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EasyJet benefits from rivals' cut-backs

EasyJet benefits from rivals' cut-backs
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Budget airline EasyJet’s strategy of adding flights on routes where cash-strapped rivals have cut back seems to be paying off.

Its latest earnings forecast was better than industry analysts had been expecting which pushed its shares up to a record high on Wednesday.

Europe’s second-largest low-cost carrier after Ryanair is anticipating a six percent rise in revenue per seat in the second half of its financial year, which ends in September.

That would mean pretax profit of between 450 million pounds (522 million euros) and 480 million pounds (556 million euros) up from last year’s 317 million pounds.

Rival airlines have been struggling with high fuel costs and weak consumer confidence.

Some smaller carriers have gone out of business while the likes of British Airways and Iberia’s owner IAG and Air France-KLM have cut routes. That has left gaps that low-cost airlines have been quick to exploit.

EasyJet, which increased capacity by 3.6 percent in the quarter, said it had particularly benefited from adding flights on routes to Italy and Switzerland.

Earlier this month it won shareholder approval to buy 135 new Airbus planes despite opposition from its estranged founder Stelios Haji-Ioannou.