EasyJet Shares Soar on Higher Profit Forecast

Europe's second-largest low-cost airline EasyJet forecast a higher-than-expected pre-tax profit for the year ending 30 September, as its strategy to operate flights on routes that rivals have abandoned pays off.

EasyJet's stock price, which has gained more than 80% so far this year, hit an all-time high of 1,449 pence in early trade on Wednesday in London. The stock was trading 3.74% higher at 3:53pm, valuing the company at around £5.49bn pounds.

The airline expects a pretax profit of between £450m (€522m , $690) and £480m in the year to September, up from £317m last year and ahead of the average analyst's prediction of £433m.

The Luton-based airline also reported a 10.5% increase in third quarter revenue, at £1.14bn pounds.

EasyJet increased capacity by 3.6% percent in the three months to 30 June. Revenue per seat grew by 6.1% at constant currency rates at £61.44 per seat. The company said it has benefited from adding flights on routes to Italy and Switzerland.

It also expects its fuel bill for the six months to October to be around £9m less than the same period a year ago, owing to a successful fuel-cost hedging programmme.

"EasyJet has delivered a strong performance in the third quarter in a benign capacity environment. The strong performance demonstrates further progress against the EasyJet strategy" chief executive Carolyn McCall said in a statement. She added that 73% of seats have already been booked for the six months to October.

Earlier this month EasyJet won shareholder approval to buy 135 new Airbus aircraft even with objections from its estranged founder and biggest shareholder Sir Stelios Haji-Ioannou. He had termed the purchase as a "bad deal" owing to the high cost.

Low-cost carriers have been eager to plug gaps left by large airlines such as British Airways and Air France-KLM, which are battling weak economies and rising jet fuel prices.

EasyJet recently introduced flights between London and Moscow, as it continues to spread its network.

Haji-Ioannou started the first pan-African low-cost carrier, FastJet, in 2011. He and his family still own about 37% of EasyJet.