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Wizz Air jumps over 7% on hopes of summer rebound

Wizz Air flags wider annual loss on subdued demand, high fuel costs
Wizz Air flags wider annual loss on subdued demand, high fuel costs   -   Copyright  Thomson Reuters 2022
By Reuters

-European budget airline Wizz Air said on Thursday demand trends have been encouraging in the recent weeks and summer bookings were likely to improve significantly after Easter, sending its shares more than 7% higher.

The ultra-low cost carrier’s losses in the fourth quarter ending March 31 is also expected be better-than-feared, Wizz Air said as the coronavirus’ Omicron variant proved to be of “benign nature”, leading to quicker easing of restrictions.

It, however, forecast annual loss to be bigger than last year at between 632 million euros and 652 million euros ($689.8 million and $711.6 million), compared with a net loss of 576 million euros a year earlier.

Although Russia’s invasion of Ukraine has dented demand for air travel and destabilised oil prices, Wizz Air’s comments about a potential summer recovery lifted its shares 7.4% to the top of London’s midcaps index by 0809 GMT.

With flights to Ukraine, Russia and Moldova remaining suspended, Wizz Air said it had already reallocated the affected capacity to other parts.

It has also reduced its exposure to volatility in oil prices by hedging for a coverage of 36% of planned fuel volume usage from April to August this year, with an average ceiling price of $1,130 per metric tonne, the carrier added.

($1 = 0.9163 euros)