Jet2 : Preliminary Results - 2024

Preliminary Results 2024

Jet2 plc

PRELIMINARY UNAUDITED RESULTS FOR YEAR ENDED 31 MARCH 2024

Jet2 plc, the Leisure Travel group (the "Group" or the "Company"), announces its preliminary results for the year ended 31 March 2024.

Group financial highlights	2024	2023	Change
	Unaudited
Revenue	£6,255.3m	£5,033.5m	24%
Operating profit	£428.2m	£394.0m	9%
Profit before FX revaluation and taxation†	£520.1m	£390.8m	33%
Profit before taxation	£529.5m	£371.0m	43%
Profit after taxation	£399.2m	£290.8m	37%
Basic earnings per share	185.9p	135.4p	37%
Final dividend per share	10.7p	8.0p	34%

• Further information on the calculation of this measure can be found in Note 2.
• Further progress made against our growth strategy as the Group delivered record passenger numbers, revenues and profitability and further strengthened its balance sheet.
• The popularity of our holiday products contributed to Group profit before FX revaluation and taxation increasing by 33% to £520.1m† (2023: £390.8m†).
• Total flown passengers grew 9% to 17.72m (2023: 16.22m); higher margin per passenger package holiday
  customers rose 15% to 6.08m (2023: 5.29m), representing 68.3% of total flown passengers (2023: 64.9%).
• Year-endtotal cash increased 21% to £3,184.7m (2023: £2,624.7m). 'Own Cash'† (excluding advance customer
  deposits), was £1,331.4m (2023: £1,127.1m), providing financial resilience and flexibility.
• In view of the positive financial performance and in keeping with its capital allocation principles, the Board has resolved to pay a final dividend of 10.7p per share (2023: 8.0p), an increase of 34%.
• Underlining our future confidence, the Group exercised its remaining Airbus order purchase rights and now has a delivery stream of 146 firm ordered A321neo aircraft delivering through to 2035.
• Our new Liverpool airport base is proving successful and operations from our 12th UK base at Bournemouth Airport will commence from February 2025.
• Summer 2024 on sale seat capacity is currently 12.3% higher than Summer 2023 at 17.16m seats. Booked to date Package Holiday customers are up 7%, representing 72% of overall flown passengers, with Flight-Only passengers increasing by 16%. Consequently average load factor is currently 73.4% (2023: 75.2%).
• Passengers are currently booking much closer to departure and therefore, pricing for our flight-only and package holiday products must remain attractive. Summer 2024 pricing to date for both products is showing a modest increase, helping to offset in part previously announced input cost increases.
• As ever, we remain mindful of the current macro-economic and geo-political environments and how these may influence future consumer spending patterns. However, we continue to believe that the end-to-endpackage holiday is a resilient and popular product which remains high on the priority list for our Customers, even during uncertain economic times.
• Year to date the business is trading in line with management's expectations. Given the late booking profile and the peak summer months of July, August and September not yet complete, plus the majority of Winter 2024/2025 seat capacity still to sell, it remains premature, as is always the case at this time of year, to provide definitive guidance as to Group profitability for the financial year ending 31 March 2025.
• For the long term, our strategy remains consistent - To be the UK's Leading and Best Leisure Travel business - with 'People, Service, Profits' serving as our guiding principles. With our differentiated and attractive end-to-end product, breadth of hotel choice and flexibility of duration, plus our consistently high-qualityCustomer First approach, we are confident that customers will continue to travel with us from our Rainy Island to the sun spots of the Mediterranean, the Canary Islands and to European Leisure Cities.

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Preliminary Announcement 31 March 2024

Analyst and Investor call

The management team will host an investor and analyst conference call at 9.00am UK time, on Thursday, 11th July 2024. For dial-in details for the conference call, please contact Burson Buchanan in advance to register: [e-mail].

Investor Presentation

The Investor Presentation will be available shortly on the Company's website: www.jet2plc.com/en/company-reports

For further information please contact:
Jet2 plc	0113 239 7692
Steve Heapy, Chief Executive Officer
Gary Brown, Group Chief Financial Officer
Cavendish Capital Markets Limited	020 7220 0500
Nominated Adviser
Katy Birkin
Camilla Hume
George Lawson
Canaccord Genuity	020 7523 8000
Joint Broker
Adam James
Harry Rees
Jefferies International Limited	020 7029 8000
Joint Broker
Ed Matthews
Jee Lee
Burson Buchanan	020 7466 5000
Financial PR
Richard Oldworth
Toto Berger

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Preliminary Announcement 31 March 2024

OUR CHAIRMAN'S STATEMENT

This is my first report as Chairman of Jet2 plc since Philip Meeson stepped down last September. Having served on the Board since April 2020, this was a position I felt privileged and delighted to take up. I would like to pay tribute to Philip who oversaw remarkable growth as he carefully evolved and nurtured the Company over four decades into what is a truly fantastic people-orientated,customer-focused and financially sound business. As his successor, I know we are all extremely appreciative that he continues to offer the wealth of his experience and wisdom in his new role as Founder & Adviser.

