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For bidder Castlelake, easyJet is full of buried treasure

The struggling airline reported a £552 million pre-tax loss but holds £5 billion in aircraft assets

June 5 2026, The Times

EasyJet’s self check-in area at Gatwick’s north terminal is, on a summer holiday weekend, a small wonder of the modern world. There are 48 automated desks spread over 5,000 square feet, making it the largest facility of its kind. It can send 4,500 people an hour whizzing towards their pre-flight pint at the Red Lion, the Wetherspoons pub a short stroll from security.

All that efficiency, however, does not translate into mega profits, or impress the City. In the six months to the end of March, easyJet made a pre-tax loss of £552 million. It normally loses money over winter, but the seasonal losses are getting worse. The deficit was £158 million more than at the same point the previous year. The number of seats it filled — its load factor, as the aviation geeks like to say — was up, from 88.6 per cent to 90.5 per cent. But the benefit of the extra passengers was lost to a combination of weak prices and higher costs.

EasyJet’s

The Iran conflict and oil price volatility have hammered both easyJet and Ryanair this month — easyJet down ~20%, Ryanair ~10%. Knee-jerk reactions like this often throw up opportunities for investors willing to look past the noise. So which is the better bet?

Ryanair's smaller drop reflects its dominant market position and stronger balance sheet, plus easyJet's likely FTSE 100 exit — an automatic sell trigger for many institutions. O'Leary's reputation as a tough negotiator matters when so much is uncertain: fuel costs, fares, airport fees and taxes. Ryanair sticks to cheaper airports, runs a single Boeing 737 fleet to cut maintenance and training costs, and keeps planes full and flying. Ancillaries — bags, check-ins, legroom — make up a third of revenue, versus ~30% at easyJet.

On the demand side, both have a solid base to work from. EasyJet reported its best-ever January booking period, with 47% of holidays sold for H2 and 22% of standard seats. Ryanair says 2026 bookings got off to a strong start. The shift toward advance purchases — partly to dodge dynamic pricing — has helped lock in revenue before the Gulf situation escalated.

Fuel hedging covers most of this year's consumption for both, though those early bookings limit their ability to pass on the latest oil spike. EasyJet has ~300 Airbus A320neo jets on order (20% fuel saving per plane), while Ryanair is awaiting a similar number of more efficient 737 Max variants arriving from next year.

EasyJet targets popular airports like Geneva, drawing business travellers and wealthier holidaymakers. Ryanair, with 600+ planes and ~208 million passengers forecast for the year to April, is simply the scale leader — cost per available kilometre of 4.5 euro cents vs easyJet's 7 cents. Profit guidance for this year is €2.13–2.23bn, up a third on last year, with a net margin of ~15% versus easyJet's ~12%.

Ryanair is virtually debt-free by May and prefers buybacks over dividends. EasyJet offers a prospective yield of 2.8% this year and 3% next — better for income seekers.

Advice: Buy easyJet, Hold Ryanair. Ryanair has greater all-round strength, but easyJet's share price fall looks overdone.

BP has been the ugly sister of UK oil investing for 16 years, and the reason is simple: debt. The Deepwater Horizon disaster in 2010 sent net debt spiralling from $26bn to $45bn, and the company has been paying for it ever since — literally, with $1.5bn in claims still due this year alone.

Add the Rosneft writedown to zero post-Ukraine, and you can see why the shares are still 10% below their April 2010 peak.

But things are shifting. Net debt is now down to $22.2bn with a target of $14–18bn by end of 2026, driven by $20bn in asset sales — $11bn already done. The $7bn/year buyback is gone, renewables ambitions quietly shelved, and the cost-cutting target has been raised to $6.5–7.5bn. It's brutal, but it's working.

New CEO Meg O'Neill takes the reins on April 1st and inherits a leaner machine. At $78/barrel, BofA estimates a ~$10bn cash boost, with EPS potentially up 24% to ~40p. That puts the shares on 14x forward earnings with a 4.3% yield.

The advice is Hold — but for patient longs, the risk/reward is finally starting to look more interesting.

Conclusion

ITV plc is a company mid-metamorphosis. For the global investor, it represents a high-yield opportunity with significant "hidden" value in its Studios arm. However, the investment requires a belief that the "digital hedge" provided by ITVX and the global demand for content can outpace the terminal decline of the linear television model. In the short term, the 2026 World Cup and continued cost-cutting offer a margin of safety; in the long term, ITV must prove it can survive as a content creator in a world that no longer "tunes in" to a schedule.

