THAT people are reluctant to cut back on holidays amid the ongoing inflationary pressures facing the nation is clear from the soaring profits at leisure travel group Jet2. And who can blame consumers for not being prepared to forgo their annual getaway to sunnier climes given this summer’s disappointing weather so far.
The Leeds-based airline and package holiday specialist has created a model that works and has garnered huge customer loyalty on the back of its wide range of Atol-protected packages under its Jet2holidays brand and Jet2.com flight-only options.
Profits soar at Jet2 on back of record passenger numbers
It’s also known for delivering excellent customer services with Jet2holidays recognised by the latest UK Customer Satisfaction Index (UKCSI) and named among the very best companies in the UK for customer service, ranked joint fourth out of more than 200 major brands and organisations.
So perhaps a 43% rise in pre-tax profits to £529.5 million for the year to March 31, as passenger numbers rose by 9% to hit a record 17.7 million, should not come as a surprise. Jet2 also reported revenue of £6.26 billion for the year, up 24% from £5.03bn in 2022/23, and announced a final dividend of 10.7p per share, an increase of 34%.
Jet2’s solid performance came as it revealed prices of its holidays increased by an average of 11% to £830 as it sought to recoup soaring inflation and it warned holidaymakers can expect to see further “modest” increases over the summer months.
The company, which operates two bases in Scotland – Edinburgh and Glasgow – and takes Scots on holidays to popular destinations across Europe, believes that “the end-to-end package holiday is a resilient and popular product which remains high on the priority list for our customers, even during uncertain economic times”.
Jet2 new holiday destination from Glasgow and Edinburgh airports
While analyst Julie Palmer, partner at Begbies Traynor, warns of a “slight concern that momentum could fall” given Jet2’s admission that passengers are booking their holidays much closer to their departure date than they did in past, she noted: “Jet2 has shown why confidence has slowly but surely returned to the aviation industry.
“Like many of its peers, the leisure travel brand has had to contend with cancellations in recent weeks, but the numbers it reported for its full year are encouraging – record passenger numbers and revenues contributing to profits leaping 40%. It is no wonder that Jet2 has chosen to reward shareholders.
“Of course, Jet2 is at an advantage in being primarily a tour operator, with the majority of its seats sold as part of a package holiday. This means it is less exposed to fluctuations in aviation pricing and better able to withstand headwinds compared to some of its peers.”
The group has also invested in new Airbus A321neo aircraft which are more environmentally friendly, and expanded its UK bases with Liverpool’s John Lennon Airport coming on stream in March and operations from its 12th base at Bournemouth Airport set to begin from February 2025.
Jet2 formula a success as leisure group's profits soar
As the Jet2 group’s chairman Robin Terrell states: “We have also remained true to our values of carefully investing to secure our long-term growth aspirations.”
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