Earnings call transcript: Wizz Air Q2 2025 highlights growth and challenges

Wizz Air Holdings PLC reported a solid financial performance for the second quarter of 2025, with revenue increasing by 9% year-on-year. Despite a decline in stock price by 2.46%, the company showcased robust operational and financial metrics, including a significant increase in EBITDA and operating profit. The airline also addressed strategic adjustments to its operations and provided insights into its future growth trajectory.

Key Takeaways

• Revenue increased by 9% year-on-year.
• EBITDA rose by 19%, with a margin of 29%.
• Operating profit surged by 25%, achieving a 13% EBIT margin.
• The company ended the half-year with 2 billion euros in cash.
• Wizz Air closed its Abu Dhabi base and reduced Vienna operations.

Company Performance

Wizz Air demonstrated resilience in Q2 2025, with significant improvements in key financial metrics. The airline’s revenue grew by 9% compared to the previous year, driven by an 8.9% increase in Available Seat Kilometers (ASK). However, Revenue per Available Seat Kilometer (RASK) remained flat. The company also marked a 19% rise in EBITDA, reflecting its efficiency in managing operational costs.

Financial Highlights

• Revenue: 9% increase year-on-year
• EBITDA: Up 19% with a 29% margin
• Operating profit: Increased by 25% with a 13% EBIT margin
• Cash reserves: 2 billion euros
• Net leverage ratio: Reduced from 4 to 3.6

Outlook & Guidance

Looking ahead, Wizz Air anticipates a challenging second half with mid-single-digit capacity growth and potential pressure on RASK. The airline is focusing on productivity improvements and long-term balance sheet optimization. The company is also considering market entry into Ukraine, contingent on geopolitical developments.

Executive Commentary

CEO József Váradi highlighted the company’s strategic adjustments, stating, "We are seeing that addressing around a 10% growth rate versus 15% is taking some of the risks out of the equation." He also noted, "The single biggest risk is around the supply chain," emphasizing the challenges faced in maintaining operational efficiency.

Risks and Challenges

• Supply chain disruptions are a significant concern, potentially impacting aircraft deliveries and maintenance schedules.
• The geopolitical situation in Ukraine poses risks to market entry plans.
• Pressure on RASK and capacity growth could affect short-term profitability.
• The airline’s strategic exit from Abu Dhabi and reduced Vienna operations may impact market presence.

Q&A

During the earnings call, analysts inquired about the company’s GTF engine maintenance challenges and its aircraft fleet strategy. Executives provided clarity on the rationale behind the closure of the Abu Dhabi base and addressed competitive dynamics in the Central and Eastern European markets.

Full transcript - Wizz Air Holdings (WIZZ) Q2 2026:

József, CEO/Executive, Wizz Air: Come to this event. This is reporting the first half results of fiscal 2026. Could you move to the next slide, please? I would say that we start seeing some sunshine and certainly good decisions for the future, waiting to see the impacts coming through. With regard to the sunshine, I think what the first half results demonstrate is that under circumstances when we are near efficient, actually business produces very strong results in terms of operating KPIs, in terms of financial outputs. We are still not fully efficient given the groundings of aircraft, some of the inherent inefficiencies in the industry system, but we did a lot better than in previous years. As a result, you can see significant increase on capacity, passengers, revenue, and profit.

In terms of decisions made, we’re seeing that we have affected the major challenges of the business for a structural reset. We have communicated the closing of Wizz Air Abu Dhabi, that effectively has been happening. It is pretty much done there. We communicated that we would be seeking a reset with regard to the aircraft delivery stream with Airbus. That deal is now in place. It has been decided, and I think it’s a good deal. It is appropriate to addressing a number of things. One is the deliverable growth rate of the business, taking some risks out of the profile of the setting, reducing the growth rate to around 10-12%. Let’s not forget that 10-12% still makes Wizz Air the fastest growing airline in Europe, which we are proud of.

It is a more manageable magnitude of growth than previously. Very importantly, it takes into account the cycle of the pre-term witness groundings and on groundings, because that created a significant hiccup to the fleet count of the airline, which we had to reset. Also, we addressed the XLR exposure. That program is de-scaled very significantly. I would even say that exited, to a large extent, and now this is narrowed to the U.K. AOC. So the XLR is seen as a Wizz Air U.K. initiative, no longer as a corporate initiative for the airline. Also, we have made commitments on aircraft finance. This is one of the significant differences to our competitors, and you will start seeing a more balanced way of financing our aircraft delivery program going forward.

Now, with regard to growth, I think this is important, and you have a prime interest in that. We are looking at capacity growth of around 10-12%, to be delivered through the recovery of the GTF engines, the new aircraft delivery streams, and the way we are managing capacity. Now, what it really means is that we will still have some short-term challenges in front of us arising from capacity, because effectively the choice we have on hand is either being fully efficient and fully deploy capacity, but that would create an excessive growth rate, which would become highly dilutive to revenue production or carry on some inefficiencies on the fleet, but set the growth in accordance with what actually we can deliver.

We opted for the second, so you’re going to be seeing a moderated growth level from here on, but it will take a little time to suck up the inefficiency created. We have been shifting a lot of focus in terms of markets. We have been talking about this to Central East Europe. If you look at Central East Europe, it is now kind of bearing fruits in terms of market share. We are expecting our market share to be around 29%, going into the first half of calendar 2026. This is up from 25%. Of course, we have been adding significant capacity by opening new operating bases and also enhancing our incumbent footprint. With all these, we are expecting a stabilized, more resilient revenue production and a longer-term lower cost production of the business and also the strengthening of the balance sheet.

Maybe with that kickoff, I would hand it over to Ian, and I will take it back after that. Thanks.

Ian, CFO/Financial Executive, Wizz Air: Thank you, József. Next slide, please.

József, CEO/Executive, Wizz Air: Right. In terms of H1, I would say that, you know, pleased with the outcome. And, you know, we do not want to dwell on it too, too long, but at least, you know, we are here to report on it. I will talk about it, but then we want to make sure we look forward into H2 and beyond that. Revenue up 9%, nominal off of 8.9% ASK growth. RASK was roughly flat, year on year, $0.0498. A strong RASK production, flat load factor. That was a yield was up around 0.9%. Ultimately, I think a good top line number, helped also by fuel. Fuel was down 2.1% despite the 8.9% volume increase, benefiting from the fuel efficiency and the fuel price, and the impact of our hedging. EBITDA was nicely up 19% with a 29% EBITDA margin.