ITVX Performance: The streaming platform has exceeded all internal KPIs, providing a high-margin digital advertising (AVOD) revenue stream.

Cost Discipline: The group delivered £63 million in permanent cost savings in 2025, with another £20 million targeted for 2026, demonstrating "ruthless efficiency."

Recouped Investment: Having recouped the ITVX investment four years early significantly de-risks the digital transition.

IP Ownership: Control over unique IP (e.g., The Voice, Love Island) allows for multi-territory monetization and licensing.

Sports Rights Hub: As the sole commercial broadcaster for the expanded FIFA Men’s World Cup and Six Nations, ITV remains the "go-to" for advertisers seeking mass-reach "live" audiences.

Strong Balance Sheet: A leverage ratio of 1.0x net debt/EBITDA provides ample "dry powder" for bolt-on acquisitions or shareholder returns.

Digital Ad Yields: Digital advertising typically commands higher CPMs (cost per mille) than linear, as data-driven targeting improves advertiser ROI.

External Revenue Growth: 10% growth in external Studios revenue shows strong demand from global streamers (Netflix, Amazon, Apple) who lack their own production infrastructure.

Attractive Yield: A ~7% dividend yield, backed by ~80% profit-to-cash conversion, offers significant income support while waiting for a re-rating.

The Investment Case: 10 Negative Drivers

Linear Erosion: The structural decline in traditional TV viewing is accelerating, particularly among the "hard-to-reach" under-45 demographic.

Advertising Volatility: Total Advertising Revenue (TAR) remains hyper-sensitive to the UK macro-economic climate and consumer sentiment.

Content Arms Race: To compete with global streamers, ITV must maintain high levels of content spend (£1.2bn+ annually), which pressures margins.

Margin Pressure in Studios: As revenue mix shifts toward higher-end scripted drama, margins are expected to sit at the lower end of the 13-15% range.

US Market Softness: Phasing issues and delivery delays in the US market (often due to labor strikes or platform consolidation) can cause lumpy earnings.

Concentration Risk: Despite diversification, ITV remains heavily reliant on a few "mega-hits" to drive both its production and broadcast divisions.

Crowded Streaming Market: ITVX faces intense competition for eyeballs; maintaining MAU growth requires constant, expensive marketing and content refreshes.

The "Sky" Factor: Ongoing discussions regarding the potential sale or partnership of the M&E (Media & Entertainment) business create uncertainty around the group’s long-term perimeter.

Valuation Trap: ITV has traded at a "perpetual discount" for years; without a clear catalyst (like a full takeover bid), the share price may remain stagnant.

Currency Headwinds: As a global producer, ITV is exposed to FX fluctuations (notably a £15m revenue impact in 2025), which can complicate reported growth.

The ITV Transmutation: Can a Content Powerhouse Outrun the Linear Decay?

For decades, ITV was defined by the "heartland" of British television—a reliable, if unremarkable, engine of mass-market advertising. But as the 2025 fiscal year results confirm, that company no longer exists. Under Chief Executive Dame Carolyn McCall, ITV has undergone a fundamental structural shift, with two-thirds of its revenue now derived from its production arm, ITV Studios, and its digital streaming business, ITVX.

The central question for global investors in 2026 is no longer whether ITV can save "linear" TV, but whether its high-growth segments can scale fast enough to offset the inexorable erosion of the traditional 30-second spot.

The Financial Scorecard

The 2025 results revealed a "resilient but transitioning" balance sheet. Group total revenue remained flat at approximately £4.12 billion. However, this mask-like stability hid significant internal movement: a 5% growth in ITV Studios and 10% growth in digital revenues served as a vital bulwark against a 5% decline in Total Advertising Revenue (TAR).

While adjusted EBITA dipped slightly (1%) to £534 million, the group managed to maintain an EBITA margin of 15.2%. The statutory profit figures told a more volatile story, with profit before tax falling 35% to £338 million—though much of this was attributed to the one-off impact of the prior year's BritBox International sale.

The "More Than TV" Strategy

The 2026 outlook hinges on the success of the "More Than TV" initiative. ITVX has emerged as the clear victor of this strategy, recouping its total investment four years ahead of schedule. With monthly active users (MAUs) and streaming hours seeing double-digit growth, ITV has successfully built a digital platform that can compete for the attention of younger demographics, albeit in a crowded field dominated by US behemoths like Netflix and Disney+.

