EasyJet to launch legal action over strikes as it raises profit forecasts

EasyJet
EasyJet upgraded its profit forecasts despite being hampered by strikes 

EasyJet has said it plans to join rivals in launching a legal complaint to the European Commission over crippling air traffic control strikes as it raised profit forecasts despite a £25m hit from the disruption.

The airline's boss, Johan Lundgren, said he believed there was a case that EU law was being infringed by not adequately protecting flights over France as the Commission's failure to tackle the issue is breaching freedom of movement for Europeans.

EasyJet said it had cancelled 2,606 flights in its third quarter to June 30 due largely to air traffic control strikes, which sent costs soaring by £25m as it has had to compensate customers.

It now expects costs for the full year to rise by around 3pc as a result of the disruption, which has so far been greater than seen during the whole of 2017.

But the airline increased its full-year profit outlook to between £550m and £590m despite the strike impact, thanks to strong overall demand from passengers. That is up from previous guidance of £530m to £580m.

Mr Lundgrun said: "It's been a challenging year so far and we estimate that this will not go away."

It comes after Ryanair and British Airways owner International Airlines Group (IAG) recently revealed plans to join forces for a complaint to the Commission over its inaction over the strikes.

EasyJet said revenues in its third quarter rose by 14pc to £1.6bn, while it flew 9.3pc more passengers at 24.4m over the three months.

Johan Lundgren
Johan Lundgren, boss of EasyJet

The group also revealed that the UK's summer heatwave could hit demand for late bookings in its final quarter, with the recent World Cup tournament also potentially putting some passengers off travelling.

Neil Wilson, an analyst at Markets.com, said EasyJet put in "nothing short of a stellar performance" after "riding out some pretty nasty turbulence in the sector". 

Shares in EasyJet rose 4.3pc in early trade, but slipped back by lunchtime to change hands just 0.7pc higher, at £16.65.

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