Wizz Air delivers optimistic outlook as summer trading starts well

25th Apr 2024 09:11

(Sharecast News) - Budget airline Wizz Air 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.