Strategic performance

Our strategy remains consistent: To be the UK's Leading and Best Leisure Travel business. It was a challenging year for UK consumers with rising inflation and elevated interest rates putting pressure on disposable income levels. However, against this backdrop we made further progress on our growth strategy, delivering record passenger numbers, revenues and profitability and strengthening our balance sheet to underpin future growth and provide financial resilience and flexibility.

Having successfully launched operations from Liverpool John Lennon Airport in March 2024, we were delighted to announce another new base at Bournemouth Airport where flying operations will commence from February 2025. This means that more holidaymakers across the South of England will benefit from our multi-award winning leisure flights and ATOL protected package holidays.

Our well capitalised balance sheet enabled the Group to continue to invest for long-term growth, including the integration of a further six new Airbus A321neo into our aircraft fleet, plus the launch of our Retail Operations Centre ("ROC") in October 2023, the first of its kind in the UK aviation industry - both will bring notable improvements to our Customer First proposition.

In August 2023, we relaunched MyJet2, offering members tailored browsing, exclusive discounts and rewards, a streamlined booking process, easy access to key information, and excellent in-resort support via the app. MyJet2 enables us to combine customer data points across sessions and devices, thus providing members with their own personalised experience.

In the past year we welcomed over 5,000 new Colleagues to our business and expanded our apprenticeship programme to include over 150 individuals who we hope, in time, will become the bedrock of our future business.

Finally, we recently updated our Sustainability Strategy, with a series of bold, clear and pragmatic actions on route to net zero by 2050, outlining an emissions reduction pathway which will bring our 2035 carbon intensity in line with the Science Based Targets initiative (SBTi) guidance. Importantly, the strategy focuses on existing technologies and tangible actions that can be taken currently, with a commitment to understanding and investing in emerging technologies as appropriate.

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Preliminary Announcement 31 March 2024

Colleagues

Our most valuable assets at Jet2 are our Colleagues who embody our culture. Personally, and on behalf of the Board, I would like to sincerely thank our talented and dedicated teams who have supported the business through another year of remarkable growth - every Colleague across the business has contributed to our success. Their commitment to continually delivering an exceptional customer experience is reflective of our People, Service, Profits guiding principles, which I firmly believe underpin the continuing success of our Leisure Travel business. Their tremendous efforts have resulted in our Net Promoter Scores remaining in the high 60s and have also culminated in Jet2.com and Jet2holidays being recognised as Which? Travel Brand of the Year for the third consecutive year, an achievement we are immensely proud of.

Board

The Board continues to evolve to ensure it provides the appropriate skills and experience to both support and challenge the executive management team. In addition to Philip stepping down from the Board, in March 2024, Mark Laurence retired following 14 years of loyal service. I would like to thank Mark for his invaluable contribution and wish him well for the future. We also welcomed three new independent Non-Executive Directors - Simon Breakwell, who has become Chair of our Remuneration Committee; Angela Luger, who is our Designated Non-Executive Director for Workforce Engagement; and Rachel Kentleton, who is taking up the position of Chair of the Audit & Risk Committee following the conclusion of the 2024 audit process. Their breadth of experience will be invaluable in supporting the business through the next phases of its development.

Financial Results

Group Revenue increased by 24% to £6,255.3m (2023: £5,033.5m). Group profit before FX revaluation

and taxation increased by 33% to £520.1m† (2023: £390.8m†) and Group profit before taxation

increased by 43% to £529.5m (2023: £371.0m).

A strong balance sheet and ample liquidity are important attributes in this industry, given its nature and capital intensity. As at 31 March 2024, our cash and money market deposits† totalled £3,184.7m (2023: £2,624.7m) with our 'Own Cash'† balance increasing to £1,331.4m (2023: £1,127.1m). Net cash, stated after borrowings and lease liabilities increased by 38% to £1,729.3m (2023: £1,249.7m). This financial capacity not only prepares us for increasing gross capital expenditure (which is expected to approach £5.0bn over the coming six years) and debt repayment commitments, but also provides a solid foundation for those opportunities and challenges that the current and future macro-economic environments may present.