Operating profit was up 25% with a 13% EBIT margin. Across the board, I think a strong result. We did see some things below the line that eroded some of the net profit, even though we still generated a positive year on year net profit production. None of this was unexpected. We have the tax charge with regards to the deferred tax asset that we created last year and the unwind that happens as the aircraft start delivering into that entity in Malta, which we structured and set up last year. Ultimately, I think where we’re looking at is a satisfying result. As Joe says, as we continue to build operational performance and operational resilience into the business, you can start to see the benefits of those flow through into the P&L. These are structural.

These are things that we’ve invested a lot of time and effort into. Last summer was a rather disruptive summer, and that’s where you see the benefit coming into this year. You’ll see less of that benefit in Q3 and Q4 just because we had better performance. We can expect, as we’re continuing to grow, that operational performance to deliver a more robust cost position and ultimately a more beneficial revenue environment because you’ll start to deliver operational performance, which drives better revenue quality. We’re excited about the structural changes and the resilience coming into the business. Into the winter, and into the cost base, if you could just go to the next slide, please, we will see transitional inefficiencies. Now on the cost side, I would say, you know, we’re pleased with the results.

The cost picture really improved in Q2. You can see that was driven by fuel. Fuel was a tailwind there. The disruption cost, as I mentioned, the operational efficiencies generated roughly EUR 29 million of savings in terms of disruption costs. That was helpful. We also managed to shed some of the structural wet lease costs. We were down EUR 76 million in terms of wet lease costs. We still do incur wet leases, but these are not structural. These are one-offs. Actually, embedded within those wet leases is also some of the short-term engine leasing that we do in order to make sure that we can operate the fleet efficiently and reliably to be able to support better on-time performance and the avoidance of disruption costs.

We also managed to deliver strong results even with lower sale lease back volumes. You can see that we actually were EUR 27.5 million short on sale lease back gains year on year. Had we had that, that would have been an even better picture. Those were the tailwinds. We continue to see elements of cost creep through the business. Like I said, none of this is a surprise. There is nothing new based upon what we were expecting at the full year when we said that this year was going to be a challenging cost year. This is just simply the translation of some of our actions into the results, which will then wash through and move on, going forward. You can see that, for example, airport and en route are up.

Actually, handling came down, but where the biggest pressure came from was on en route, where we saw an increase in the tariffs year on year. For example, places like Germany, en route charges were up 29% year on year. Those are really hard to unwind. Maintenance is an area that we see a lot of cost pressure. As we explained at the full year, there are a number of things happening there. We are seeing the retirement of CEOs now in that period. We think there were nine CEOs that went back. As you put those into return conditions, you have to incur incremental costs, not normal operating costs. You see some of that flow through. You also are seeing pressure in terms of the vendor base. Component support contracts are increasing.

Some of that is inflationary coming through the cost line. There is an element of Abu Dhabi windup costs coming through the entire cost structure. In terms of Abu Dhabi costs, we remain comfortable that there will not be an adverse impact on the full year to winding up Abu Dhabi. While you will see cost increases across all the cost lines associated with the windup, the benefit of not operating Abu Dhabi from September onwards will offset that so that it should be at least break-even, if not maybe slightly better, but we will know that when the entire business is wrapped up. We thank the team for all their efforts in terms of that operation as well as what is happening to shut that down.

Distribution was up slightly, but that was consistent with the Q1 results in that we have a return to growth. As you do push more volume through the business, you are incurring more costs associated with that. That was expected. Like I said, there are a bunch of cost increases happening in the others line, associated with the return to growth. There are things like crew training, crew accommodation, recruitment, things like that. Abu Dhabi costs flow through that to some extent as well. There was also a reduction, if not even an elimination, in some limited cargo revenue that we had in the prior year that we did not have this year. That is what explains the others line within the other cost and income line.

I’ll ask to go to the next slide. Just quickly touching on Q2. Again, operating margin of 21.5%, 35% higher year on year. We saw less benefit on FX in the quarter versus prior year due to the now continued ramp up of our overall lease liability hedging profile and risk management profile. We saw a very strong disruption cost reduction again. Most of that disruption improvement came through in the second quarter. That is despite some of the challenges we have in Q2, such as the suspension of Israel operations, which resumed in August. We also had the overfly challenges around Iran. We had actually a lot of volatility around Abu Dhabi as we worked to come to the end of that operation at the end of August, early September, beginning of September.

There were some tapering off of the operations there, and that caused some additional disruption and costs. Notwithstanding all those things, a very strong Q2, and something that we’re proud of, but we’re not going to rest there. In terms of where we’re going, we have obviously some guidance numbers that Joe will share at the end. That puts us in a position where I think we’re comfortable with our consensus currently. We do expect there to be a higher cost position in Q3 and Q4. Like I said, nothing that’s a surprise. That’s driven by a number of factors. If you look at things like the maintenance line, we’re going to see older aircraft costing more to maintain. There’s going to be continued retirement of CEOs in that period, which drive the costs up.

Depreciation is going to see some pressure because in H2 we should be 35 more NEOs this year versus last year H2. That translates to roughly 20% fleet growth, whereby in that period we should only be growing around 10% in terms of ASKs. Our nominal depreciation will grow faster than our volume growth. That is why you’ll start to see some pressure on that. We also have in the second half a distortion when it comes to the year-on-year comparable in maintenance. In fiscal year 2025, we had a one-off maintenance accrual release, which was rather material, close to EUR 80 million. We’re not going to see that again. That is why you see some of the cost pressure flowing through.

Joe will comment on why that is necessary and why the actions that we take and the costs that come with those actions set us up for not just the performance that we are delivering next year, but also the overall reprofiling of the business. I will ask to go to the next slide, please. In terms of cash flow, I would say consistent at the end of the day, consistent with what we have been seeing. We ended the year, sorry, ended the half around EUR 2 billion in cash. That puts us in a strong position going into the winter. We managed to generate a reduction in net leverage ratio, so down from 4 to 3.6. We maintain our target of 30-35% liquidity, actually made it to go up, which is good.

That is also in anticipation of our January bond repayment, which we plan on, at this point, treating the same way we have the previous repayment. We are pleased with the Airbus developments and that comes with pros and cons. Obviously, as you defer aircraft, you generate fewer, say, at least back gains, but you also generate fewer lease liabilities as you defer CapEx, which means that should be benign in terms of leverage at the end of the day. It also has a benefit of releasing PDP obligations as we now no longer need to fund the development of those aircraft. As I am sure some of you have noticed, we have managed to sell a few aircraft as part of a deal with one of our related party airlines.

