EasyJet says Paris attacks lead to 'cooling off' in travel to France

Reuters with CNBC.com

British airline easyJet experienced a "cooling off" in demand for travel to France after the Paris attacks on Friday which killed at least 129 people, but expects normal services to resume quickly, said its chief executive.

"You will always see a cooling off period but you also see quite a quick resumption to travelling again," easyJet's Chief Executive Carolyn McCall told reporters on a call on Tuesday.

An EasyJet aircraft.
Adam Berry | Getty Images

The no. 2 low-cost carrier said that there was an increase in the number of passengers who had booked to go to France but did not show up for their flights over the weekend. easyJet has offered customers who were booked for travel to Paris the chance to defer or change their tickets.

Regarding Egypt, where the airline has had to cancel flights to the Sharm al-Sheikh resort after a British government warning over airport security, McCall said that that disruption would have a "very, very small" effect on the company's full-year outcome.

However, shares in the airline company more than 4 percent lower after it posted earnings on Tuesday.

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Orders 36 more A320s

On Tuesday, easyJet signaled its confidence in future growth by ordering 36 additional A320 aircraft amid what it called resilient demand for flights, after reporting an 18 percent jump in annual profit on bumper summer holiday travel.

EasyJet said the new planes reflected its robust trading and the profitable opportunities it sees in its markets, adding that forward bookings were in line with last year.

For this winter, easyJet's bigger rival Ryanair has talked of a fare war in the cut-throat European travel market, as airlines raise capacity and compete against each other in a lower fuel price environment.

But easyJet said it would retain its profit momentum through growing passenger numbers 7 percent a year and controlling costs, adding that current market expectations are in line within the board's forecast for its 2016 financial year.

Airline stock slump temporary after Paris: Director

For the year ended Sept. 30 2016, analysts are expecting easyJet to report pretax profit of 746 million pounds ($1.13 billion), building on the pretax profit of 686 million pounds it made in the year earlier period and which it reported on Tuesday.

That was in line with upgraded guidance of between 675 million pounds to 700 million pounds provided by easyJet two months ago after strong demand for summer holidays and city breaks.

The new plane order was part of a decision by easyJet to exercise the rights to 30 A320 NEOs from an existing deal with Airbus signed in 2013, plus an order for six extra current generation A320s.