Wizz Air gets ahead with its recent financial reports

LONDON – On July 27, 2022, Wizz Air Holding recently recorded the fastest growth, one of the greenest European airlines, published its impressive first quarter 2022 of 808.8 million euros, an increase of 306 .4% compared to the 1st quarter of F22. Ticketing revenue exploded by 349% to 392.0 million euros.

Numbers…


Ancillary revenue thus increased by 272.6% to 416.8 million euros. Total unit revenue therefore increased by 28.7% to 3.46 euro cents per available seat kilometer (ASK).

The increase in ancillary revenue per passenger compared to F20 is driven by the dynamic pricing of bundled sales of seats with additional baggage as well as a gradual increase in demand for other products and services.

The gradual increase in demand is accompanied by higher purchasing power, as ticket revenue per passenger increased by 9.0% compared to F22 to €32.2, while compared to F20 which recorded a tracking decline of 12.0% or a decline of €4.4 per passenger.

What is holding back potential growth is the war in Ukraine, which is dampening potential demand and increasing purchasing power.

Not surprisingly, like many airlines, total operating cost increased by 255.3% to €1,093.3 million compared to Q1 F22, where total unit cost increased by 8.3% to 4.80 euro cents per ASK and was driven by significantly higher unit fuel costs. (because of the ongoing war).

In fact, fuel costs have dramatically increased by 153% to 2.18 euro cents per ASK.

This poses a threat to the airline’s financial stability as the airline reported a statutory loss for the period of €452.5 million.

Nevertheless, the resumption of services resulted in a total cash position of €1,583.2 million at the end of June 2022. The restricted cash of €153.2 is included in the final figure.

József Váradi, Managing Director of Wizz Air, commented on the results: “During the first quarter of F23, we continued to accelerate Wizz Air as COVID-19 transitioned from a pandemic to an endemic environment. Passengers and revenues more than quadrupled from the same quarter last year, up nearly 20% from pre-pandemic levels, with 30% more capacity operated. »

“As we rebuild the airline on a larger scale, we remain keenly aware of the challenging macroeconomic and operating environment. Fuel prices for the quarter were double pre-pandemic levels.”

“Ongoing COVID-19 restrictions remained, particularly in April and May, while the war in Ukraine and supply chain disruptions affecting air traffic control, security and ground operational resources took their toll. an impact on our use.”

“As a result, unit costs (CASK) for the quarter were approximately 40% higher than pre-pandemic, 75% of this increase was due to raw material inflation, while unit revenues (RASK ) for the quarter were 10% below pre-pandemic levels, primarily based on lower load factors as we ramp up the operation and the war in Ukraine slowed our momentum.

“Our operating loss for the quarter was €285 million, while our reported net loss of €453 million was impacted by the strength of the USD resulting in an unrealized and unrealized currency impact on the income statement.”

“Our liquidity strengthened significantly during the quarter to €1.6 billion as we grew our business. During Q1 F23, we invested to re-establish our proven pre-pandemic operating model defined by our ultra-low-cost principles.

“We are already seeing the results of this investment in the second quarter and expect to generate a strong operating profit as revenue and pricing dynamics continue to improve.”

The CEO also commented on further developments in Wizz Air’s business during the growth period: “During the quarter, we focused on ramping up our network – restoring capacity in our core markets just below pre-pandemic levels.”

“Around 30% of our new capacity has been deployed in markets where we have expanded new operations during COVID-19 (e.g. Italy, Albania, Abu Dhabi and new bases in the UK and in the Western Balkans).

“We have now adjusted our network in light of industry supply chain disruptions, making tactical capacity reductions from June to increase our operations and supply chain agility. ”

Regarding the summer outlook, the CEO added: “We now have most of the summer ramp-up behind us and expect to operate approximately 30% higher ASKs in the summer compared to pre- pandemic.”

“We anticipate continued month-to-month momentum in total net fares and charges through the summer as we work to maximize RASK – given higher entry costs – and expect that Q2 RASK will improve by +10% over F20.”

“We are encouragingly starting to see a normalization of operational disruption levels as we have reduced utilization by approximately 5% for the summer compared to F20, which is still operating at the industry leading edge.”

“We continue to be a leader in cost and sustainability. Our ex-Fuel CASK cost structure will continue to improve sequentially, our fleet renewal continued with an average aircraft seat count of 214 seats.

“Our summer emissions levels are expected to be almost 10% lower than summer F20 (measured in grams of CO2 per RPK), as we continue to make progress towards our 2030 target of 43g per RPK, i.e. a reduction of 25% compared to F20. ”

Overall: His basic strategy shows that Wizz is on the rise…


In the UK: Doncaster and Cardiff will see one plane, in Venice, Italy will see two planes. In addition, more aircraft will be added to existing bases. In the UK, Gatwick will see 4 new aircraft, bringing Gatwick’s total fleet to five machines.

Luton Airport will see Wizz Air’s largest fleet at 11 aircraft. In mainland Europe, the airline is also experiencing impressive expansion, with Rome and Catania each taking an additional aircraft, bringing the total to five and three respectively.

In Albania, the Tirana hub will welcome 2 new aircraft bringing the Albanian fleet to 8. For Polish operations, Katowice, Warsaw and Gdansk will each take an additional aircraft, bringing the overall fleet to 6, 8 and 7 respectively.

While in Budapest in Hungary, 1 additional aircraft will be stationed there, bringing the total fleet of aircraft to 12. In Romania, the two stations of Cluj and Craiova will see 1 additional aircraft bringing the total fleet of the two cities to 2. Finally , in Cyprus, Larnaca, an additional aircraft will be added, bringing the total fleet to two.

After adding additional aircraft, Wizz Air has also recently launched new routes to Dammam in Saudi Arabia from Rome, Vienna and Abu Dhabi.

Wizz Air’s fleet is one of the most efficient and streamlined. The airline expanded its fleet to 157 aircraft, with eight new A321neos in the quarter alone.

2 of the 8 aircraft were financed through leaseback and sale transactions, while the remainder used the JOLCO option. As we speak, the airline has recovered four A320CEOs due to the end of the lease to their respective lessors.

With the arrival of new planes and the gradual disappearance of old ones, this means that the average age of the airline’s planes is 4.9 years, one of the youngest in the world.

Expanded the fleet to 157 aircraft with the addition of eight new A321neo aircraft during the quarter. Of the eight new A321neo aircraft, two were financed through sale and leaseback transactions, while six used JOLCO transactions.

At the same time, we returned four A320ceos at the end of their leases to lessors, which brought the average number of seats per aircraft to 214 seats. The average age of Wizz Air’s planes is 4.9 years, one of the youngest fleets of any major airline.

The airline plans an additional 36 new A321NEOs in the coming years, while 11 A320CEOs will return to its lessor.

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