That also takes further pressure off the CapEx side of things. Overall, nothing jumping out in terms of this chart. As we move into the Christmas period, into Easter, into March, we’ll see that unfilled liability line start to build again as we’ve seen in prior periods. We’re comfortable with the liquidity position of the company. I will note that we rolled over our ETS facility. We had a EUR 279 million facility that rolled over like we did in the prior year. Due to the changing prices of the emissions credits, we were able to slightly upsize that. Next slide, please, and I’ll hand the floor back over to Joe. Okay, thank you.

This is, I guess, a very important chart that kind of gives you the picture on fleet growth and this translation into capacity growth. You recall that we are having 334 aircraft on hand to be delivered, originally set for a stream ending in 2030. Now this is extended to 2033. Effectively, that affects a 91 aircraft reduction in the original delivery period and puts that across into the extended period. Of the 91, three aircraft are sold out, right? And 88 are deferred into 2031-2033 deliveries. What it does is, it creates a more predictable picture for future growth. In terms of volume of growth, we are targeting around 10-12% annual growth.

This is taking into account, you know, some of the issues of recent experience that, you know, given the, some of the inefficiencies associated with the Pratt & Whitney groundings, we want to make sure that, you know, we are de-risking the profile of the business, not only in terms of market footprint, but also in terms of, you know, challenges arising from growth. We are seeing that the 10-12% growth is a more de-risked profile for the company than 15% originally targeted. Taking into account the Pratt & Whitney GTF cycle of grounding and on-grounding, you appreciate that, you know, the new free delivery program has to take that kind of a recovery cycle into account and recovery path into account.

If you look at it in nominal terms, effectively, you know, short term, we do not take new aircraft deliveries, representing 10%-12% growth. It is a lot less than that because we are taking into account the recovery of the current grounded aircraft on entrance. We are seeing that this is a fairly well outlined model, mathematically, to program the growth or deprogram the growth against a lower risk profile of execution. I am very pleased with that. It was a long negotiation. You can imagine that this is very thorough, not only in terms of setting or resetting the delivery stream, but also in terms of protecting the commercial terms of the deal.

Again, just for recording it, this deal was actually put in place in 2017 in Dubai, under very different supply chain circumstances, very different commercial and financial needs of the OEM. Obviously, that gives continuously a structural benefit for Wizz Air versus the rest of the market. We’re seeing that now it is not going to become a burden when it comes to executing the aircraft order. In 2029, effectively we are becoming an all NEO operator. That’s good because, by the time, I think you should be reasonably expecting technological maturity coming through, by the time the GTF advantage will be delivered. I mean, that’s a significant technological step up, and an industrial step up on durability and reliability on the entrance.

The other important issue here is the XLR program, which is now taken down, rescaled, and allocated to Wizz Air UK, no longer to the European AOCs. Next slide, please. Decisions have been made, are being made, and now we are expecting the impacts coming through. The critical decisions I said before, the closure of Abu Dhabi, you heard from Ian that we expect that decision to be executed against a fairly benign financial platform. We are not expecting any adverse impacts in the current financial year as a result of that. As of the next financial year, we are expecting significant upsides coming through. Just discussed the Airbus order reset again. This is very important for longer term predictability of the business and also discussed the XLR program, which we effectively exited, other than Wizz Air UK.

Now there are, next to this, ongoing work streams. Network improvement, churning the network for profit. That’s probably the most important ongoing priority of the company. We are shifting capacity into Central East Europe, against high brand awareness, against very solid financial performance, and against a backdrop of disproportionately higher GDP growth in that region relative to Western Europe. We are already seeing some of the early results by opening new bases, deploying more aircraft, how quickly the market is picking up on Wizz Air. We are optimizing the technological platform. Maybe just one equation we have been discussing, but I think you should understand that when we are talking about the GTF or any new technology, it’s the same for the CFM LEAP.

There is a trade-off, and the trade-off is, you get fuel burn benefit from heat in the core of the engine. Basically, the way fuel burn benefits are derived is through the higher temperature in the core of the engine. What it means is that higher temperature is more sensitive to durability of the core of the engine, of the whole engine. That may result in more maintenance costs. This trade between, you know, fuel burn versus maintenance. It’s not like you just get fuel burn as a gift. Of course, there is another element of technology improvement, and that comes from the capital cost. It is simply more expensive than previous technologies.

Please just understand this trade, because when you look at ex-fuel costs and fuel costs, you’re going to be seeing that, okay, we are delivering a lot of improvements on fuel costs, but not as much on ex-fuel costs. There is a trade here. What you see coming through the fuel costs, you’re going to get some of it as a penalty on non-fuel costs. You really have to look at the two combined. I mean, of course we do the breakdown and we act on the breakdown, but, you know, intellectually I think we need to integrate those two if you want to fully capture that.

We’re seeing that the technological benefit is important because once the GTF is matured, the industry has no doubt that this is going to become the best engine available in the marketplace. It is kind of painful at the moment going through this cycle, but we are hopeful that one day actually we’re going to be praising the day when we decided to offer this engine. And unparking the aircraft, that’s a critical priority for the company. We have been discussing this. We are targeting to on-ground the entire fleet by the end of 2027. We are working with Pratt & Whitney.

We have an understanding, we have a deal with that regard that covers induction slots, that covers spare engine purchases, and that covers OEM’s capacity in terms of parts and in terms of shops and engineering to support that recovery program. This is the line at the highest level at the company, not even at Pratt & Whitney level, but at Raytheon level over there. A lot of ongoing issues happening, but I think all for the better. Next slide, please. I think Jan has started alluding to this, that if you look at fiscal 2026, it is almost like two halves for one year. A somewhat shining first half and somewhat challenging second half. In terms of capacity, we are looking at mid-single digit seat capacity growth, somewhat less than ASK.

You recall that we eliminated quite a number of long routes, operated to hot and hot. That is why the ASK numbers are somewhat different from the seat numbers. Mid-single digit capacity growth, this is in line with our ongoing growth ambitions of the company. Really, the option we had available to us here was, you know, we are growing 30% with efficiency in terms of unit cost, or we are going 15% with efficiency for revenue, but with some compromise on unit cost. These were the two choices to make. We opted for the second one because we are seeing that we should be alloting capacity against demand in the marketplace as opposed to alloting capacity and trying to find demand for that capacity.

That will bear some kind of a challenge, in terms of short-term cost to the unit cost to the business. Load factors, I think we are trending well on load factors. The performance is strengthening. We are expecting some upsides on load factors coming through. With regard to risk, again, I mean, we are too early into the winter to really make a firm position here. We are expecting some pressure. I mean, 15% is still significant growth in the business. It is a lot ahead of the growth of other airlines. This is the off-peak period, the kind of the weaker half of the financial year from a demand perspective. We might be expecting some pressure on RASK, although we are also seeing some good positive signs on that.

