By Sarah Young
LONDON (Reuters) - British low-cost airline easyJet (L:EZJ) plans to fly at 40% of its capacity over the rest of the summer thanks to stronger than expected bookings despite continuing pandemic uncertainty.
A tentative return to air travel in Europe from mid-June after a three-month pause brought airlines to their knees has been threatened by a fresh rise in COVID-19 cases, with the UK already reintroducing travel restrictions to Spain.
But easyJet said late summer bookings were "performing well" and it would now fly 40% of last year's capacity in its fourth quarter, compared to earlier guidance of 30%, with its focus on profitable flying and its flights about 84% full.
Its shares, which have lost more than 60% of their value since the start of the year, jumped 8% to 547 pence.
The airline also said its cash burn for the three months ended June 30 was better than expected, at 774 million pounds rather than the 1 billion pounds guided, and that its fourth quarter loss would be smaller than the 324.5 million pound loss booked in the third quarter.
"An encouraging report for the return to service, with healthy load factors," said Bernstein analyst Daniel Roeska.
EasyJet, which said in May it would need to cut 4,500 jobs, has taken a more cautious approach than rivals. Europe's largest budget carrier, Ryanair, said its capacity would rise to 60% in August and 70% in September, while smaller player Wizz Air (L:WIZZ) is at about 70%.
Johan Lundgren, easyJet's chief executive, said beach destinations like Faro and Nice were popular but the market would remain unpredictable.
"There still is uncertainty you know, also in September, and there's very little visibility for the whole of the industry on what's going to come in the winter," he told reporters on Tuesday.
Ryanair was forced to cut its annual passenger target last week, warning of the impact of a potential second wave of the virus.
