Wizz Air forecasts better annual profit range as rivals struggle

Wizz Air Holdings on Wednesday raised the bottom end of its annual profit forecast, as the budget airline benefits from a strong first-half while struggling rivals cut expansion plans.

Wizz, which mainly has flights to central and eastern Europe, said net profit for the financial year 2020 would be between €335 million to €350 million. It had an earlier range of €320 million to €350 million.

Net profit for the six months ended September 30th rose 87.1 per cent to €371.5 million.

"The more recent supporting market conditions mean we are seeing our business tracking towards the top end of our current net profit guidance range, which gives us confidence to tighten the range," chief executive Jozsef Varadi said in a statement.

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Wizz Air reported an 17.9 per cent increase in first-half passenger numbers to 22.1 million, higher load factors, with excluding-fuel unit costs down 3 per cent.

Fuel unit costs, however, increased 5.3 per cent year-on-year.

Wizz, which competes with Lufthansa's Eurowings brand at central European airports such as Vienna, is performing well in a strained industry that is being plagued by weaker demand, rising fuel costs, competition, strikes, bankruptcies and the grounding of Boeing's Max 737 fleet.

British Airways parent IAG has warned that its full-year profit will be hit by a pilots' strike at the UK carrier, while Lufthansa is ready to go into arbitration to resolve a long-running staff dispute.

Ryanair also expects further delays to its Max 737 deliveries.

In July, Mr Varadi said that Wizz, whose fleet is powered by Airbus, was increasing its capacity plans. – Reuters