Wizz Air warns of more losses ahead of crucial summer season

Wizz Air, the European low-cost airline, has forecast more losses at the start of the summer season as disruption at airports and slowing economic growth hamper the industry’s recovery from the pandemic.

The London-listed airline on Wednesday said it expected demand for travel this summer to be “excellent”, and that during the peak months between July and September it would fly 40 per cent more than in 2019.

But it expected to lose money in the current quarter, between April and June, and did not provide financial guidance for the rest of the year.

“The airline industry remains exposed to externalities such as air traffic control disruption and continuing operational issues within the airports sector, adding to a volatile macro environment”, said chief executive József Váradi.

Airlines, airports and ground handlers across many parts of Europe have struggled to hire enough staff this year after cutting tens of thousands during the pandemic.

Wizz Air has cancelled some UK flights over the past week, but has not been as badly hit by the disruption as rivals such as easyJet and, earlier in the year, British Airways.

Wizz Air last week announced plans to pull most of its flights from Doncaster airport, a smaller airport in the north of England, which it said would “stabilise our operations at other UK bases”.

The airline has recruited more than 2,200 people over the past year and expects to have 6,700 staff by the end of the summer, up from around 4,000 people before the pandemic.

“We are deploying extra resources to minimise disruptions and urge all other stakeholders to do the same,” Varadi said.

The airline reported a loss of €642.5mn in the 12 months to the end of March, up from €576mn the year before.

Once singled out by investors as a pandemic winner, shares have fallen 40 per cent this year, with analysts pointing to the airline’s exposure to eastern Europe and Ukraine, and a late decision to hedge against rising fuel prices.

Varadi said Wizz Air would look to extend its current “partial hedging” over the summer into the rest of the year “at the right conditions”.

Mark Simpson, aviation analyst at Goodbody, said it was “unfortunate” the business had not been able to add extra protection against volatile fuel prices, and that “commentary of a quarterly loss will hang heavy over the stock”.

Shares in Wizz Air fell 1.5 per cent in early trading in London.