The company said in its half-year report that summer 2018 had proven to be a particularly strong season for its leisure travel business, with demand for both its flight-only offering from Jet2.com and its higher margin package holiday product from Jet2holidays “buoyant throughout”.
Group operating profit increased by 68% to £350.1 million and group profit before foreign exchange revaluation and taxation increased by 68% to £339.4 million.
However, the group said increased losses were expected in the second half of the year as it continues to invest in additional aircraft and marketing, together with the increasing cost of retaining and attracting colleagues in readiness for further flying programme expansion at all its operating bases in the summer 2019 season.
The board expects current market expectations for the year ending March 31, 2019 to be met.
Looking ahead, the group said “significant cost pressures such as fuel and other operating charges, plus the necessary continued investment in our products and operations including that required to retain and attract colleagues”, were emerging headwinds.
“This, coupled with the overall uncertain UK economic outlook particularly related to Brexit and how it may impact on consumer spending, means we remain unclear how demand will develop in the medium term,” the statement read.
“However, our strategy for the long term remains consistent – to grow both our flight-only and package holiday products.
“On the assumption that the UK government secures a pragmatic and balanced Brexit agreement with the EU, the outlook remains bright and we continue to have confidence in the resilience of both our leisure travel and distribution and logistics businesses.”
Average flight-only ticket yield per passenger sector at £88.02 (2017: £75.55) was 17% higher compared to the challenging market in the prior year. The average price of a Jet2holidays package holiday grew by 7% to £689 (2017: £645).
Non-ticket retail revenue per passenger grew by 9% to £23.83 (2017: £21.83).
Overall, leisure travel revenue grew by 38% to £2,158.2 million (2017: £1,569.5 million) at an operating profit margin of 16% (2017: 13%), resulting in operating profit growth of 69% to £347.8 million (2017: £206.2 million).