Overview
- Jet2 disclosed on Wednesday a £388m favourable fair-value movement in jet-fuel derivatives after market prices rose following the US–Iran conflict.
- The company said customers delayed bookings earlier in the year, which left cash inflow down 67% to £77m for the year to March.
- Demand has since rebounded with Jet2 selling 19.9m summer seats, increasing seat capacity by 8% to 24m and flying 20.8m passengers, while revenue rose to £7.5bn and profit before tax fell to £551m.
- Management announced a new £250m share buyback that it says reflects strong liquidity and confidence in the medium-term outlook despite higher costs from employment taxes and sustainable aviation fuel premiums.
- The derivatives gain arose because Jet2 had previously hedged fuel at lower prices so the contracts increased in market value when prices spiked, and the airline is expanding operations at Gatwick and Luton while reporting some longer immigration queues under the EU EES but no flights left behind.