EasyJet shares dive

Shares in EasyJet dived after the no-frills airline warned that Britain’s vote to quit the EU would hurt its business over the coming months.
The British carrier said last week’s referendum result would create uncertainty in the economy and among consumers, impacting its second-half performance that ends in September.
The news sent EasyJet’s share price plunging with a loss of nearly 19 percent at 1,065 pence around midday — making it the biggest faller on London’s benchmark FTSE 100 index, which was down 1.7 percent overall.
“Easyjet is the biggest loser... as the airline industry suffers amidst fears that the rapid depreciation of the pound may weigh on consumer choice when deciding on their upcoming summer holidays,” said David Cheetham, market analyst at traders XTB.
The British pound tumbled Monday to the lowest level in almost 31 years at $1.3194 on Brexit fallout.
EasyJet on Monday said recent changes to exchange rates and higher fuel prices on the back of recovering crude were expected to “add around £25 million ($33 million, 30 million euros) of additional cost” in the current financial year.
The group added in a statement that revenue per seat — a key measure of business efficiency for airlines — would fall by five percent “at least” in the six months to September 30 when compared to the same period last year.
EasyJet said its second-half performance was already being impacted by 1,061 cancelations so far in April-June period because of a French traffic controllers’ strike, congestion at London-Gatwick airport and bad weather.
Combined with the effect of the May 19 crash EgyptAir flight MS804 from Paris to Cairo, in which 66 people were killed, the drop-off in consumer demand had knocked about £28 million off pre-tax profit in the April-June period, it said.
EasyJet’s statement contrasts with one rushed out on Friday in the immediate aftermath of the referendum result, when the airline said it was “confident that it will not have a material impact on its strategy or its ability to deliver long term sustainable earnings growth and returns to shareholders.”

Source: Arab News