Wizz Air Returns to Profit

Wizz Air, the European low-cost airline, has announced its first annual profit in three years, boosting its London-listed shares on Thursday. The Hungary-based carrier is preparing for a robust summer season after overcoming challenges like flight cancellations due to the Middle East conflict and engine inspections grounding parts of its fleet.

CEO Jozsef Varadi highlighted the sustained strong demand for air travel as the airline enters the fiscal year 2025. He noted that this demand is expected to continue in the near term, supporting a higher yield environment despite capacity constraints across the industry.

Varadi also acknowledged that inflationary pressures, rising costs, and strained supply chains due to geopolitical instability will persist in the coming year. However, he emphasized that cost control efforts and a strong summer season will drive growth. Wizz Air projects a net income of 500-600 million euros for the current year.

For the fiscal year ending March 31, Wizz Air reported a net profit of 365.9 million euros ($396 million) after three consecutive years of losses. The airline carried a record 62 million passengers during the year. Its shares reached 2,096 pence, rising 4.9% to 2,060 pence as of 0817 GMT.

RBC analysts praised Wizz Air's growth potential, supported by its A321neo orderbook and its presence in fast-growing Eastern European and Middle Eastern markets. They expect a favorable environment for fare growth in 2024/25 and noted the airline's cost leadership among European carriers, alongside Ryanair.

Meanwhile, Ryanair, Europe’s largest airline by passenger numbers, recently reported an annual profit that exceeded analysts' expectations. EasyJet also reported first-half losses in line with its forecasts, indicating varied performance in the industry.