Dash to the sun lifted trading at Jet2

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BRITAIN’S summer washout drove more passengers to holiday with budget airline Jet2, helping its owner Dart Group to an expectation-beating first-half performance.

The group, based at Leeds Bradford Airport, said both its holidays business Jet2holidays and its leisure airline Jet2.com increased passengers substantially in the six months to the end of September.

Dart said the “particularly poor summer weather” – which the Met Office called the wettest summer in more than a century – helped Jet2.com to strong trading. It flew 3.6m passengers during the six months, an increase of 14 per cent on last year, with increases in both yields and load factors.

Jet2holidays took 312,000 passengers on holiday during the six months, almost double the 158,000 holiday-makers it carried a year earlier.

“People want to go on holiday and we are providing great value package holidays and we fly to where people go to at the price people want to pay,” said chairman and chief executive Philip Meeson.

“Everyone wants to get out of the rainy North at the moment and into the sunshine.

“Holidays are very important to people and the package holiday is particularly welcome because it gives certainty of spend – we do the flight, transfer, hotel, food and drink. They know that everything is going to go well. We’ve worked hard to get the right product into the market.”

Shares in the group.

The group’s holiday business has grown rapidly since its launch in 2007 and now has 1,200 hotels contracted to it.

From eight bases across the North it flies to “commercial and political risk-free Mediterranean and Canary Islands resorts”, including more than 60 summer routes to Spain alone. However, Dart said its leisure travel business is becoming “increasingly seasonal”, as more people opt to holiday abroad in the summer rather than the winter.

Mr Meeson said the winter skiing trip is increasingly becoming “the holiday they do not have to have”.

“Families do want their summer holidays and people still like winter breaks, but increasingly people are going on one two-week holiday.”

The group said: “This, coupled with strong summer trading, will result in the group’s profit before taxation for the first half of the year being ahead of the same period in the previous year, with increased losses expected in the second half,” it said.

“Notwithstanding the current economic climate, the board expects to exceed current market expectations for the year ending March 31, 2013.”

Mr Meeson said this “seasonality” means its fleet of 45 aeroplanes is flying fewer miles in the winter.

In line with other airlines such as Ryanair, Dart has trimmed its winter schedule.

“We’re very careful how we fly our aeroplanes and we only fly them when they’re full,” he said.

Its Fowler Welch distribution business, which supplies major retailers with chilled and ambient goods, is “trading in line with expectations in a sector that continues to experience tight margins”.

“What’s very difficult is to get price rises,” said Mr Meeson. “Fuel costs are passed on... but other prices are difficult to pass on as they are in aviation.”

Analyst Peter Ashworth, at Charles Stanley stockbrokers, said: “In light of this update we anticipate a rally in the shares.”

Current market forecasts are for full-year pre-tax profits of about £30m and earnings per share of 16p, he added.