EasyJet profits nosedive 65% as rising unemployment takes its toll

Budget airline easyJet has warned of a 'tough winter' ahead after profits plunged 65 per cent on the back of rising fuel costs and unemployment.

The carrier posted underlying pre-tax profits of £43.7million for the year to September 30, compared with £123.1million in 2008, but pointed out it was one of the few carriers to make a surplus in the recession.

The firm said it was an 'extremely resilient' performance in the circumstances, but predicted a 'tough winter' as rising unemployment takes its toll on demand.

Back to earth: Rising unemployment and high fuel costs have hit profits at easyJet

Back to earth: Rising unemployment and high fuel costs have hit profits at easyJet

EasyJet said it expected a 'substantial' improvement to profits next year as capacity improves and it benefits from the effect of hedging on fuel prices.

The airline's 2009 profits - which were in line with its predictions - were hampered by a double whammy of higher fuel costs and lower income.

Chief executive Andy Harrison said: 'This is an extremely resilient performance, making easyJet the best-performing European airline based on our robust yields.

'We are one of the very few European airlines to make a profit during the last 12 recessionary months.'

But he said the next few months would be difficult.

'We are focusing our efforts on further cost savings and efficiency improvements together with optimising route profitability and aircraft allocation,' he added.

EasyJet carried more passengers in the year - up 3.4 per cent to 45.2million - and the firm said its European short-haul position had strengthened in the period, with gains in Paris, London Gatwick, Milan and Madrid.

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