These comments and this unexpected departure which caused EasyJet to fall on the stock market

These comments and this unexpected departure which caused EasyJet to fall on the stock market
These comments and this unexpected departure which caused EasyJet to fall on the stock market

That EasyJet posted a pre-tax loss of 350 million pounds (408 million euros) in the first half is not a surprise, the carrier had guided market expectations in mid-April by indicating that it would a deficit of 340 to 360 million. That EasyJet delivers forecasts for the summer – which corresponds to the fourth quarter of its fiscal year – is more cautious. By punishing the title of the low-cost airline with a fall of 7.8% this Thursday, the largest in seven months, the market clearly expressed its discontent. “ Comments on Q4 unit revenues could disappoint », Notes Gerald Khoo, analyst at Liberum. While he was counting on income “ well in advance “, the management of EasyJet, through its general director Johan Lundgren, now expects them to be ” slightly increasing “.

One less degree of certainty which is expensive on the stock market. All the more expensive since, to date, only 39% of the summer program has been completed. “ There is still too much capacity on the market “, declared the leader during an interview granted to Bloomberg TV. The comments come after rival Ryanair’s CEO Michael O’Leary said he expected lower prices than he had hoped for this summer. If EasyJet has managed to compete with national companies like British Airways, some observers question its growth potential in a mature market where more and more airports are limiting the number of spots available. “ Much to the frustration of some investors, Johan Lundgren refused to abandon his strategy during the pandemic and take on Ryanair and Wizz Air to capture market share in new countries during the disruption that affected the entire sector », notes an article in FT. It has preferred to focus on its travel package offering, EasyJet Holidays, which has admittedly seen meteoric growth and generated a quarter of pre-tax profits in its last financial year.

Continuity

Is it this tactic that costs Johan Lundgren his place today? After seven years at the head of EasyJet, the 57-year-old manager, who piloted the company during the turbulence of Covid-19, will leave the group on January 1, 2025. The change being part of continuity, it is internally that his successor has been found, in the person of current financial director Kenton Jarvis. The latter joined EasyJet in 2021, after leading the airline business of travel company TUI. “ Although common in the United States, CFOs rising to the CEO position are less common at European airlinesnote Bernstein analysts. In our opinion, Kenton Jarvis should be seen as representing a continuation of the existing strategy. » « There are still important things to accomplish until the end of the year, but when the time comes, I will leave EasyJet with a great sense of loyalty and pride in the progress made “, said Johan Lundgren. He will remain with the company until the end of his notice period on May 16, 2025.

CP

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