We shall see, but this is our kind of early indication. How would that translate into cost, performance of the business? Obviously, fuel will continue to do well, given the current fuel price in the marketplace and given the transition to NEO technology and the benefit of fuel burn coming through the GTF engines. Ex-fuel cost will be temporarily on the rise as a result of this kind of capacity and efficiency we carry in this period. Over time, this is going to be socked up. If you look at fiscal 2027, when we are taking down the new aircraft deliveries and contemplating some recoveries of GTF engines, in that period, this kind of inefficiency is going to be socked up.

All in, it is a challenging first half, sorry, second half, what we are into, although some of the good things, the good decisions we carry through this period, and certainly you are going to be seeing more benefits materializing in the next financial year. I think with that, I would turn it over to questions, please. Morning, Jamie Wetham from Deutsche Bank. Two from me to kick off. Maybe first one for József. On-time performance was, I think, 60%-ish, up from 50%. So a good improvement, clearly helping your disruption costs, but that is still very low versus, I think, your pre-COVID standards and industry standards. Why is that? And where do you think you can get that to one year out, please?

And then secondly, maybe for Ian, the situation you find yourself in, as you described on the cash flow bridge, saw that the net CapEx positive EUR 190 million in H1. Now you’ve got the Airbus deal done. Is there more clarity you can give us on what the full year equivalent of that number might look like, or is it still very contingent on engine sale and lease backs, et cetera? Thanks. All right, maybe I start with on-time performance. Yes, it is a significant improvement. I think the difference is that we are just up against a very different supply chain context. ATC remains to be a challenge. It was less so this summer than in previous years. We have to admit the progress they have made, but that does not mean that they are virgin.

There are still lots of issues coming through, ATC. Our performance relative to industry completion, we are the best airline in Europe. On-time performance, we are right in the middle of the pack. Is this good? Yes, relative to the industry’s performance, I think it is good, relative to our expectations and historical performance. We want to see improvement coming through, but I think we need to see more improvements coming through the supply chain as well. Now, the issue that you have, and you probably appreciate this. You are in the summer period, when demand is almost unconstrained. The more compromises you make on your operating model, what compromises do you make? I mean, you may compromise on sparing more capacity so that will take down utilization.

I mean, you are running the airline at lower utilization rate in the middle of the peak demand period. This is going to be defeating your financial performance. You have to kind of strike the balance here and find that kind of a sweet spot that benefits your operating program against the revenue and demand upside of the business, without really screwing it up completely operationally. I think previous years, in previous summers, we might have opted overly for trying to get more commercial upsides from the business and undermining operational resilience. I think we put more efforts into the balance now that we want to have commercial upsides, but at the same time, we want to protect operational resilience as well.

I mean, that’s how well we could have done, but we need to see some improvements in the supply chain, to be honest, to have significant upside here. We are not underperforming versus the industry. Thanks, Jamie. With regards to cash flow, the Airbus news is new, right? We announced it this week, and we are in the process of trying to identify when the right time is to do a capital markets data, walk you through the longer-term strategic direction on all these exciting topics, particularly with regards to aircraft financing, engine financing, and things like that. As I mentioned earlier, we should be 35 A321neos in higher count this second half versus last second half. There is also going to be an element of engine sale lease backs that happen in there.

These are the contractual obligations that we have. We are not doing anything above and beyond at this point other than upholding our contractual obligations. Other than the three aircraft that were sold, I believe there is only one aircraft that was deferred out of fiscal year 2026. The Airbus impact is very limited to fiscal year 2026 and in fact fiscal year 2027 because there is not much you can do. That is why we are having to manage the capacity through, as Joe said, utilization and things like that, which come with its drawbacks, which, you know, we are very utilization focused. We need to balance the revenue dilution with regards to the capacity management.

In terms of the cash flow for the full year, you will see cash flow benefits coming from the delivery of those aircraft. You will see cash flow benefits coming from the delivery of those engines because we still do a form of sale lease back, whether it’s an operating lease where you get the upfront gains that come through the sale lease back line, or whether you do a Joelco or a finance lease where you also do a sale lease back, but you do not get the same P&L impact. You get the cash benefit, but a different P&L impact. Roughly 20% of our deliveries right now are being financed through a form of ownership like Joelco or finance lease. That is effectively an ownership structure, even though there is a lease structure behind it.

We plan on taking the next step, as we mentioned before, into looking at an acquisition-based, more true, more, you know, sort of conventional acquisition-based approach. We’re rerunning the numbers now based on the order book to optimize where we think the earnings profile will get to over the rest of the decade, and that will then calculate how many incremental aircraft we need to buy. Then we’ll look at the financing sources, whether it’s a lease like a Joelco, or whether it’s, you know, some sort of acquisition either with cash or some sort of other kinds of financing. That’s part of the capital markets day exercise.

What that will do and what these acquisitions do is take away sale lease back gains, which, you know, are very chunky upfront, and it’ll spread it out in line with the depreciation and interest costs you take over the life of the asset. There are trade-offs to that, but ultimately we have determined that over the long term, it is beneficial from a shareholder perspective, but it comes with a near-term impact. That’s what we’re trying to balance, that we continue to do a bit of both to smooth out the earnings profile of the business ultimately towards something that’s beneficial and giving a better shareholder return. Thanks, Alex Irving from Bernstein. Two from me, please. First of all, on your revised CASK X guidance for the year.

Full year results, you’d said up slightly, now we’re saying up mid-single digit. Can you help me understand how much of that is the mechanical impact of taking your expected capacity growth from 20 to 10, and how much of that is an, say, an underlying variance versus your prior expectations and planning? Second, you’ve launched a Eurobiz product recently. Is this sort of a no-regret move that if it doesn’t work, we can just sell the middle seat anyway, or is there a real revenue opportunity that you’re expecting to get from this? If so, could you quantify that, please? Sure. Let me take the first one on the CASK. Yeah, please. The answer is, as I said before, there’s no surprises this year in terms of the CASK number.

It is really more a matter of the capacity impact where we are basically growing half of what we expected. We had sized the business and budgeted the business for a bigger business and the business that involved Abu Dhabi and things like that. We have now changed it dramatically, but still trying to manage through these costs. There is nothing that has caused any sort of variation on that. We do need to maintain cost discipline, and that is our focus. It goes, as I mentioned earlier, there are distortions and all sorts of other things that are pushing pressure on that. There are no surprises on that front. I think the middle seat is sheer revenue opportunity. I mean, at the moment, effectively, we do not get the middle seat occupied.

