WOOD Flash – Wizz Air: 1Q FY22 – cash positive, encouraging booking trends, targeting 500-strong fleet by 2030E
Wizz Air’s 1Q FY22 (ending in June) P&L came in broadly in line with estimates, but the focus was on the impressive cash performance (the quarter was cash positive, thanks to the inflow from ticket presales) and the bullish message from the call. Jozsef Varadi, the founder and CEO of the company, believes that Wizz Air could be operating a fleet of around 500 aircraft by the end of the decade – well above what the current orderbook implies. On a more short-term perspective, the summer bookings look encouraging and, while the company cited excess supply and yield pressure, it expects to operate around 100% of its 2019 capacity in August and is flying with around an 80% load factor currently. In our view, these utilisation and load factor levels could translate into a break-even performance, even if the yields are fairly competitive. The stock was up some 8% on the optimistic outlook and the encouraging summer booking trends. We reiterate our BUY rating on the stock.Wizz Air Holding is a European airline. As of Mar 31 2017, Co. provided more than 500 routes from 28 bases, connecting 141 destinations across 42 countries. Co. has two reportable segments: the airline and the tour operator business units, marketed under the Wizz Air and Wizz Tours brand names, respectively. Wizz Air sells flight tickets and related services to external customers and, to an extent, to Wizz Tours. Wizz Tours sells travel packages to external customers covering the network of Wizz Air.
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