EasyJet to beat yearly profit forecasts, shares up

British budget airline easyJet reported strong September passenger numbers and said it would beat its previous profit estimate for the year after a written-off investment in air traffic control outperformed.

EasyJet, Europe's second-largest budget airline by market value after Ryanair, said passenger numbers had risen 14.2 per cent year-on-year in September to £3.4 million.

Its shares jumped 4.1 per cent to 570 pence by 0933 GMT, valuing the company at around £2.4 billion.

"With the financial year now completed, we expect pretax profit growth to be towards the top end of our earlier guidance of 40 per cent to 50 per cent," it said in a statement yesterday.

Finance director Jeff Carr said the increase was largely due to expansion in Europe, especially Milan and Madrid.

Analysts at Deutsche Bank said the figures showed that apparent weakness in easyJet's summer passenger figures was caused by the difficulty of beating very strong numbers from the summer before - and not by any downturn.

Rival Ryanair has repeatedly warned that airlines are facing tough markets.

"We don't think there was a drop-off in demand," Mr Carr said. "We see the UK wanting to fly if we offer the right prices."

Deutsche analysts said: "We continue to think a winter of tighter credit, high oil and competition should favour the bigger, better branded airlines in which we would include easyJet".

EasyJet said overall pretax profit growth would exceed earlier estimates after accounting for the one-off £11 million gain from easyJet's investment in The Airline Group, a consortium handling air traffic control in the UK.