EasyJet has reported its first annual loss – the first in the airline’s 25-year history – as the slump in demand continues due to COVID-19 lockdowns and travel restrictions.
The budget airline posted a loss of £1.27bn for the year to 30 September, with revenues more than halved. EasyJet expects to fly at just 20 per cent of its normal capacity into next year.
EasyJet has welcomed news of the roll out of the Pfizer and Moderna COVID vaccines. Chief executive Johan Lundgren told BBC Radio 4’s Today programme that the COVID vaccines will be “a very critical part of the recovery.”
Lundgren reflected calls from BA boss Sean Doyle and Ryanair’s Michael O’Leary for faster implementation of testing and less reliance on blanket quarantine measures to open up economies and aid with COVID recovery. He added: “I don’t think it’s only about the vaccine, I think it’s also about the fact that we need to have testing in place, we need to have also refined development of the quarantine system.”
Bookings up 50 per cent after vaccine announcement
Lundgren added that underlying demand was strong for air travel: “We know that people want to travel. On the news of the vaccine last Monday, bookings were up close to 50 per cent, so it just gives evidence to the fact that any good news that comes out of here makes people more confident making bookings going forward.”
EasyJet’s revenues have plunged due to government travel restrictions and national lockdowns in most of its markets. The airline grounded its entire fleet for 11 weeks. The airline did record some recovery in demand during the easing of lockdowns over summer but suffered when widespread quarantine restrictions were imposed again from September.
The airline has been making use of UK government support and will be extending it borrowing under the Corporate Finance Facility with staggered repayments. The airline borrowed £600m in April.