Conversely, ITV Studios—now a global top-tier producer—is increasingly acting as an arms dealer to those very same rivals. By producing hits like Love Island and Line of Duty for third-party platforms, ITV has diversified its risk away from the UK advertising cycle.

The Dividend Dilemma and Valuation

Investors are currently faced with a valuation that sits comfortably below its ten-year average. With a forward P/E ratio hovering around 7.5x-8.0x and a dividend yield of approximately 6-7%, ITV is priced as a "value" play rather than a growth stock. Management’s commitment to a 5.0p total dividend suggests a confidence in cash generation, but the market remains wary of the high capital expenditure required to keep the content machine humming.

The Investment Case: 10 Positive Drivers

Studios Scale: ITV Studios is now one of the largest independent producers globally, providing a natural hedge against UK-specific economic downturns.

ITVX Performance: The streaming platform has exceeded all internal KPIs, providing a high-margin digital advertising (

ITV Studios would be a layup for them; they got 2.2 billion just for calling off that terrible Warner deal.

HOLD RYN BUY EZJ

This is gonna fly, past 2023 time will tell, there is going to be an incredible opportunity to get back into IAG under 400. BA are a winner and loser here. A LOT of people will want to fly direct to India and the Far East rather than take the cheap option through the GULF, they lose due to Oil prices, but they will have hedged. I'm back into IAG under 400 and will hold tight here, 525 weeks end?

ITV is a decent business worth more than 80p. Right now this and other well run companies (despite what people think about the "Dame") are targets for investment for funds looking to rotate from the states. https://www.reuters.com/business/finance/blackrock-ceo-buying-undervalued-uk-assets-times-reports-2025-04-24/

1. Stake-building by an institutional investor

This is a strong possibility.

Institutions often accumulate stakes during auctions to avoid moving the market price.

Gradual increases over multiple days may indicate stealth accumulation.

2. Stake reduction or exit

It could also be someone reducing or exiting a position.

If ITV is in play for M&A speculation or after earnings, someone might be rotating out.

3. Index rebalancing or ETF flows

ITV may be part of an index like the FTSE 250 or FTSE All-Share.

Periodic rebalancing can trigger large uncrossing volumes, even if no one is deliberately building a stake.

4. Corporate action, rumors, or news flow

Unusual volume can precede M&A activity or activist campaigns.

Someone might be preparing for a move (acquisition, takeover defense, etc.).

Compare with average volume: ITV’s average daily volume is usually below 10 million shares, so 26 million in a closing auction is way above normal.

My top-up at 380 looks optimistic now, oops. I might try and remortgage if these go under 300! OPEC will step in and trim supply if the price keeps falling, so no worries there. If these falls continue, Trump will fold by Friday, and he is a lame duck for three years. If SPY hits 400 I am buying SPY 450 December calls.

It's not going to be a great day, but nothing much changed for ITV in a week, so just chill or top up.

Looks like I was a bit early to the party. Yikes!

We went ex divi today no?

# EasyJet FY24 Earnings Outlook: Positive Summer Demand Drives Optimism Amid Challenges

EasyJet's latest financial update reveals a complex picture as the airline navigates its post-pandemic recovery. While the carrier has reported several encouraging metrics, some challenges remain. Here's a breakdown of the key positives and negatives from easyJet's FY24 outlook.

### Positives

1. **Strong Summer Demand**: EasyJet anticipates a robust summer demand that is expected to deliver strong earnings growth for FY24, buoyed by an uptick in passenger volumes and yield improvements.

2. **Reduced Winter Losses**: The airline reported a headline loss before tax of £350 million, a significant £61 million year-over-year improvement driven by a 12% increase in capacity and stable unit costs excluding fuel.

3. **EasyJet Holidays Growth**: The holiday segment saw a 42% increase in customer growth year-over-year, contributing to a substantial rise in profitability.

4. **Healthy Balance Sheet**: EasyJet boasts a net cash position of £146 million as of 31 March 2024, supporting future growth and shareholder returns.

5. **Capacity Expansion**: The airline plans to increase its capacity to approximately 100 million seats in FY24, reflecting a proactive approach to meeting anticipated demand.

6. **New Aircraft Deliveries**: EasyJet remains on track with its fleet expansion, expecting 16 new A320neo family aircraft deliveries in FY24, enhancing fuel efficiency and capacity.

