Wizz Air shares were down 5.7% to 2,601p in early morning trading on Wednesday, after the travel firm reported a widened loss of 11.5% to €642.5 million in FY 2022 compared to €576 million in FY 2021.
Wizz Air narrowed its operating loss by 11.9% to €465.3 million against €528.1 million, alongside a narrowed EBITDA loss of 89.6% to €19 million from €182.8 million in the year before.
The airline experienced a revenue climb of 125.1% to €1.6 billion compared to €739 million, and the number of passengers carried soared 166.3% year-on-year to 27.1 million against 10.2 million.
The company further mentioned a fall in total cash of 14.7% to €1.3 billion from €1.6 billion in the previous year.
Wizz Air also noted a load factor increase of 14.1% to 78.1% in FY 2022 from 64% in FY 2021.
“Our investments in staffing, our fleet and diversifying the network enabled us to recover capacity faster and we operated more than twice as many ASKs compared to F21, while carrying 27.1 million passengers, compared to 10.2m in F21,” said Wizz Air CEO József Váradi.
“The load factor improved to 78 per cent, significantly ahead of the 64 per cent seen in F21.”
Outlook FY 2023
Wizz Air highlighted an expected capacity growth over FY 2023 Q1 and Q2 of over 30% and 40%, respectively, along with a stronger FY growth against FY 2020.
However, analysts do not share the company’s sunny skies outlook, and warned that hard times were encroaching on the horizon for the group.
“Despite saying the business is on track for a record summer, Varadi can’t escape the fact the airline industry is on the verge of a meltdown thanks to a lack of staff in airports,” said AJ Bell investment director Russ Mould.
“There is no way of glossing over the issue that a growing number of people are likely to be ditching plans to fly this summer as they don’t want the hassle of flight delays, cancellations and long queues.”
The travel group said it intended to facilitate its aims with its fleet of 182 aircraft by the end of the financial year, with more than 50% neo aircraft, an average fleet age of 4.1 years and an approximate seat count of 221 to drive its competitive cost and environmental advantage.
“Despite this negative situation, Wizz Air continues to expand as a business, adding more aircraft, new bases and new routes. It’s giving Ryanair a run for its money in terms of finding new ways to get customers to pay for things beyond a ticket. This so-called ‘ancillary revenue’ now accounts for more than half of group revenue,” said Mould.
Wizz Air mentioned it would be relying on higher costs linked to inflation to drive customers to budget airlines, and added that it was partially hedged over summer to provide some protection against fuel prices hikes.
The travel company highlighted an expected operating loss for Q1 2023, despite strong consumer demand, as a result of air traffic control disruption, continuing operation issues and a volatile macroeconomic environment.
Wizz Air commented that it could provide no further guidance for the coming year in light of poor visibility and a turbulent geopolitical environment.