EasyJet lifts profit by making it simpler for fliers to upgrade

Bloomberg

EasyJet Plc is making it easier for customers to hand over their money.
The UK budget carrier raised its 2018 profit guidance, in part because more passengers are paying extra for allocated seating and check-in bags. That’s been encouraged by a website overhaul that’s made it less difficult to book those options.
EasyJet shares advanced as much as 5.1 percent, the most in five months, after the Luton, England-based company said it now expects full-year pretax profit of between $640 million and 590 million pounds, up from a previous range of 530 to 580 million. Extra fees from check-in bags and allocated seating helped ancillary revenues per seat rise 11.5 percent in the third quarter through June.
EasyJet aims to break even on its Berlin Tegel operations in the 2019 fiscal year, CEO Johan Lundgren said.
Headline losses at Tegel are expected to be about 125 million pounds, more than previous guidance of up to 95 million pounds.
“I’m still very convinced that there will not be any disruption of flying post-Brexit,” Lundgren, who joined EasyJet in December from tour operator TUI AG, said. The European Commission is promising to ensure continued connectivity even in the case of a so-called hard-Brexit, he added, while the carrier is continuing to shore up its European shareholder base to ensure that it can keep operating if ownership rules change.
A UK government white paper published said there may be a deal modelled on an EU-Canada accord that would allow for flexibility on airline ownership. Revenue rose 14 percent to 1.6 billion pounds in the third quarter, boosted by higher fares amid what the carrier described as a “benign competitor environment.” Rivals took up fewer slots from defunct Monarch Airlines than EasyJet expected. There are also “challenges for competitors in France”.
The airline expects warm weather may slow travel demand as people holiday at home in the airline’s fourth quarter, though Lundgren said he doesn’t think the impact will be significant.
At the same time, walkouts by Ryanair Holdings Plc pilots may bolster demand, though there’ll be no “opportunistic” price increases, he said.