EasyJet benefits from Ryanair's retreat as winter fares gain

EasyJet said its fares are set to gain this winter, buoyed by the collapse of carriers including UK-based Monarch Airlines and capacity cuts at main European rival Ryanair Holdings Plc. The demise of Monarch and Germany’s Air Berlin Plc, a bankruptcy filing at Italy’s Alitalia and Ryanair’s move to scrap part of its timetable because of a staffing crisis are “all very good news for EasyJet,” CEO Carolyn McCall said Tuesday. EasyJet shares rose the most in three years after the Luton, England-based carrier said that revenue per seat -- a measure of prices -- should increase in the six months through March after a drop last year, excluding the impact of taking over some Air Berlin routes. McCall said the shakeout of Europe’s airlines has benefited EasyJet structurally and given Europe’s second-biggest discount airline strong momentum going into fiscal 2018. The retreat of rivals comes as a boost after the weaker pound weighed on last year’s earnings. “The first half is looking extremely positive and that is as a direct result of the dislocations in the market,” McCall said. Revenue per seat should increase by a low to mid-single digit percentage in the six months through March, versus a 0.4 percent drop in fiscal 2017. Heading into next summer, higher oil prices are likely to result in further pressures for carriers, McCall said, so that “the strong will get stronger and the weak will get weaker.” EasyJet itself is “very well hedged,” she added.<br/>