue to adversely impact consumer demand into FY (fiscal year) 2020”.
EasyJet chief executive Johan Lundgren said: “There wasn’t a big surge or a massive uptick in bookings when the Brexit date was extended.”