 took a hit, as Angela Merkel suggested that the EU should categorise the UK as a “country of concern”){kind=link}
EsyJet Share Price
As reported yesterday, the EasyJet share price (LON:EZJ) took a hit, as Angela Merkel suggested that the EU should categorise the UK as a “country of concern”, in addition to implementing restrictions to those travelling from the UK.
With the EasyJet share price down another 2.26% on Tuesday, it has lost 11.98% over the past five days. Heading into July, and with the rising spectre of the Delta variant, investors will be concerned about the future prospects of the low-budget airline.
Balance Sheet
The good news for investors is that EasyJet’s finances are relatively strong. The airline should not have to undergo any drastic measures in the near future.
This is because the company has £2.9bn in cash and unused debt, while over the past year, EasyJet has also carried out a significant restructuring and cost reduction process.
The cash could allow the EasyJet share price to bounce back as the airline recovers when restrictions are eventually lifted, and will keep it operational in the meantime, even in the event of the worst case scenario.
Air Travel
So, what is the worst case scenario? It could take years for EasyJet to reach pre-pandemic levels of flights. And the airline could miss out on a whole summer of travel. But it remains difficult to know if this will happen.
What is known is that the emergence of the highly infectious Delta variant led the UK government to delay England’s reopening phase by a month, now July 19.
The airline industry, including Johan Lundgren, chief executive of EasyJet, has called on Boris Johnson to relax restrictions, especially for vaccinated people, but it appears to be to no avail.
It has been estimated that up to 195,000 travel jobs have gone or are at risk of being lost due to the pandemic.
Lundgren usurprisingly believes “that much of European travel could be opening up in a safe way”.
While the recent fall in the EasyJet share price could attract investors, there could also be further to go. In the meantime, investors and travellers alike may have to show a little more patience.