Basic earnings per share increased 37% to 185.9p (2023: 135.4p).

Dividend

In view of the financial performance, our financial strength and continued confidence in the Group's prospects, in line with its capital allocation principles, the Board has resolved to pay a final dividend of 10.7p per share (2023: 8.0p), representing an increase of 34%. This final dividend is subject to shareholders' approval at the Company's Annual General Meeting on 5 September 2024 and will be payable on 23 October 2024 to shareholders on the register at the close of business on 20 September 2024, with the ex-dividend date being 19 September 2024.

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Preliminary Announcement 31 March 2024

Looking Ahead

I am extremely pleased with how our Leisure Travel business has performed in the two years since the pandemic. Not only have we capitalised on the growth opportunities presented, with the business having nearly doubled its pre-Covidrevenue, we have also remained true to our values of carefully investing to secure our long-term growth aspirations, whilst ensuring we maintain financial stability and flexibility.

With this in mind, and demonstrating our confidence in our future growth plans, we recently exercised the remaining 36 purchase rights of our Airbus aircraft order originally announced in late 2021, meaning we now have a firm delivery stream of 146 A321neo aircraft through to 2035. This valuable long-term order provides favourable operating cost efficiencies and enables us to confidently plan for the long-term as we continue to expand our footprint and the range of new and exciting destinations, ensuring we can continue to delight our Customers for years to come. In addition, our People, Service, Profits philosophy is timeless and actively guides our engagement with our most valuable asset, our Colleagues. Combined, these qualities provide a strong foundation to continue on our exciting journey in delivering on our long-term strategy, To be the UK's Leading and Best Leisure Travel business.

___________________

Robin Terrell

Non-Executive Chairman

11 July 2024

† Further information on the calculation of these measures can be found in Note 2.

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Preliminary Announcement 31 March 2024

OUR CEO'S STATEMENT

Results for the financial year

We are very pleased to have been able to report another year of strong financial results as our Leisure Travel business delivered an improvement in Group Revenue of 24% to £6,255.3m (2023: £5,033.5m) and an increase in Group profit before FX revaluation and taxation of 33% to £520.1m† (2023: £390.8m†).

These results underlined the popularity, resilience and flexibility of our holiday products and also our leading brand position, as despite the continuing inflationary pressures, millions of UK customers still chose to prioritise their disposable income for a rejuvenating and relaxing Jet2 holiday!

For the reporting period, seat capacity increased 10% to 19.73m. Although customer bookings were closer to departure, the business achieved a healthy average load factor of 89.8% (2023: 90.5%) with growth in average pricing for both our leisure travel products robust. Higher margin per passenger Package Holiday customers grew 15% to 6.08m (2023: 5.29m) and were a materially higher mix of total departing passengers at 68.3% (2023: 64.9%), with Flight-only passengers reducing by 1% to 5.61m (2023: 5.69m).

The Group commits considerable investment in order to be well prepared for its summer operations and Summer 2023 was no different, as we welcomed over 2,500 new Colleagues bringing the total number to over 15,000 at peak summer flying activity.

Although the widespread aviation sector disruption experienced in Summer 2022 was not repeated, as always, we anticipated that there would be unpredictable challenges posed by the external operating environment. As a Customer First organisation, this means investing to embed sufficient resilience into our operations, including but not limited to, standby aircraft and crews, generous amounts of in-resort customer helpers, plus responsive 'go teams' in the event of unforeseen developments. This proactive approach enabled us to effectively navigate Summer 2023 events such as Rhodes (wildfires) and Skiathos (flooding), the technological systems failure at NATS, together with the record number of air traffic control strikes across Europe and mitigate the impact on our Customers.

† Further information on the calculation of this measure can be found in Note 2.

Our Strategy

To be the UK's Leading and Best Leisure Travel business

A holiday for most UK consumers is an experience that is eagerly anticipated and, if provided in the right way, fondly remembered. Consequently, we are passionate about end-to-end customer service and our investment decisions focus primarily on how we can enrich our Customers' holiday experiences, whether embarking on a Real Package Holiday from Jet2holidays®, or simply enjoying a leisure flight with Jet2.com.

