Fuel bill extends Easyjet losses

Easyjet says its planes are more fuel-efficient than those of many rivals

Budget airline Easyjet has seen first-half losses more than treble as the price of oil soars.

For the six months to 31 March the firm made a loss of £57.5m, including £9.1m of costs from its purchase of GB Airways, against £17.1m a year ago.

Fuel costs in the April to September are set to increase by at least £45m, the airline added.

Easyjet said its fuel bill would also rise by an extra £2.5m for every $10 rise in the price of a barrel of oil.

'Emerge stronger'

The airline said that passenger numbers in the first half of the year rose by 15% to 18.9 million. Revenue grew 24% to £892.2m.

The airline usually makes a loss in the first half of its financial year, making profits in the busier summer months.

Forward bookings for this summer were "slightly" ahead of last year, it said.

If these fuel increases are maintained, many of our weaker competitors will disappear or downsize Andy Harrison, Easyjet chief executive See Easyjet's share price

Chief executive Andy Harrison told the BBC that there was "no indication" that people were cutting spending on flights, despite the economic slowdown.

The upbeat outlook pushed up the firm's shares in early trading - though the shares have lost more than 50% in the past six months.

The price of jet fuel has risen 35% over the past three months and is now 80% higher than last year, Mr Harrison said.

However, he argued that this would have more impact on competitors than on Easyjet.

"Nobody knows how much of this increase is driven by short-term financial speculation and how much is a longer-term sustainable increase," he added.

"What is certain is that if these fuel increases are maintained, many of our weaker competitors will disappear or downsize and Easyjet will emerge even stronger, reflecting the combination of our business model, our cost advantage, our new fuel-efficient fleet and the strength of our network."