Coronavirus: EasyJet losses could hit £380m after jets grounded

EasyJet expects to report a loss of up to £380m for the first half of its financial year after grounding its entire fleet because of coronavirus.

The airline will incur significant fuel costs because it has already bought jet fuel for its planes, with no certainty of when they will fly again.

EasyJet’s chief executive, Johan Lundgren, said the airline had been performing well before the outbreak.

But the company now faces “significant increases in disruption costs”.

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EasyJet forecasts that pre-tax losses for the six months to the end of March will reach between £360m and £380m, mainly because of fuel costs.

The airline said: “At this stage, given the level of continued uncertainty, it is not possible to provide financial guidance for the remainder of the financial year.

“However, we continue to take every step necessary to reduce cost, conserve cash burn, enhance liquidity, protect the business and ensure it is best positioned for a return to flying.”

EasyJet grounded its jets on 30 March, a week after Prime Minister Boris Johnson announced the UK Covid-19 lockdown.

The company had a full roster of pilots and staff during that period when many flights were being cancelled, leading to a rise in costs.

It also only started furloughing staff after the end of March.

EasyJet has reduced costs through a number of measures, including deferring the delivery of 24 new aircraft from planemaker Airbus.

It said it had a cash balance of around £3.3bn and based on a number of scenarios, it would have enough reserves to “remain liquid”, should its jets stay grounded for a number of months.

But it said: “Additional government support could be sought around extended furlough leave and tax relief. Further operational and organisational changes could be made.”