We know how much our Customers value their holidays as a stress-free and refreshing break - a time to be looked after and to unwind with family and friends, creating countless unforgettable positive memories. Consequently, our unwavering commitment to a Customer First approach focuses on delivering award-winning levels of service, where everybody is treated as a VIP. It is this philosophy which has driven Jet2holidays to be the UK's largest package holiday provider and Jet2.com to be the UK's 3rd largest airline by number of passengers flown; underpins our high levels of repeat bookings and high Net Promoter scores; and has seen both Jet2.com and Jet2holidays recently awarded the coveted Which? Travel Brand of the Year for the third consecutive year.

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Preliminary Announcement 31 March 2024

Our long-term ambition remains as relevant today as it has always been: To be the UK's Leading and Best Leisure Travel business, which demands a clear strategic vision and an unfaltering customer focus, accompanied by consistent, and often material, investment.

Our Commitment to Sustainability

Economically, socially and culturally, travel is a force for good and we are extremely proud of our positive effect in the UK and in communities around the world. However, it is also essential to recognise and act upon the environmental impact associated with travel.

Our updated Sustainability Strategy published in May 2024 details how we are taking bold, tangible actions on the journey to our Jet2 Net Zero 2050 commitment. It also reinforces our determination to embed sustainability throughout our business (In the Air; On the Ground; and In Resort) and ensure that Jet2 plc remains at the forefront of change in our industry.

We endeavour to operate in the most efficient manner possible, focusing on minimising both emissions and carbon intensity (grammes of CO2 emissions per revenue passenger kilometre (gCO2/RPK)). It is pleasing to report that the Group has continued to reduce its fuel burn gCO2/RPK from 65.9g in 2023 to 65.7g in the year ended 31 March 2024, representing positive progress towards our 2035 carbon intensity reduction target.

Pleasingly, Jet2.com was also recognised with a platinum rating for airline sustainability in the Centre for Aviation (CAPA) 2023 sustainability benchmark report. This accolade saw us included in the top 10 airlines globally for sustainability performance and ranked 4th out of 100 airlines for gCO2/RPK.

The Group has made further progress on its goal to embed the use of Sustainable Aviation Fuel (SAF) into its operations. In 2024, Jet2.com will use a 1% blend of SAF at London Stansted, Bristol and Malaga airports, purchasing approximately 1,200 tonnes almost a year ahead of the UK and EU governments' SAF mandates which are due to be introduced from January 2025. We maintain our belief that SAF remains one of the most effective solutions for reducing carbon emissions and is key to achieving net- zero status by 2050.

We took delivery of a further six new Airbus A321neo aircraft during the year bringing the total to seven with all being powered by CFM Leap engines. In addition, we recently exercised our remaining purchase rights with Airbus and now have firm orders in place for an additional 139 A321neo aircraft, thereby enabling Jet2.com and Jet2holidays to grow more sustainably over the next ten years. These aircraft are already demonstrating their efficiency through a 20% per seat reduction in fuel and carbon emissions, plus a 50% reduction in noise footprint compared to the previous generation of narrow-body aircraft. In addition, we have invested in aerodynamic split scimitar winglets for our Boeing 737-800NG aircraft which we anticipate will reduce average fuel burn by up to 1.8%.

Our actions on the ground mean over 50% of our Jet2.com-owned Ground Support Equipment is now electrified, whilst in the air we have achieved an 83% reduction in single-use plastics on our aircraft as compared to 2019.

Furthermore, in-resort Jet2holidays has implemented a Global Sustainable Tourism Council accredited hotel sustainability labelling scheme with over 950 hotel partners engaged thus far, giving our Customers the ability to make more sustainable accommodation choices.

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Preliminary Announcement 31 March 2024

In order for the industry to achieve Net Zero, we need a number of parties to play their part, including aircraft and engine manufacturers, fuel producers and, of course, the UK Government. Consequently, our specific asks from the UK Government are to:

• Upscale the UK Government's investment in SAF;
• Ring-fenceannual UK Emissions Trading Scheme revenues for decarbonisation projects;
• Work multilaterally with governments across Europe to implement Air Traffic Management reforms; and
• Support airport operators and remove obstacles around upgrades to electrical infrastructure.

More detailed information on the Group's Sustainability Strategy can be found at www.jet2plc.com/sustainability.

