Revenues top £3.1bn as Jet2.com’s owners fly high

Dart Group, the owners of Jet2.com and Jet2holidays, has this morning reported its annual revenues hit £3.1bn as it is hailed the success of its leisure travel products but warned that “less confident consumers” are booking flights and holidays later.

The listed company has this morning published its annual results for the year ended 31 March 2019. Its revenues rose 32%, from £2.3bn in 2018 to £3.1bn in 2019. The listed group’s pre-tax profits grew by 36%, from £130.2m to £177.5m.

Dart said its performance reflected the growing success of it leisure travel products – flights with Leeds-headquarterted airline Jet2.com and package holidays tour operator Jet2holidays – which had led to “continuing strong customer demand for both.”

During the year, Jet2.com flew a total of 12.8m flight-only and package holiday passengers (2018: 10.3m). Its flight-only service was used by 6.4m passengers – a growth of 21%.  Jet2holidays took 3.1m customers on package holidays (2018: 2.5m) – an increase of 27%.

The company said that Summer 2018 “proved to be a particularly strong season,” with demand “buoyant throughout.”  Dart added: “However, the favourable trading conditions gave way to a more uncertain consumer environment in the second half of the year, which led to increased levels of price discounting to achieve the planned growth in customer volumes.”

The company said that the average flight-only ticket yield per passenger sector stood at £81.79 during the year – up 12% from £73.01 in 2018. Average load factors increased to 92.8% (2018: 92.2%) against a 23% increase in seat capacity.

Its distribution and logistics division saw pre-tax profit reduce by £100,000 to £4.3m. Dart added that its revenues in the division had improved – rising to £178.7m from £168.6m in the previous year.

Dart said that its operating losses for the second half of the year had increased, as it continued to invest in additional aircraft and marketing. It added that there was also the increasing cost of retaining and attracting staff in readiness for its expanding Summer 2019 flying programme.

Chairman Philip Meeson said: “Though overall demand for our leisure travel products has continued to strengthen since the start of the new financial year, it is clear from our forward booking trends that generally, less confident consumers are booking later than last year and therefore pricing for both our flight-only and package holiday products has to be continually enticing. Nevertheless, with still some way to go in the booking cycle, the Board remains optimistic that current market expectations for Group profit before foreign exchange revaluations and taxation for the year ending 31 March 2020 will be met.

“Looking further ahead, the Travel Industry in general is facing cost pressures in relation to fuel, carbon and other operating charges which, together with the necessary continued investment in our own products and operations, including that required to attract and retain colleagues, are headwinds that the business faces. However, in the long term we are confident of the resilience of both our Leisure Travel and Distribution & Logistics businesses.

“The Group particularly dedicates significant resources to deliver Real Package Holidays™ and we believe we have the strategy to grow our flight-only and package holiday businesses, with the products, the people and the proposition to go from strength to strength. With our Customer focused approach, we are confident that our customers will continue to be keen to travel with us from our Rainy Island to the sun spots of the Mediterranean, the Canary Islands and to European Leisure Cities.”

The board is recommended an increased final dividend of 7.4p per share (2018: 6p), which will bring the total proposed dividend to 10.2p per share for the year (2018: 7.5p) – an increase of 36%.