MARKET REPORT: Wizz Air loses altitude as recovery lags rivals

Shares in Wizz Air fell over fears that the pace of its recovery would lag behind rivals.

It enjoyed a surge in ticket sales which helped revenue more than double to £802million in the three months to December. That came as it carried nearly 12.4m passengers in the third quarter, up 59.1 per cent on the same period a year earlier.

Its load factor – how many seats are sold on every flight – rose 10.2 percentage points to 87.3 per cent.

Wizz swung back into a profit of £30million, having made a loss of £235million a year earlier.

While still on course to make a loss at the end of the current financial year, it has eyed a return to profit in the year to April 2024.

This stood in contrast to the update this week from Easyjet, which said it will be back in the black this year after three years of losses. It also reported record bookings for summer holidays.

Asked if Wizz had seen the same, its boss Jozsef Varadi said: ‘Bookings are strong, but I don’t want to get over-excited. We are seeing the market remaining intact. People continue to fly.’

There was upbeat news for Jet2 as the airline and package holiday firm upgraded its profit forecast for the year with bookings for next winter ahead of where they were before the pandemic struck.

As a result, profit for the year to March is expected to be between £370million and £385million, far higher than the £317million analysts expected.

Wizz sank 7.2 per cent, or 216p, to 2796p while Jet2 added 2.5 per cent, or 29.5p, to 1207p and Easyjet rose 0.3 per cent, or 1.6p, to 515p.

The FTSE 100 ended its two-day losing streak with a return to positive territory – up 0.21 per cent, or 16.24 points, to 7761.11 while the FTSE 250 climbed 0.56 per cent, or 111.47 points, to 19915.51.

Stock Watch – Inspecs

Eyewear firm Inspecs enjoyed its best day on the stock market after business picked up on multiple fronts.

The Bath group made £216million of revenue in 2022 – similar to the 12 previous months – while freight costs have fallen and losses narrowed at its lens making business Norville.

Having delayed expanding two factories in October, a rise in orders means construction will begin during the second half of 2023. 

Shares, which floated at 195p in 2020, jumped 50.4 per cent, or 31.5p, to 94p.

Official figures in the US showed that the economy grew at an annualised rate of 2.9 per cent in the final three months of 2022. 

This beat estimates of 2.6 per cent but still fell short of the 3.2 per cent growth rate delivered in the previous quarter.

Back in London, Prudential is poised to open a branch of its Hong Kong business in Macau, lifting the insurer’s presence to 24 markets across Asia and Africa. It rose 2.8 per cent, or 37.5p, to 1371.5p.

Private equity firm 3i soared 9.2 per cent, or 134p, to 1594p after bumper results for its largest investment. Action, the non-food discount retailer which owns more than 2,000 stores in 10 countries, reported a 30 per cent rise in sales and 40 per cent increase in profit for the year to January, as affordable prices attracted more customers.

Wealth manager St James’s Place rose 1.5 per cent, or 17.5p, to 1217p after brushing aside the turbulence in financial markets to deliver its second-best year for securing new money. 

It raked in £3.9billion in the three months to December and reported £2.1billion of net inflows, taking the total across the year to £9.8billion.

IG Group revenues rose 10 per cent in the six months to November to a record £519.1million. 

The trading firm said clients found ‘opportunities to trade’ despite economic pressures around the world. Shares inched up 1.3 per cent, or 10p, to 790p.

Britvic, the drinks maker behind Robinsons, saw revenue rise 9.9 per cent to £411million in the three months to December on the back of strong trading during the festive period.It fell 1.3 per cent, or 10p, to 764p.

There was little to cheer for Greencore as the sandwich maker warned its slow start to the year, made worse by industrial action, and soaring labour and energy costs, would mean its results will be weaker than hoped. Shares plunged 3.3 per cent, or 2.55p, to 73.9p.

Elsewhere, shares in Applied Graphene Materials will be suspended from February 1 after it admitted it will miss the January 31 deadline to publish its accounts. It dipped 8.9 per cent, or 0.6p, to 6.15p.