Operational Highlights

Retail Operations Centre

In October 2023, we were delighted to officially open our Retail Operations Centre (ROC), the first of its kind in the UK aviation industry, which will set new standards for Customer First service, efficiency and security. This 150,000 square foot facility, located in Middlewich, Cheshire, acts as a centre to stock, manage and distribute millions of in-flight retail products for customers to enjoy on their well-deserved leisure flights. The products being managed include drinks and ambient food that can either be pre- ordered or which feature in our in-flight menu, as well as products that can be bought from our onboard shop, such as fragrances, beauty products, gifts and duty-free.

The ROC facility employs cutting-edgex-ray scanners and security measures and given the nature of the operation, it has undergone thorough examination to ensure it complies with relevant regulations and has been approved by the UK Civil Aviation Authority.

Since becoming fully operational in January 2024, Jet2.com's on-board stock availability has improved materially on the levels achieved in previous years, averaging over 98%, which in turn has improved customer satisfaction. It is also pleasing that in a relatively short timeframe we have already realised revenue benefits through increased spend per head. The Group has now commenced the second phase of this initiative and in time expects to further optimise its inflight revenue potential, combining leading edge automation with customer data intelligence to create an improved, bespoke onboard retail experience.

New Engineering Hangar

With our long-term aircraft delivery stream in mind, the Group acquired additional premises at Manchester Airport to build a second aircraft maintenance facility which is expected to be operational from late 2025. This property, which is located next to our existing facility, gives us the opportunity to further build our base maintenance capability and support our growing aircraft fleet over the coming decade.

New UK Bases

Recognising the significant demand from both consumers and independent travel agents across Liverpool, Merseyside and the wider region, we were pleased to commence flying from Liverpool John Lennon Airport on 28 March 2024 with over 550,000 summer seats on sale. Our careful preparation ensured a seamless launch, so that from day one we were able to provide customers with the same award-winning service which has delighted millions of others across the UK for so many years!

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Preliminary Announcement 31 March 2024

In addition, in late March 2024, we announced the launch of our award-winning flights and holidays from Bournemouth Airport, our 12th UK base, providing greater geographical reach across the South of England and reflecting our long-term strategy to grow our successful business. Flights will commence from February 2025 to many of our most popular destinations across the sun spots of the Mediterranean and Canary Islands.

New Destinations

As always, we listen carefully to what our Customers tell us. Consequently, we added Symi and Athens Coast to our Summer 2024 programme, the latter giving customers access to eight popular resorts across the region, plus Portugal's biggest city, Porto, steeped in history and combining vibrant city life with beautiful coastal beaches.

We were also excited to announce that from Winter 2024/25 we have added Morocco to our destinations, offering year-roundsun-drenched holidays, city breaks and flights to Marrakech and Agadir, plus the launch of a new Christmas market destination - Gdansk.

Finally, for Summer 2025 we unveiled Pula on the Istrian Coast in Croatia, offering holidaymakers everything from architectural gems and historic monuments through to Blue Flag beaches, plus Costa de la Luz, a stunning, authentic and untouched slice of Spain. Each of these new destinations provide our Customers with an even greater choice of memory-making holiday opportunities.

Our Stakeholders

Our Customers

For many families, booking a holiday is the most important purchase of the year and a smooth customer journey from start to finish is paramount. We know that each customer's purchasing habits are unique and consequently we continue to offer four distinct booking channels through our website, mobile app, contact centre and independent travel agents.

Human interaction remains important for many customers when making such an important purchase, to ensure their individual needs are catered for. Currently 9% of our Package Holiday customers book through our contact centre, aided by friendly and informative homeworking sales colleagues who have an intimate knowledge of our products. Once a booking has been made, our pre-travel services team takes over, answering queries and ensuring that customers are updated with post booking information, or provided with any further pre-travel assistance as required.

Sales through travel agents remains an important distribution channel for the business, and our package holidays can be booked through all major independent travel agent chains, homeworker companies and independent agents.

Technology and how customers interact with it is perpetually evolving and our websites and mobile app are continuously developed and refined to ensure that the search and booking experience is as effortless and efficient as possible.

We have committed considerable resources to the growth of our digital channels in order to provide customers with a best-in-classJet2 mobile app experience. This has resulted in a marked increase in the percentage of package holiday customers now booking via the app of 21ppts since 2020 to 24%. We also took the opportunity to relaunch our MyJet2 account, which already has over 4.0m members. Having an account enables a seamless one-click access for customers to proactively manage their bookings in one place; engagement through competitions such as 'Bid for a Break'; and a personalised experience to optimise booking conversion via exclusive discounts on both flights and package holidays.

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Preliminary Announcement 31 March 2024