7. **Strategic Acquisitions**: The purchase of a heavy base maintenance facility in Malta is set to provide supply certainty and unlock cost benefits.

8. **Expansion of Bases**: The successful launch of bases in Birmingham and Alicante, with load factors exceeding network averages, and the announcement of a new base at Southend set to open in summer 2025, underscore easyJet's growth strategy.

9. **Positive Revenue Growth**: Total revenue increased by 22% to £3,268 million, driven by higher capacity and strong ancillary products, including easyJet holidays.

10. **Sustainability Initiatives**: The airline has made strides in sustainability, with more than a fifth of its fleet now comprised of highly efficient NEO aircraft and successful trials of hydrogen refueling at UK airports.

### Negatives

1. **Persistent Losses**: Despite improvements, easyJet still reported a significant headline loss before tax of £350 million for the first half of FY24.

2. **Rising Fuel Costs**: Fuel costs per seat increased by 6% year-over-year, reflecting volatility in fuel prices and contributing to the overall cost increase.

3. **Load Factor Decline**: The load factor slightly declined to 86.7% from 87.5% in the previous year, indicating some inefficiencies in capacity utilization.

4. **Exchange Rate Impacts**: Foreign exchange movements have had a negative impact, with a £6 million loss due to currency fluctuations.

5. **Inflationary Pressures**: Inflationary cos

Great comment, everyone has to take the share issue into account before imaging sky-high pre-COVID-19 prices. 300p seems lofty but at the VERY least 220 which it was DURING the pandemic when there wasn't a plane in the sky. I'd take 233. As I'm in here at 133

Summary of ITV's Q1 2024 Trading Update

Highlights:

ITV is on track to meet its 2026 KPI targets.

ITV Studios Q1 revenue decreased by 16%, primarily due to delivery phasing and the US writers' and actors' strike.

ITVX, ITV's streaming service, saw a 16% growth in streaming hours and a 14% increase in digital advertising revenue.

Total advertising revenue increased by 3% in Q1 and is expected to rise by 12% in Q2, with H1 forecasted to see an 8% increase.

The ITV Pension scheme is now in surplus, removing a historic drag on free cash.

Five Positives:

Digital Growth:

ITVX demonstrated strong performance with a 16% growth in streaming hours and a 14% increase in digital advertising revenues in Q1.

Advertising Revenue:

Total advertising revenue grew by 3% in Q1 and is projected to continue its strong momentum with a 12% increase in Q2 and an 8% rise in H1.

Pension Surplus:

The ITV Pension scheme is in surplus following the latest valuation, removing a significant historic drag on free cash.

Cost Savings:

ITV’s cost savings programs are on track to deliver £40 million in savings for 2024, aiding financial efficiency.

Strong Content Pipeline:

Despite revenue challenges, ITV Studios has a robust pipeline of programs expected to boost revenue in the second half of the year.

Negatives:

Revenue Decline:

Total revenue fell by 7% in Q1 to £887 million, with ITV Studios revenue dropping by 16% due to the phasing of deliveries and the impact of the US strikes.

Non-Advertising Revenue Decrease:

Total non-advertising revenue decreased by 15%, driven by a decline in partnership revenue and other factors.

ITV Studios Impact:

The US writers' and actors' strikes and weaker demand from European broadcasters significantly impacted ITV Studios revenue.

External Revenue Drop:

Total external revenue decreased by 6% to £727 million compared to Q1 2023.

Share of Commercial Viewing:

ITV's share of commercial viewing decreased slightly, with 91% of the top 1,000 commercially broadcast TV programs compared to 93% in the previous period.

Didn't think they would be filled so let's see. No one can be upset at this pullback, what is this up over the last 3 month! a bit of profit taking then onwards !!

That isn’t how advertising is sold. It’s packaged. There are never any slots that are unfilled. Even ITV2 on launch had full breaks. They sell packages. 1 prime slot 20 out of prime and they used to throw in ITV2 and 3 for free. Or they sell the package on estimated views. IE in one month your ad will be seen x times and it will cost you x amount. I think from memory less than 1% of adverts were “spotted” ie exactly schedule for a certain time and placement in the break. Usually this was around big events for obvious reasons. ITV still is the number one place for advertising eyeballs. Sure it’s losing its numbers but it attracts enough people enough of the time to make the difference.