If you look at the numbers, it’s almost like no one is paying for that. Now, we want people to pay for that. Morning, it’s Harry Gowers from J.P. Morgan. First question, maybe just how to think about growth into next year in March 2027. I think you said, or mentioned, that obviously the deferral of deliveries is quite back-end loaded. How much are you expecting to grow next year and anything you can say directionally on costs yet for March 2027? Second question, with the Abu Dhabi exit, Vienna-based closure as well, is this the end of, you know, quite major airport or market movements, or do you have any more exits or, you know, big exits in the pipeline?

And then last one, just on the, on the medium-term growth, I mean, when you were negotiating down on the deliveries, how did you settle on like the 10-12% as the right number? So just, you know, kind of what’s the thinking mathematically or strategically behind that, you know, why not 7-8%, for example? Thanks. All right. So, maybe I start with the last one, the 10-12%. So we always saw this business is structurally designed to deliver 15% growth at 15% margin. You remember that was sort of the model of what we promoted. Now given all the issues and hiccups, we broke down on the delivery of the, of the model, and we tried to reinstate that, that model, but we’re seeing that short term, short-medium term, we need to ease, the delivery of that, of that model.

That is why we are seeing that, you know, addressing around a 10% growth rate versus 15% is taking some of the risks out of the equation when it comes to capacity. Why not 7% or 8%? Because if you look at our focus markets, especially Central East Europe, Central East Europe will demand more than that. We have been modeling this. We have been looking at GDP growth expectations in the region and how that would translate over to airline demand and how we can translate it into our own capacity versus, you know, the competitive games we are into and our ambition to continuously lead the market in Central East Europe. We are seeing that this is kind of the sweet spot.

The 10-12% is a bit of a sweet spot analysis from the perspective of demand in our core markets, versus the deliverability of the program from an operational standpoint, how much financial distress we are putting on the system to ramp operations up against that target. With regard to Abu Dhabi, Vienna, and others, I think the way I would see this is that, while Abu Dhabi is a very structural decision, Vienna is less so. I think Vienna is seen as pretty much business as usual. Maybe the magnitude is reaching a bit higher than usually. I mean, the Austrian government decided to put excessive taxes on the aviation system, effectively making Vienna prohibitive from a cost perspective, you know, for us certainly.

We are not the only guy acting. Clearly, this is not a visa issue. This is a bigger industry issue. I would say that this is fairly exceptional in terms of magnitude. Now, with regard to Vienna, I think what is easing the situation is the availability of Bratislava, which is pretty much next door. This is kind of fairly easy. Churning the network for profit, I mean, you should be expecting us to do that on an ongoing basis. Of course, you know, the same thing goes for airport costs. If an airport becomes excessively expensive, then we would be churning that capacity for lower cost execution. I would say that these are ongoing priorities.

If you ask the question whether we have made the big decisions, I would say yes. The rest would be pretty much the refinement and business as usual. Do you want to take the growth? Sure. Just on the growth side, right? Like what we’ve done with the Airbus deal and what these other deals that we’re looking at is give ourselves optionality at the end of the day. We bring, we’re going to bring things down in the medium term, the 10-12%, but it doesn’t mean that we’re limited at 12%. We’re still a growth stock. We’re still a growth company. We’re not afraid of growth. We have 58 aircraft or so redelivering between fiscal year 2027 and fiscal year 2029. Most of those aircraft have extension options in them.

If we see that there’s more demand, we can exercise those extension options and capture that demand. I want to make sure that we’re not somehow, you know, thinking that we’re constrained. We have optionality. That’s what we’ve effectively negotiated for ourselves versus before we were committed to deploying that growth. In terms of fiscal year 2027, I think it’s still going to be a very challenging ASK and seat growth environment, closer to 20% still, at least in the near term. That’s something that we’re going to have to manage through, in terms of the deployment of all that. It will probably end up having an impact on utilization.

It’ll also force us to, you know, be more measured. I think with the changes that we’re doing around the network and the market share that we want to develop, it is again an investment, but I don’t think it’ll have as adverse of an impact on costs as you might be thinking in terms of where you’re going with this question. Looking at the cost side of fiscal year 2027, we’re not guiding. It’s far too early to say, but I would say that the worst is behind us because we’re still, you know, that growth will help us at the end of the day in terms of the costs.

We think that, you know, the changes that we’re making to the airport side in particular, right, hard, real changes will bring down the cost side of that. I think that, so looking at our cost structure, you’ll see depreciation probably be the biggest benefit because we start to flush out some of these seals if we don’t extend them. You’re going to start to see, and you’ll see maintenance still be one of the ones that sees the most pressure because of the heightened activity associated with redelivering and the aging of the fleet. Everything else, I would not expect there to be any challenge in terms of bringing costs, keeping costs flat or down. Okay.

I think that overall the cost creep is where we are now, and then you start to see improvement after that in fiscal year 2027. I would just add one more perspective. I mean, none of our plans at the moment contemplate Ukraine. Ukraine is kind of an outside chance for the business. If things turn in Ukraine, all of a sudden discussion will be changed fairly fundamentally from our perspective because, you know, we would be looking at ourselves as a genuine kind of first mover to the Ukrainian market. We would definitely go to market as a hometown airline for Ukraine. Don’t forget that we were the largest non-Ukrainian airline in Ukraine prior to the war with the operating basis. We would be looking at reinstating that presence.

I mean, obviously that would be through a transitionary period, but, in terms of ambition, we would certainly go to Ukraine for market leadership. Thanks, Eric. All right. So, James Hollands from BNP Paribas. A couple of strategic ones, József. Maybe just run us through a bit more on the Western European strategy. You know, are we back to where we were when you listed 10 years ago? It’s all about CEE. You know, obviously Vienna was very specific on taxes. Or if it’s easier, maybe sort of quantify how you’re apportioning the 10-12% growth, how much is CEE, how much is Western Europe, which leads us on to Abu Dhabi, which obviously you’ve closed as a base. Are you still going to fly quite a bit into Abu Dhabi?

Was the demand actually there that you still see it as not a base, but somewhere you still want, so you still see enough demand? And then, Jan, I hate to be that person in the room, but maybe just help us on the other costs for the full year on sale and lease backs and compensation, which we should be thinking about to get us or get you to around where consensus currently is. Thank you. Okay. With regard to CEE versus Western Europe, I mean, if I look at the picture today, what changed over 10 years is that we added Italy and London to our Central East European footprint. It was more before. We had Vienna, we had Abu Dhabi. You all understand the changes with that regard. We are very upbeat on both London and Italy.

