EasyJet suffered another grim quarter at the end of 2020 with revenue down by almost 90% but the budget airline said it was holding on for a surge in traveller numbers later this year if restrictions ease.
The airline’s revenues for the last three months of 2020 fell by 88% year-on-year to £165m, it revealed on Thursday. That matched an 87% decline in passenger numbers to just 2.9 million.
Global air travel has been decimated in the past year by both pandemic restrictions and a lack of customer demand, but the rapid creation and approval of vaccines has given airline executives reason to hope that 2021 could be the year when sales rebound.
Polling by easyJet of 5,000 European consumers this month showed that 65% have, or plan to make, a travel booking in 2021.
“We retain the flexibility to rapidly ramp up to capture that demand,” easyJet said in an update on trading.
The return of international travel is likely to be closely linked to the rollout of vaccines but it remains unclear how long it will be until restrictions on movement are lifted. In the UK 7.1 million people had received the first dose of a vaccine by 26 January, and the government aims to have every adult vaccinated by September. The rollout in the EU has been significantly slower.
However, the UK government on Wednesday said travellers would be questioned at airports on their reasons for leaving home, tightening restrictions.
The uncertainty on the timing of any recovery has heightened scrutiny on airlines’ ability to weather further months without the bulk of their revenues. EasyJet said it had halved its costs in the final quarter of 2020 compared with 2019, reflecting deep cuts, less secure seasonal contracts for pilots and furloughed workers across Europe.
Johan Lundgren, easyJet’s chief executive, said the company’s brand, large network of routes, and cheap prices would help it survive.
“Our performance in the period was in line with management expectations, despite more stringent restrictions coming into place,” he said.
“We have taken the right actions to emerge leaner with a reduced cost base and the retrenchment of legacy carriers at key airports will provide additional opportunities for easyJet.”
Shares fell 3% in early trading.