Airline Jet2 has told shareholders it expects to report a loss of up to £385m as the Covid-19 pandemic continues to bite.
The Leeds based business issued a trading update for the year ended March 31 2021, saying the board expects it to swing from last year’s pre-tax profit of £264.2m to a pre-tax loss from continuing operations of between £375m to £385m.
The firm said that during the year it took “swift and decisive action” to raise close to £1bn from a range of sources to mitigate the impacts of the pandemic.
In February Jet2 raised £422m on the stock exchange with a shares placing and subscription.
As a result, it said it was in a strong cash position as of March 31 2021, with unaudited total cash of £1.379bn and “own cash” (excluding advance customer deposits) of £1.062bn - 104% up on last year’s £520m.
It added: “This was after promptly returning over £1.3bn of customers’ deposits for which we were commended by both the 海角视频 Civil Aviation Authority and Which?”
Despite the loss, Jet2 said it is encouraged by the continuing successful rollout of vaccines in the 海角视频 and the increasing momentum in Europe, and that it welcomed confirmation from the 海角视频 Government’s Global Travel Task Force that international travel remained on track to reopen in mid-May.
But it used the update to highlight its disappointment over the lack of detail on the task force’s ‘traffic light’ travel system - which led to it suspending more flights.
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It said: “However, we were disappointed at the lack of clarity contained in the Task Force’s report, in particular the as yet to be populated ‘traffic light’ framework for destinations, and full details and cost of the associated testing regime.
“This means the impact and duration of the proposed Covid-19 travel restrictions for Summer 21 remain difficult to determine and due to this continued uncertainty, in fairness to all our stakeholders and especially our Customers, we took the difficult decision to extend the suspension of our flights and holidays from 17 May up to and including 23 June, by which time we are expecting more clarity.
“Both pre-pandemic and throughout the last 12 months, our airline, Jet2.com, has demonstrated a high level of operational flexibility by responding rapidly to evolving market conditions generating cash in doing so, and we retain that flexibility to react quickly as travel restrictions change.
“Unsurprisingly given the short-term uncertainty, customers are booking significantly closer to departure for Summer 21. However, we continue to be encouraged by the volume of customer bookings for both Winter 21/22 and for Summer 22, for which package holiday bookings are displaying a materially higher mix of the total.”
The firm added that it is confident that once normality returns, customers will be determined to seek out Jet2 holidays.
Shares rose slightly by 1.31% to 1,434p following the stock announcement.