Wizz Air: European budget airline to axe 45 aircraft next year as it faces 'difficult operating conditions'
Wizz Air has narrowed its profit forecast - and expects to ground 45 aircraft next year due to "difficult operating conditions"
European budget carrier Wizz Air has narrowed its annual profit forecast on Thursday (9 November) citing difficult operating conditions. The low-cost carrier said it now expects net income guidance to come in at a range of €350-400m (£305m-£348m) down from a June target of €350m-450m.
The airline announced that it would be forced to ground 45 aircraft by the end of next year as a result, close to a third of its 187-strong fleet. The forecast has come despite the airline carrying a record 33 million passengers in the six months to October, a 24.6% increase.
The firm also increased its revenue to €3.05bn, a 39.1% increase, and profit for the period was up 4.3% to €400.7m. Neil Shah, Executive Director of Content & Strategy at Edison Group commented that Wizz Air’s management “has been strong, reflected in the 20.2% boost in cash balance, now totalling €1.8 billion”.
Wizz Air was one of the main airlines hit by issues with RTX engines this year and had said it would face a capacity reduction as a result. That knocked its net income guidance for the financial year.
Chief executive Jozsef Varadi said in a statement that the guidance reflects expectations for the second half of its financial year to March 31 in the face of macroeconomic uncertainty and difficult operating conditions from an infrastructure and security perspective. He added: “We remain well protected against volatile fuel costs and foreign exchange movements via a systematic hedging programme, and our strengthened operations and a renewing fleet continue to deliver efficiencies for the business while reducing unit costs. Our continued ability to manage the impact of complicated issues gives us the confidence that Wizz Air has the strategy and expertise to achieve our profitable growth ambitions.”
The airline's rival Ryanair recently announced its forecast which included record full-year profits on the back of rising ticket fares and strong demand. Ryanair recorded a total revenue of €8.58bn (£7.43bn) in the six months to the end of September. Passenger numbers also reached more than 105 million across the half year due to a "strong" Easter and record summer demand.
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