Wizz Air is gearing up for a strong summer after its first annual profit in three years lifted the London-listed shares of the European budget airline on Thursday.
Hungary-based Wizz has benefited from robust demand as it navigates challenges including flight cancellations last year due to the conflict in the Middle East and engine inspections that grounded parts of its fleet.
“As we enter F25, air travel demand remains robust, with no signs of decline in the near term, supporting an environment of higher yields as capacity remains constrained across the sector,” said CEO Jozsef Varadi.
Varadi said inflationary pressures, rising costs and strained supply chains amid geopolitical instability will continue in the coming year, but efforts to control costs will boost growth and a strong summer season.
The airline expects a net profit of between 500 and 600 million euros for this year. Wizz reported a net profit of 365.9 million euros (396 million USD) for the year ended March 31, after three consecutive years of losses.
The company, which recently celebrated 20 years since its first flight, carried a record 62 million passengers during the year. Shares rose to 2,096 pence and were last up 4.9 percent at 2,060 at 0817 GMT.
“Wizz Air has strong medium-term growth figures, supported by its A321neo order book and exposure to faster-growing markets in Eastern Europe and the Middle East,” RBC analysts said. “We expect 2024/25E to be a supportive environment for fares to rise, and we also see traction for cost leadership among European airlines on a cost per available seat kilometer (CASK) basis, alongside Ryanair.”
Rival Ryanair, Europe’s largest by passenger numbers, earlier this week reported full-year profit slightly above analysts’ expectations, while easyJet reported first-half losses in line with expectations. (USD 1 = 0.9242 euros)
