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2mo ago

Jet2 Warns of Rising Costs and Profit Pressures

Higher operational expenses and delayed aircraft deliveries challenge the UK holiday airline's margins despite increased bookings.

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The company’s peak summer activity will be affected by delays to orders of the Airbus A321neo

Overview

  • Jet2 anticipates profit margins will tighten due to inflationary cost increases in hotel accommodations, aircraft maintenance, and airport charges.
  • Delayed Airbus A321neo deliveries will result in additional expenses to cover aircraft gaps during the peak summer season.
  • The company faces £25 million in annual costs from increased employer national insurance contributions and minimum wage hikes, alongside £20 million for sustainable aviation fuel requirements.
  • Bookings for April to June 2025 have risen 7% compared to last year, with flight-only customers increasing by 19% and package holiday customers up 4%.
  • Jet2's shares dropped over 10% after the announcement, reflecting investor concerns over cost pressures and profit guidance below market expectations.