easyJet (LSE: EZJ) released a year-end trading update Tuesday, telling us: “Headline loss before tax for the year ended 30 September 2021 is expected to be between £1,135m and £1,175m compared to consensus of £1,175m.”
So it looks like the budget airline has beaten analysts’ expectations. But we will have to wait until full results due on 30 November to be sure. The easyJet share price dipped 2.5% in early trading, on a day when markets opened weakly. The FTSE 250 though was down only 0.5% at the same point.
The big question is whether things are changing. And the fourth quarter does seem to be strengthening. The company says that Q4 headline losses are less than half of the equivalent figures a year ago. And, perhaps crucially, the quarter generated positive operating cash of approximately £40m.
Net debt has fallen from £2bn in Q3, to around £0.9bn. That’s due to September’s rights issue, which raised £1.2bn. Oh, and that caused the easyJet share price to dip sharply too. At 30 September, total liquidity reached approximately £4.4bn.
easyJet set for Q1 growth
In Q4, the fleet operated at only 58% of its 2019 capacity, though that still filled 17.3 million seats. The uptick appears to be carrying forward, with first-half bookings for next year already around twice the level of last year. And easyJet expects first quarter capacity to reach up to 70% of 2019 levels.
Shareholders will receive no dividend this year, which comes as no surprise. There was nothing more about dividends in the update, but I guess we might hear some thoughts when we see the full-year results in November.