As a matter of fact, looking into market shares, next year, early next year, we’re going to be the second airline in Italy. That’s quite an achievement, given that we are a bit of a late comer to the market. Nevertheless, if I take those two segments, we are still talking about 70-75% of the business being in Central East Europe, 25-30% being in Western Europe. With regard to focus, there is no change on focus. Focus will remain on Central East Europe. You see that all these new base openings, adding aircraft on an ongoing basis to our key Central East European markets, will just continue to fuel that strategy. I don’t think that you should be expecting much of a change with that regard.

You may argue that, you know, we burnt our fingers in Abu Dhabi. You do not want to do it again. Now with regard to flying to Abu Dhabi or the UAE, I think we maintain few operations there. Where we think it makes commercial sense, from a perspective of profitability, we continue to operate to Abu Dhabi. We continue to operate Dubai. We continue to operate Jeddah. That is a U.K. operation. We operate Medina in Saudi. Where it makes commercial sense, where we can make real money, we would continue to operate. We are not planning on setting up bases, or AOCs, or anything like that. I think we will remain somewhat opportunistic with that regard. In terms of H2 others performance, I would expect you could expect that to increase.

If we were at $0.27 in unit cost benefit in this fiscal half, I would expect that to probably go up like, you know, 40%. There is quite a lot of deliveries happening in that period. Until we inform you otherwise in terms of our financing strategy, our approach is to take advantage of the sale lease back market. We think that is a very efficient way to translate the benefit of our purchase contract into shareholder return. There is no change there. That is simply part of how we approach this. Mike, good morning. It is Rory from Citi. Firstly, could you quantify the Abu Dhabi exit costs in the financial year? Secondly, it sounds like H2 RASK is perhaps resilient given the share of immature capacity and the capacity growth.

Would you be able to talk about that at all, how that’s performing across different markets or, on new routes versus existing routes? Thank you. I’ll take the first one. On the exit costs, like I said, we don’t expect there to be net a detriment in terms of exiting Abu Dhabi, both in terms of a P&L perspective, but also from a cash perspective, due to the arrangements that we’ve concluded with the joint venture partner down there. I can’t specify exactly what those costs are, or we’re not in a position to. That would be regard to H2, ROSC. I mean, we have been making a lot of new market investments in Central East Europe. I mean, it still takes time to mature. It’s a quicker and faster maturity curve than investing in Europe, let’s say.

It still has to mature. I think the ROSC challenge in the current half of the financial year is mainly down to the maturity of new routes. At the same time, you’re going to take the benefit of that in next financial year. Hi, it’s Andrew Barclays. Can I ask around the fleet? Well done on getting down to 11 XLRs. That’s the start. What do you do with Europe? They’re only in with the U.K., but I think you own with the U.K., don’t you? Can I ask a question? I know you’re not going to answer, but I’ll ask anyway. What’s going to be the financial impact of deferring the aircraft? What should we be thinking about the relation pricing?

How will that impact how we should be modeling the CapEx going forward? If I can be greedy and ask a third one, staying on fleet, you seem in a hurry to get rid of the CEOs, but whilst you gave us a lot to the NEOs, the current fuel price, the maintenance burden against the fuel price makes CEOs better aircraft than NEOs at this fuel price. When you get rid of the CEO, you take a big penalty on the lease return costs. Why did you not go for more aggressive deferrals of new deliveries and keep hold of the CEOs for longer? I will point out, Joe, that Andrew did ask me the second question this morning directly, which I refused to answer. Okay, so you put the burden on me. All right.

Okay. Let’s go through this because I think these are all very important questions. I mean, you probably, I take the second question, which is going to be unanswered probably, but I just want to give perspective to that. You probably appreciate that when negotiations drag for six to nine months, that is essentially one reason for that. This is commercial. And what does commercial mean for aircraft procurement? This is pricing escalation, nothing more really. I mean, that’s the essence of the whole thing. Given that drag, that long-term settlement on that, you should be expecting that it is very favorable to be there. I cannot tell you more than that, but it is very favorable to be there.

I’m not sure I would be too much into CapEx with that regard, just kind of take the linear line on what you are seeing at this point in time. That’s a good deal. With regard to the XLRs, I think 11 is not going to be the final number. 11 is what we are taking deliveries of, but for a portion of that, we would be looking at market solutions. We are not going to put 11 aircraft into Wizz Air UK. It’s going to be less than that, and we will see how we can kind of reconcile the gap with the market with that regard.

Please do not ask more questions on this because I am not going to be able to answer at this stage of the game because there are things happening in the background, but not yet at final closure. There is still some kind of flexibility when it comes to the XLR matters. CEO versus NEO, that is a good question, Andrew. I think the way to think about this, or at least this is the way I think about this, is that there is a distinct difference between the A320 CEO and the A321 CEO. If you take the A321 CEO versus the A321 NEO, given the current fuel price, you can argue that it is a wash. When you look at the economics of the two aircraft, it is pretty much a wash.

You have the fuel burn benefit on the NEO, but that’s offset by the higher capital cost and higher maintenance cost on the CEO. This is something which can change. I mean, if fuel price comes down significantly, then the CEO starts prevailing as an economic concept. If it goes back up again, then the NEO becomes a better aircraft. This is given the current maturity of the technology. The moment we get to advantage, we think the equation flips structurally. There is no more debate on fuel price and who is better, which aircraft is better, CEO or NEO. The NEO at that point will prevail. At the moment, you can argue that actually there is a way to compare the two. As we speak today, I would say that the economics of the two aircraft are pretty much the same.

Now, the A320 CEO is a different animal. The A320 CEO is 180 seats versus the 239 seats. No way that we could come to the economics of the, of the A321 NEO operation with an A320 CEO. If you take the deliveries of aircraft, I think the right strategy for us is to preserve A321 CEOs as much as it makes sense, but still continue to get rid of the A320 CEO. We have no appetite for extending A320 CEOs. I think we will continue to evaluate the A321 CEO versus the A321 NEO. I do not know if that kind of gives you the answer, but I would definitely make a distinct difference within the CEO line between the A321 and the A320. Thanks. Joel Koo from Panmure Liberum.

Could you talk a bit about how trading’s going in the U.K.? Obviously in base terms, you’re in losing that Gatwick. I think over the past six to twelve months, there’ve been some slots that have become available at those relatively slot-constrained airports. I don’t know whether it was an active decision on your part to not go for those slot opportunities or whether you lost out to new entrants. What’s your thoughts in terms of taking opportunities to put more aircraft in, you know, into the London market, for example? Yeah, good question. I think we have an increasingly nuanced view on how best to allocate capacity in London. First of all, we remain very upbeat on the London market. We are very supportive of the growth and development of Wizz Air U.K., and Wizz Air U.K. is an ever-improving platform.

