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Holiday firm Jet2 will be watched closely for any hints that fares will rise to offset soaring fuel costs when it reports half-year figures on Wednesday.
The package holiday giant – which is also the UK’s third largest airline – has until now seen bookings remain resilient despite the Iran war, saying in September that it saw summer passenger numbers jump 8.8%.
But the sector is increasingly coming under pressure as sky-high oil prices have seen the cost of jet fuel rocket.
British Airways owner International Airlines Group (IAG) said earlier this month that its fuel costs had jumped by nearly a third – 30.4% – or 570 million euros (£471.9 million) in its third quarter.
IAG said it was hoping to “pass through” close to 100% of British Airways’ higher fuel costs over the full year, but declined to give details on how much fares were rising or the outlook for prices going forwards.
Ryanair said recently it was considering pay freezes and increased use of AI to help offset a surge in fuel costs next year and warned over a double-digit rise in fares next year across Europe.
Jet2 has already said it had been able to largely hedge against higher jet fuel costs for the financial year, which provides “cost certainty”, though the outlook past the current year will be keenly watched.
The results come as Jet2 plans to move its listing up to the main market of the London Stock Exchange from the AIM (Alternative Investment Market), set to happen in December, and it is expected to be added to the FTSE 250 in the next quarterly review.
This means graduating from London’s growth market and opening the door to a broader range of UK and international institutional investors.
Jet2 chief executive Steve Heapy said in September that the move reflected “the scale of the business we have built, our proven track record of delivery and the opportunities that lie ahead”.
Richard Hunter, head of markets at Interactive Investor, said: “Contrary to popular belief, Jet2 is no minnow.
“It is the third largest airline in the UK behind British Airways and easyJet, ahead of TUI and Virgin Atlantic.”
He added that the group’s robust update in September means “expectations for the interim results will be flying high”.
But he cautioned “the macro environment remains cloudy and the propensity of customers to book late will continue to provide challenges”.
“The current macroeconomic and geopolitical concerns add to a potentially dangerous mix, underlying some of the potential hazards of investing in the airline sector.”