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Friday, April 19, 2024

easyJet confirms $20B Airbus order for 157 additional A320neo family aircraft

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EasyJet, a low-cost airline, confirmed in its most recent trading update that it has placed an order with Airbus for 157 additional aircraft from the A320neo family.

The airline also stated it anticipates its annual profit before tax to range between $541 million (£440 million) and $565 million (£460 million), according to information released on October 12, 2023.

According to the agreement, EasyJet and Airbus have entered into a conditional agreement to secure 56 A320neo and 101 A321neo jet deliveries between 2029 and 2034.

The British-based airline has already placed an order for 158 aircraft from the A320neo family, with delivery scheduled for 2029.

Additionally, EasyJet disclosed that 35 of the A320neo aircraft in the current order will be upgraded to A321neo models.

In addition to the additional 100 purchase rights that were also revealed in the most recent trading update, the carrier currently has 315 aircraft on order for delivery by 2034.

“We have also reached a proposed agreement with Airbus for an additional 157 aircraft order and a further 100 purchase rights. This will enable easyJet’s fleet modernization and growth to continue beyond 2028 while providing substantial benefits including cost efficiencies and sustainability improvements,” Johan Lundgren, CEO of easyJet, said.

EasyJet will be able to replace all of the A319 aircraft in its fleet as well as roughly half of the A320ceo aircraft.

The airline declared that it is in direct talks with CFM International for the supply of engines needed for the anticipated acquisition.

According to the financial update, the cost of the new planes and conversions will be close to $19.9 billion.

EasyJet reported that its passenger traffic increased by 9% in the three months preceding September 30, 2023, generating pre-tax profits of between $799 million (£650 million) and $824 million (£670 million).

Moving into the 2024 financial year, the carrier said booking momentum is continuing and expects Q1 capacity to grow by 15%.

“We have delivered a record summer with strong demand for easyJet’s flights and holidays with customers choosing us for our network, value and service. This performance has demonstrated that our strategy is achieving results and so today we have set out an ambitious roadmap to serve more customers and deliver attractive shareholder returns, underpinned by a continued focus on costs and operational excellence,” Lundgren said.

He added: “Our new medium-term targets provide the building blocks to deliver a PBT greater than £1 billion. This will be driven by reducing winter losses, upgauging our fleet and growing easyJet holidays. As part of our commitment to shareholder returns, the Board intends to reinstate dividends commencing with the FY23 results.”

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