Business

Wizz Air sees flat capacity as engine issues, groundings persist

Budget carrier sees net income of €500m to €600m

Wizz Air had 47 aircraft grounded during the period. Photograph: Steve Parsons/PA Wire

Thu May 23 2024 - 07:47

Wizz Air said capacity won’t advance in the fiscal first half and the full year as the Hungarian budget airline continues to grapple with geopolitical instability and the grounding of aircraft because of engine issues.

The carrier had 47 Airbus A320 family aircraft on the ground because of engine issues as of May 17, it said in a company filing. Wizz said it expects about 50 aircraft grounded by the end of the first half of fiscal 2025. The company said it has secured compensation from engine maker Pratt & Whitney and expects more payments “on similar terms” for the final quarter of the fiscal year “and beyond.”

Wizz said trading in the financial year “has been encouraging, with sustained demand and positive booking momentum for the summer.” The company predicted net income for the full year of €500 million to €600 million, compared with an estimate of €515 million. Net income attributable to shareholders last year reached €376 million, beating estimates.

Besides the engine issues, Wizz has grappled with air traffic control disruptions as well as geopolitical tensions that include disruptions on its service to Israel. The company said the revenue impact from the Israel-Hamas conflict and the wider region came to about €80 million in its most recent fiscal year.

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Wizz, which has seen shares decline about 11 per cent so far this year, is the last of the major low-cost carriers to post results this quarter. Ryanair Holdings Plc and EasyJet Plc both reported strong travel demand this summer and pointed to constrained capacity across Europe as airlines face supply chain backlogs. – Bloomberg

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