Wizz Air’s financial performance has shown a marked improvement as the airline releases its latest financial report.
In the last year, Wizz Air has been credited with having continued operations in Ukraine during the early stages of the invasion of the country by Russia in order to help people leave the country. In addition, it has also been mired in controversy when it was forced to back down on attempts to launch a service from Abu Dhabi to Moscow.
Wizz Air’s Financial Performance has improved | © Wizz Air
Wizz Air’s Financial Performance
In the previous quarter, Wizz Air reported a loss of 452.5 million euros. However more recently the airline’s financial performance was better than the previous quarter reporting a half-year loss of 384.3 million euros.
Wizz Air’s financial performance is still in the red, however. Jozsef Varadi, the company’s Chief Executive, has commented that the company faced operational challenges and had problems due to high commodity prices which are now starting to settle.
The carrier was not alone in facing operational issues with flights diverted due to the war in Ukraine, sanctions on Russia dramatically increasing fuel prices, and to make matters worse, many airlines (particularly in Europe and North America), have been dealing with staff shortages and an ability for airlines and airports to manage the surge in demand after pandemic restrictions were lifted.
Nevertheless, The airline’s financial performance has improved in the last quarter to the extent that its losses are now reduced. In addition, as Varadi also points out, the company’s revenue (total money received) was 2193.8 million euros which is a significant improvement from the previous year’s revenue at the same time of 880.4 million euros. This is a 149.2% increase compared with the same time last year.
Varadi also points out that the half-year revenue is also 41% higher than the same period pre-Covid. Therefore, the position in terms of revenue is good news. Varadi also comments that it has had to deal with increased costs but that the company is able to add this cost to ticket prices.
Wizz Air has faced operational challenges. © Wizz Air
In other developments relating to Wizz Air’s financial performance, Varadi has commented that the company is exercising its rights to purchase 75 A321neo aircraft at competitive prices negotiated prior to the current inflationary environment. This means that the company is able to save money when expanding its fleet. He has also mentioned that lenders are effectively competing to provide loans for the company and that 15% more lenders are interested in providing loans to the airline compared with last year showing that Wizz Air’s financial performance has improved.
Wizz Air’s financial performance, even though the company is still making a loss, is still better than it was. Varadi has discussed operational difficulties which account for the problems that the company is having. This is similar to the problems many other airlines are also undergoing. However fortunately Varadi feels that the situation is improving as costs are better controlled and operational performance increases. We have to wait to see how this progresses.