British low-cost airline easyJet doubled its dividend after annual results showed it took business from fading European rivals and customers bought more cheap flights for late summer holidays. Competitors are struggling to deal with high fuel costs, weak consumer confidence and the eurozone crisis. Some ceased operations this year, leaving gaps in the market that low-cost airlines have been quick to exploit.
IAG's Spanish carrier Iberia said this month it would axe almost a quarter of its workforce and rationalise its network. Germany's Lufthansa said it would deepen cost cuts to counter the rising fuel prices and limited market growth. "Set against the difficulties which the industry has been facing, typified by the recent Iberia announcement, easyJet has managed to shoot the lights out," said Richard Hunter, head of equities at stockbroker Hargreaves Lansdown. "The doubling of the dividend was a clear statement of management intent around easyJet's prospects."
Shares in EasyJet, which have risen by 80 percent this year compared to a 17 percent rise for the FTSE 250, were up 6.3 percent at 694.25 pence by 1053 GMT, valuing the airline at around 2.75 billion pounds. Europe's second-largest budget airline after Ryanair reported pretax profit up 28 percent at 317 million pounds ($504.46 million) for the year to the end of September, at the upper end of its guidance.
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