March 11, 2020 / 8:02 AM / 20 days ago

UPDATE 1-Dart Group raises 2020 profit outlook again while sector battles virus outbreak

(Adds outlook, background)

March 11 (Reuters) - Dart Group, owner of British tourist airline Jet2, on Wednesday raised its profit forecast for the second time in six months, saying it looked on course to do more business this summer despite a drop off in bookings because of the coronavirus outbreak.

The epidemic could rob passenger airlines of up to $113 billion in revenue this year, the International Air Transport Association (IATA) said last week, as airlines across the globe rush to cut flights and costs.

Dart also said momentum had weakened in recent weeks as the coronavirus spreads in Europe, but that its current summer 2020 bookings remained higher than last year.

However, the company warned that the impact of reductions in 2021 flying capacity on its financial hedging operations would hurt profits.

“Until very recently, customer demand for our very popular Package Holidays and Flight-Only Leisure Travel products has remained consistently strong,” the company said, adding that booking performance in January and February was well-ahead of its 16% summer seat capacity increase.

The company raised its profit outlook in October as it boosted passenger numbers following the collapse of former rival Thomas Cook.

Dart, which runs package holiday company Jet2holidays, said it is unable to determine how the virus will affect its 2021 profit. It has also cut capacity on some routes.

The company said Fowler Welch, the company’s distribution and logistics business, was performing in line with expectations and continues to develop its pipeline revenue. (Reporting by Tanishaa Nadkar in Bengaluru; Editing by Patrick Graham, Bernard Orr)

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