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EasyJet to land £200m as budget airlines fly higher
05.10.07
Easyjet profits have soared by more than 50% and will top £200 million this year as European airline passengers continue to defect to the budget carriers.
Despite tax attacks on travellers, such as Gordon Brown's £2 billion passenger duty, and the green lobby's warnings over air travel, easyJet today reported that over the past year it carried 37.2 million people throughout Europe, 4.2 million or 13% more than in the previous year.
The carrier has attracted passengers by cutting fares by an average of 6.8% over the past 12 months but has increased revenues by charging for bags, selling food and drink more vigorously on its planes and getting its customers to buy its car hire and hotel packages.
As easyJet spreads its wings - it has concentrated on expanding in Italy and Spain and new services will make it France's leading budget carrier - unit costs have fallen 10%.
"We have achieved significant improvement in margins despite the doubling of air passenger duty in the UK and record fuel prices," said chief executive Andy Harrison.
The airline had already told analysts to expect profit growth of up to 50% in the year to end-September.
Those earnings, easyJet said today, will actually grow by more than half again for the second year running after it reversed the write-off of its investment in the part-privatised air traffic controller Nats.
It has re-valued its 6% stake in Nats at £11 million, having written off its initial investment of £7 million five years ago when Nats was bailed out by the Government.
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Much of Friends of the Earth's campaign on aircraft pollution has been centred around plans to expand Heathrow airport, where easyJet does not fly. But the general issues regarding Friends of the Earth's claims about the environmental impact of flying can be accessed by clicking here
Another major pressure group lobbying on the issue of the expansion of air travel is:
www.planestupid.com
For the airlines' view, click here
