Member Info for Xhita

Another very low volume day. The market is all but closed down. A handful of meaningful trades. The LSE is a wasteland

The important operational factors for the next 8 weeks but especially the next 5 weeks whilst they are at capacity are the events causing disruption and cancellation of flights.

The weekend went with very minor issues that I can see.

We have the cabin crew strikes for Portugal based aircraft for 3 days 15-17 August that has resulted in 164 flight cancellations, no compensation payments and premium fares on flights to Portugal from other hubs.

French ATC action appears to be having less and less impact as business works around the issue but we can definitely expect more.

Assuming that's it we'll have 5+ more disruption free days than last year which even forgetting loss and compensation amounts to around £45m extra profit.

I am most interested in the winter schedule because there's so much to gain from the holidays business here. The OTAs will feel the pain.

So nothing real then just nonsense.

HTTps://www.fool.co.uk/2024/08/04/after-crashing-47-the-easyjet-share-price-is-now-in-deep-value-territory/

Margins are tight due to intense competition and increasing environmental demands. Airlines also have high fixed costs and must reinvest constantly to keep their fleets fit to fly. I haven’t even mentioned fuel costs

Is the competition intense....it seems to me that LCC rarely compete head to head. Nobody living near Bristol will drive to Gatwick or Birmingham for a flight. Easyjet are largely without any comparable competitors.

Environment demands are not increasing they were set long ago and the target for change is in the future. Easyjet aircraft swaps meet much of the environment goals whilst increasing capacity and saving money.

Fixed costs. Yes every business has costs, fixed is much better than unknown. When they review routes costs is a primary factor.

Must continue to invest. Yes absolutely and that's where growth, capacity and profit comes from. The minute easyjet stop investing is the time to start worrying.

Fuel costs.....A fixed cost for hedged and random cost for unhedged. Currently A1 on the field is $200 a MT less than the easyJet hedge so clearly it's well below budget.

I don't understand why any of this is a challenge it's just the business. All the airlines have the same issue.

Rather than making stuff up why not think about the facts. Easyjet are growing. Ryanair are struggling. Easyjet has a booming holiday business with high margins. Easyjet offers great value and they have a loyal customer base. Easyjet has the right aircraft, the right engines and very little to hold it back from dominating the sector.

Whether any of that is real remains to be seen but the market doesn't move every few minutes because of anything real.

It moves because people or groups of people think that other people make decisions based upon these things.

Success is a relative term. Easyjet are having a rip-roaring year compared to the share price. They are clearly going to have a very productive year and another record Q4.

I tried to get to the beach today and literally there was no chance. Hire cars everywhere and every space full. It's clearly a very busy time.

I am watching prices and easyJet are firm. The same lightening sales for very specific flights.

The UK economy has been trash for several years now and ultimately someone has to pay for Brexit.

Easyjet don't have any issues with their aircraft. They have their full fleet available and flying the biggest schedule ever. They are making around £9m profit today and yesterday. This is prime time and so far it's gone with substantially less cancellations than last year.

Easyjet report good demand and massive growth in easyJet holidays.

Wizz are a disaster, forced to wet lease to cover routes, ryanair report that the public has had enough of them and are booking in smaller numbers at lower price.

Despite these facts Easyjet shares fall.

Why... because there are abusive things going on. Ultimately they will clear.

Again information irrelevant to easyjet moves the price down.

A few more for me today.

Yes it's not new news but headlines count as the average attention span doesn't go beyond the first 3 lines.

DrMaze. Very true. It's a nonsense but it's where easyjet are.

Nonsense opening price.

It's costing them exceptional amounts to maintain services but their performance is good given their uncertainty and ability to plan around aircraft availability

Vince you did read the bit about their aircraft being grounded......

A strong performance from wizz given that they are short nearly 50 aircraft at a time.

Exceptional accounting means the headline profit is well down but underneath that they are not talking like O'Leary and appear robust.

Obviously they are not going to flourish under the availability of aircraft but have maintained high load factors and are optimistic about the forward situation.

Obviously the headline will be totally misleading with no explanation.

Last year there were substantial cancellations around 10th July and 23rd both disruption reporting substantial cancellations, 1700 flights around the 10th.

Nothing like that this year to concern us so far. Cancellations over crowdstrike but I can only see mentions of isolated airports so no blanket issues. This is the biggest factor for this period and the thing most likely to derail substantial profit. Every clear day derisks the summer.

We'll see but the holidays outcome will contain a good deal of caution. This year the hotels engaged are much more numerous and Birmingham Airport continues to be the best performer for

holiday bookings. That's new this year.

They already raised from £170-180m I rather suspect that they will do much better. It's all down to the disruption now for the average per day profit.

According to the easyjet site seats flown is up around 10% on average. That will hold firm for July and August looks very full.

All to play for but so far this summer is well ahead of last in terms of volume.

You have to view some days as wasted or it just doesn't make sense. A smooth summer will give maybe 10 days of disruption. The window for profit is not every day. They build in baseline to their projections. Every day above baseline is a bonus day in prime time. Bring on the disruption after the summer. What have we had so far, maybe 5 .

Around £720m I think. £663m last year Q4 Easyjet holidays will add around £40m additional profit in Q4 based upon the

stages last year and the £58m increase

expectations over £122m last year.

So that's a bit over £700m . Then we have profit from the days this year with no disruption over last year. We are well ahead so far. Just crowdstrike, and some isolated ATC cancellations. Nothing from Israel in Q4.

If it stays calm with just 1-2% of flights delayed or cancelled £9m a day is very achievable. There are more flights this summer than ever before.

Meanwhile easyjet pocket £9m a day profit this quarter. Every day without disruption is a day closer to a perfect quarter.

It will take people to buy and not sell on 1% profit. The market has dumbed down to this ridiculous point. No real confidence and rampant fear. That's what a destroyed economy does.

Anyway, a quick swim then work for me. Buenos Dias

With a £1bn medium term profit goal IF they achieve that and realise some valuation for the holiday business £5-7 looks very cheap.

Yes we saw substantial dilution during covid but since they have built a secondary business which in 2-3 years time could exceed the airline business profit. The industry has completely changed, the £9.99 ticket has gone, the competition is substantially weakened by an outdated and stale business model. I am talking about ryanair and Jet2. Wizz are largely in different markets.

Easyjet has evolved to take new opportunities.

Yes there are more shares but the commercial opportunity is so much more now

So far good results have been met with a fall in the share price even though they have made consistent progress. I think that it will be well above £5 by results time if

disruption remains minimal. However this market is clearly controlled by many factors. Fear is well established and the controlling factor for the small investors whilst the big plays toy with the share price. It's easy to create a false drop that turns to a landslide. Volume is critically low and control is gained very easily. Once stop losses and electronic passive trading are triggered a small action has a disproportionate result.

It will go up but beware commercial success is not transferred fairly to the share price.