Shares in stock market darling Jet2 lost 10% of their value today as it warned that cash strapped holidaymakers are delaying their bookings. The package holiday operator’s share price fell almost 10% to 1411p in early trading after the company issued a bumpy update to investors. It said that the “later booking profile” first noticed last summer has continued into the winter season 2025. The average load factor for the winter season is down more than 2 percentage points, although the late timing of Easter was a factor.
The company said it was “continuing to see a later booking profile” for the coming summer as well. CEO Steve Heapy, said: “We recognise the current macro-economic conditions and the many demands placed on consumer discretionary incomes, which combined with the later booking profile and cost headwinds detailed, may mean profit margins in the year ahead come under some pressure.”. Foreign travel has been one of the most resilient sectors since the pandemic with passenger numbers rapidly rebounding to exceed pre-covid highs.
All the major London airports are now seeing record traffic. So the warning from Jet2 could be one of the early signs that the boom is topping out. Jet2 said it is also facing above inflation cost increases particularly for hotel accommodation, aircraft maintenance and general airport and Eurocontrol charges. The increases in the National Minimum Wage and employer National Insurance Contributions in April will add another £25 million in costs.
A further headwind is the required increase in use of Sustainable Aviation Fuel to 2% of total aircraft fuel mix which “will result in over £20m of incremental costs, owing to the significant price differential between SAF and conventional jet fuel.”. Another factor has been delayed in the delivery of new Airbus jets. The company said it now expects for the year ending 31 March 2025 to be between £560 million and £570 million, an 8% to 10% increase on the previous year.
