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DALLAS — Wizz Air (W6) is confident in its ability to return to profitability after more than doubling its revenues in the most recent fiscal quarter.
In the third quarter of the financial year ending in December 2022, the European LCC reported revenues of €912m (US$994m). In comparison, €408m was raised at the same time last year. A year-over-year continuous 59% rise in passengers to 12.4 million and a 50% increase in unit revenues were the key drivers of the gain.
A More Diversified Route Network
Wizz Air chief executive Jozsef Varadi commented, "Throughout the period, we witnessed a solid pricing environment, supported by robust demand across our broader and more diversified Wizz Air network."
Additionally, throughout the quarter, its services were expanded into Saudi Arabia. The airline recently posted a net profit of €34m, its second consecutive quarterly profit, although it reported an operating deficit of €156m for the third quarter.
The reason behind the deficit marker was the strengthening of the euro. This has caused a revaluation of the liabilities for US dollar leasing and helped to make up for the loss in the first half.
https://airwaysmag.com/wizz-air-targets-turkish-expansion/
Profits and Losses
Due to ramp-up issues, W6 modified its initial capacity expansion plans and aircraft utilization rates in order to increase operational effectiveness. According to the airline, this has reduced flight interruption costs compared to the prior two quarters.
The airline is still optimistic enough that the year to March 2024 will be profitable, but now it anticipates a total net loss for the 12 months ending in March 2023, marking a third year in a row of losses.
Comments from Wizz Air CEO
“We have been encountering significant challenges throughout the current year, but we are very confident that now the ship is moving in the right direction. So we have turned the corner, and you should be expecting a lot more normalized performance… comparable with pre-Covid times,” Varadi remarked during a press call on January 26th, accounting for the third quarter results.
The airline notes its improving load factors and is confident that the gap between load factors in the current quarter and 2019 levels will continue to narrow as its current network investments begin to mature. W6's third-quarter load factor of 87% was 10 points higher than the same period the previous year, although it was still 'five' points below pre-pandemic standards.
“More generally, we continue to see evidence of a solid fare environment as average fares…are trading above 2019 and 2022 levels. As we reach the end of January, we are seeing booking volumes coming in ahead of 2022, which is in line with expectations,” Varadi further added.
Featured image: Wizz Air - HA-LWP - Airbus A320. Photo: Julian Schöpfer/Airways
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