Maybe we are seeing some very impressive financial improvements coming through the operation of the airline. We remain highly committed and very supportive to the London market. Having said all of that, I think we have to look at differences between Luton and Gatwick. The issues we are facing at Luton at the moment are capacity, constrained structurally by passenger numbers. I mean, that is a policy decision of the shareholders. Secondly, they have some short-term runway improvements that affect the short-term capacity we can put through the system in Luton. I would say that in Luton, we are very interested in pretty much sucking up everything that becomes available. Gatwick, I think we have been overly focused on slots, as opposed to performance, in the past.

We ended up operating also a slot portfolio that did not make much sense from a commercial perspective. The slot portfolio became a burden as opposed to an opportunity on the business. Now, certain parts of the slot portfolio are very favorable, not only operationally, but also commercially. We remain, you know, very committed to operate that portfolio. That is why we are rationalizing capacity allocation between the two airports. We focus on proper slots, you know, that translate into proper, proper commercial opportunities at Gatwick. We are pretty much sucking up everything at Luton, which becomes available. Hi there, it is Conrad Gaynor from Bloomberg Intelligence. I just want to touch on labor costs, Jan. You sort of alluded to the fact that maybe we should not expect more cost creep in some of those type of items.

You know, the way I’m reading that is basically as you increase your capacity, you start to, you know, GTF issue starts to soften. There’s some sort of productivity gain to be had that will offset things like wage inflation. Now, how do you, given that there’s so many moving parts, you know, you’re coming out of Abu Dhabi, putting capacity in different places, you’re still going to have high capacity growth. How do you actually manage that transition and dynamic? Yeah, I think when it comes to labor costs, I would think of two fundamental issues. I would think of nominal, nominal, inflationary pressure on pay, and I would think of productivity, how much productivity we are able to get out of the labor force that we have.

Now, if you look at the current situation, we are compromised on productivity. We are compromised because of the volatilities, the operational volatilities we are managing against the backdrop of the GTF groundings. I mean, simply, you cannot refine your model as such as we used to in the past that, you know, you really mathematically kind of figured out how to deliver the highest level of productivity against plannable, foreseeable external factors. You are broken on that, because we do not know how many engines we will have operationally available. You have to have a slack. You have to have a slack with that regard. Also, because you are losing engines and aircraft today, but you will recover tomorrow. You want to make sure that you actually have a crew. You have the pilot force. You have the cabin crew to operate that engine.

As a result of that, basically our productivity has been somewhat dented, versus where you would want to be ideally. Now, with more predictability, and more recovery of the GTF issues, you know, the better we can plan on productivity and, and the more we can improve on productivity. I think when it comes to labor costs, the improvements will come through productivity, not nominal inflationary resistance. Whatever the inflationary pressure is, whatever the market does, we have to do it. I mean, we do not have a choice. I mean, we pay according to market. If the market goes 3%, we go 3%. If the market goes 0%, we go 0%. If it is 10%, it is 10%. We do not have much choice on that.

but I think we have an opportunity to do better on productivity once we are putting more credibility and more predictability across the system when it comes to input issues like, you know, GTF and those sort of things. Cheers. We will now begin the Q&A session for participants online. If you wish to ask a question, please use the raise hand function at the bottom of your screen. The first question is from Jarrod Castle at UBS. Please unmute yourself and begin with your question. Great. Thanks very much. Good morning, everyone. Three from me. Just want to get an idea, József, Ian, how you see, you know, capacity growth in the markets you’re growing in over the next, you know, two to three years, if you exclude your capacity growth. So I guess, how do you see competition?

Secondly, I do not think you answered it outright, but you have obviously sold three planes outright. Sounds like you might try to sell some further 321 XLRs, but how many potentially could we see in terms of deliveries being recycled in outright sales? And then just lastly on your net debt to EBITDA, nice to see the ratio falling. When do you think we could get back to two times if you, you know, when you look at your kind of growth profile and budgeting? Thanks. All right, thank you.

With regard to the overall market growth and growth of competition, I think in Saint-Thomas, you know, the fundamental question is not, and I know that people like entertaining this tension in the market that, you know, to what extent do you think Wizz Air can grow in light of what the other guys are doing, et cetera. That is not the question. The question is, that, you know, you can assume reasonably that both of these carriers will continue to grow. The question is, what happens to the rest of the market? You see very clear trends. If you look at our market positions, as said now, we are moving from 25% to 29% market share. The other guys are at 20-21%. Basically, every second passenger flying in and out of Saint-Thomas is taking either us or the other guys, us more.

That number used to be like 30% a few years back. I can tell you this number is going to be probably 60-70% in a few years down the line. These two airlines will continue to take market shares in Central East Europe, you know, and you’re going to be seeing a lot of the incumbent, you know, national carriers or small scale private carriers diminish in the marketplace. I think this is what you should be expecting. Will the overall market grow in Central East Europe? Definitely. I mean, Central East Europe is a lot better place with that regard than Western Europe in terms of GDP, development, and, you know, standard of living is rising relatively higher in Central East Europe. It’s kind of an economy convergence and standard of living convergence are taking place.

You know, that will produce more discretionary spending in those markets. We are seeing that is going to be increasing market demand, and that is going to be diminishing kind of small-scale competition in the marketplace. I do not really care, you know, how much the other guy is growing because I think this is just going to affect more the rest of the marketplace. To be honest, that phenomenon has been the case over the last 10-15 years. That is nothing new here. You can go back to the history of Central East Europe, look at, you can look at market share evolution. I mean, this trend is not new. It has been happening and it has continued to unfold.

With regard to fleet, to what extent we would be pushing for more outright sales, I think I would consider this as a short-term phenomenon, not as a structural matter. We do not have plans to sell these aircraft. I mean, these aircraft are extremely well-priced aircraft, source of competitive advantage versus other airlines. You know, we need to put that aircraft into work and we need to make money on the aircraft by operating the aircraft, not by selling the aircraft. As said, short term, we are under capacity pressure. This is only a short-term phenomenon. Yeah, I mean, you spotted that the XLR might be a, might be a candidate, or some of the XLRs might be a candidate. Indeed, when we have news to spread, we will do that.

