Central European budget carrier Wizz Air is forecasting a net profit of €500-600 million ($540-650 million) for the current full year, despite the problems of groundings forced by Pratt & Whitney engine inspections.
The airline has confirmed a net profit of €366 million for the year ended 31 March, turning around a prior loss of €535 million, and says its trading indicators over the current year are positive, with unit revenues performing well.
But Wizz expects capacity over fiscal 2024-25 to be flat, both over the first half and the full year.
Chief executive Jozsef Varadi says the airline has “moderated” its capacity expectations for the year, owing to “changes in the operating environment” including the continuing rolling groundings of Airbus A320neo-family jets while they undergo PW1100G engine examination.
Wizz had 47 aircraft on the ground as of 17 May, and it expects around 50 to be grounded by the end of the first half in September – around a year after the inspection situation emerged.
The airline is maintaining its assumptions on the average shop-visit time, 300 days wing-to-wing.
It took some 20 spare engines last year, giving it about 40. It expects delivery of around eight to 10 more by the end of June, and foresees having over 50 in total by the end of the summer.
“Wizz Air has actively managed its fleet to minimise the impact of grounding, deploying the [A320neo] fleet to longer sectors, extending existing leases, securing third-party aircraft and advancing additional spare engines,” it states.
The airline has obtained compensation as part of a support package and expects further similar measures for the fourth quarter of the current fiscal year and beyond.
While Wizz is scheduled to take delivery of 27 new A321neos this year, it will supplement capacity by extending leases on 11 A321s – on top of 13 other extensions arranged last year – and dry-lease three aircraft. It will also take advantage of seasonal wet-leasing. The airline points out that new deliveries from summer will not require engine inspections.
“We have proven that our model is agile, highly resilient and well positioned to mitigate the impact of these ongoing issues,” says Varadi. “This includes the current scale and diversity of our network, which means we are incredibly well-placed to react quickly to issues as they arise.”
He says air travel demand “remains robust” with “no sign of abating in the near term”, which will support higher yields in an industry which is capacity-constrained.
