Low-cost airline Wizz drops to half a billion in losses after “most difficult year in history”

Wizz Air CEO József Váradi said: “It was probably one of the most difficult years for the aviation industry. Photo: Reuters

Wizz Air’s (WIZZ.L) revenue has been hit hard and has warned of even more losses in the future as the pandemic takes a heavy toll on the travel industry.

The company recorded a net loss of 576 million euros (£ 496, $ 702 million) for the 12 months ended March 31. Revenue fell 73% to 739 million euros and the underlying loss for the full year was 482 million euros.

It only carried 10 million passengers during that time, a 75% year-over-year drop.

CEO József Váradi said: “It was probably one of the most difficult years for the aviation industry, heavily impacted by regulations related to COVID-19.”

“The passenger and revenue figures reflect the sharp reduction in capacity throughout the year due to travel restrictions across Europe.”

But he said the company still managed to “keep control of our cost structure, preserve our cash position and maintain our investment grade track record.”

Wizz Air stock fell on Wednesday morning.  Chart: Yahoo Finance France

Wizz Air stock fell on Wednesday morning. Chart: Yahoo Finance France

Going forward, the company is cautiously optimistic about the recovery, which it says started later than it had hoped, as COVID-19 restrictions remained in place longer than expected.

The company expects to steal around 30% of its capacity in the first quarter and “unless we see an accelerated and permanent lifting of the restrictions, we expect a reported net loss” for 2022, Váradi said.

By 2023, it hopes to operate at full capacity.

“We have prepared the company to become an even more formidable player and to take advantage of the next phase of the market opportunities that await it after the pandemic,” said Váradi.

“The investments we have made in our fleet and in our network over the past 12 months will soon bear fruit,” he added.

The company’s shares were down nearly 2% on Wednesday morning.

“The casual low-cost challenger couldn’t escape the heart-wrenching turmoil the pandemic has brought to the airline industry,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.

Read more: UK Gets Green Light to Begin Trans-Pacific Trade Agreement Membership Process

“The Hungarian carrier primarily serves routes to and from Eastern European countries, which have been far from swift in rolling out vaccines, although lighter travel restrictions compared to the UK on place in a slightly more resistant position. “

She said around 50 routes have been added to the schedule, including the addition of Abu Dhabi.

“Expansion into the UAE is a key part of its plan … However, with current full capacity not expected to return until 2023, its lofty ambitions are a point on the horizon for now.”

The UK has introduced a system of “traffic lights” for travel, in which countries are divided into green, amber and red. Britons traveling to Green List countries do not need to self-quarantine on their return to the UK, unless the COVID-19 test they take on the second day after their return is positive.

So far, there are only 12 countries marked “green”, including Portugal, Iceland and Australia. The list is subject to revision every three weeks.

Despite industry calls to expand the list, UK Prime Minister Boris Johnson said last month: “I don’t expect us to add to it very quickly and indeed we will maintain a very, very strict for the foreseeable future. “

Meanwhile, the European Commission has proposed that vaccinated people be exempt from testing or quarantine when traveling from one EU country to another, and the EU also welcomes vaccinated tourists.

Watch: Should I book a vacation in 2021?

Source link

About Natalee Broderick

Natalee Broderick

Check Also

Meghan and Harry ‘keep their diaries free’ to return to UK for Queen’s jubilee, expert says

Royal commentator Neil Sean has said the Duke and Duchess of Sussex are expected to …

Leave a Reply

Your email address will not be published. Required fields are marked *