Please do not look at outright aircraft disposition as a strategy on a structural basis. This is only short term. Yeah, if I could just add to that, I mean, do not forget the inherent value of that order book and what it does for Wizz in terms of the company. That is something that we want to capture. We will capture and we have different ways to translate that. That is not something that we want to impact. That is still something that I think the market does not quite properly give us credit for. In terms of your question, Jared, in terms of net debt, I am not going to tell you when we are going to hit two times. All I can tell you is that is something that I am extremely focused on. I think it is extremely good discipline in the business.

You know, we want to build a business that we want to work for, other people want to work for, you want to invest in. And to do so, we know that we need to bring the balance sheet into a certain condition. We see a path to get there. The number one way to do so is to generate operating profits. That will generate EBITDA that’ll then help us offset the, or bring down the ratio. And that’s our focus. It’s a target. It’ll be something that we talk about at the capital markets day. It ties into our fleet plan, but ultimately profitability is what will drive that ratio. And that’s what we’re focused on. Thanks very much. The next question is from Stephen Furlong at Davy. Please unmute yourself and begin with your question.

Hi there. I was wondering, József, what, what’s the North Star here? Do you think that fiscal year 2028 is the more normalized year or is it fiscal year 2029? What would you see as the execution risks? I mean, is it suppliers? Would you describe your relationship with your suppliers, meaning Airbus and particularly Pratt & Whitney? Are they good now? I mean, obviously the challenge of Pratt & Whitney has just been huge for the company. Thank you. Look, I mean, it’s a good, it’s a good question. I still think that the single biggest risk is around the supply chain, probably more around the OEM side than the immediate airline execution. I think they are improving, but at the same time, I mean, you kind of look at a bigger picture.

You see that it is not only Pratt & Whitney customers that are out there with grounded aircraft, but CFM customers are also grounding aircraft. This is not like one guy is broken and everyone else is doing great. Everyone is broken, if you want to put it that way. You can debate the magnitude of that, how bad is this guy versus the other one. There are structural issues. I think there are structural issues with probably too quickly shortcutting technological developments. It was too much of a regulatory ease. I am pretty sure that the regulator will kind of toughen up with that regard. You can argue that, you know, the industrialization, production have not been properly executed, and that will continue to pose risks to the operators, et cetera.

I do not think that this is going to turn anytime quickly. I do not know how long this is going to take, but I personally, what I would expect is that with the introduction of the advantage and kind of the rollout of that at industrial scale, you know, probably we are still seeing a somewhat risky supply chain environment over the course of the next two to three years. You recall when we started grounding at that time, everyone believed that, you know, all this powdered metal issue is going to hit the industry for up to 18 months. Now this is more like a five-year cycle. Now this is all compounded with kind of the childhood diseases coming through the premature technology. This is going to take time. I think what it really means in the industry is that innovation will slow down.

The investment cycle for OEMs will lengthen, as a result of all these hiccups. I mean, just look at how much money Pratt & Whitney has to spend on this recovery. I mean, this is going to put burden on the recovery of the investment. It will just extend that investment cycle. I would say that long term, I’m confident that the supply chain is going to fix itself. OEMs will fix themselves. Short term, even I would say maybe medium term, there are some risks associated with the operation of the OEMs. Okay, thank you. The next question is from Alex Patterson at Peel Hunt. Please unmute yourself and begin with your question. Please unmute yourself and begin with your question. Sorry about that. Two questions from me, please.

Firstly, the GTF engine, what’s your confidence that maintenance costs will be what you think they will be? Have we actually had enough flying hours to establish, you know, how these behave after the inspections? You know, is there a risk that actually it turns out to be a bit worse? Just in terms of your RASK guidance for the second half, again, what’s your degree of confidence that you can deploy the 35 deliveries, obviously net of anything going back, and not, you know, because you’re concentrating the deployments into Central East Europe, Italy, and London. Is there a risk that actually you dilute it a bit worse, a bit more than you’re suggesting? Look, I mean, I will start with the second one first. You know, all these aircraft have been deployed.

They are up for sale. Some of them have started operating. Some of them will start operating during the period. I think we, of course, still have uncertainty around how exactly revenue is going to play out. I think we are fairly confident in what we are saying. We are not optimistic in terms of the numbers or the perspective that we are presenting to you. Is there a potential upside to that? Maybe. We want to be on the kind of conservative, realistic side of the equation. I do not think you should be expecting a huge variability to our assumptions at this point in time.

If I could just also add to that, Alex, the number is not 35 deliveries in the H2. That 35 is the year-on-year increase in number of NEOs at the end of Q4 this year versus Q4 last year. Just to make sure that you, it’s that we’re using the right data points. Yes. With regard to the GTF, the beauty, if there is such, in our case with regard to Pratt & Whitney is that we have a flight-out agreement. Effectively, we put the burden on Pratt & Whitney. Now, of course, if there is no engine, there is no engine. You have to share the burden. In terms of maintenance cost, the burden is on Pratt & Whitney.

That is a major difference between how CFM goes to market versus Pratt & Whitney goes to market. CFM does not stand behind the product. Basically, they say, look, we are 75% of the short-haul engine market. We have a very, very established market for purposes of engine maintenance. Use the market for our own benefit. Pratt & Whitney is underwriting the performance of the engine. Effectively, we have outsourced the risks, the economic risk on engine maintenance. Now, that sounds simple and this is not as simple as that, but in essence, that is what it is. If the maintenance costs on the engines turn out to be higher than expected or assumed, the burden is going to be on Pratt & Whitney, not on us.

Of course we still need to have the engine available to us to operate and fly. Thank you. The final question is from Gay Borbukta at Concorde. Please unmute yourself and begin with your question. Yeah, hi. Thank you for your presentation. You may have heard that there are some rumors on the market that LOT may buy SmartWings, which has a significant exposure in the Czech Republic. You may always see LOT as an inefficient company like TAROM in Romania. If such an acquisition were to happen, would you see any chance to increase your exposure in the Czech Republic? Or how would you look at this kind of transaction? I think it’s a bad idea, but that’s not my call.

Look, I mean, in my mind, LOT is an airline losing in on the home ground, and SmartWings have ever been losing in their homeland. So when you put those two together, I mean, what do you expect? I think the competitive environment in Poland is pretty, pretty tough for a national carrier. Maybe it’s a little more benign in the Czech Republic. Czech Republic, that can change, especially given these dynamics. Look, I mean, this is really not our business, but I think strategically probably both airlines will get weak on the result of this because you are putting weaknesses together, not strengths together. All right. I think we are done. Ladies and gentlemen, thanks, thanks for coming. Thank you for your question. Appreciate your interest. Thank you. Have a good day. Thank you.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.