Wizz Air Sees H1 Earnings Drop To $888 Million As Pratt & Whitney GTF Engine Issues Increase Operating Costs

Wizz Air, which has published its H1 FY2025 results on November 7, said that it would return to growing its operations gradually due to better visibility in managing the Pratt & Whitney PW1100G-related groundings and its Airbus delivery schedule next year.

Still, the Hungary-based low-cost carrier detailed that for the remainder of the fiscal year, it will focus on reducing costs to navigate the accelerated removals and inspections of the PW1100G engine, also known as the Geared Turbofan (GTF).

Resilient performance

Speaking about Wizz Air’s H1 FY2025 performance, József Váradi, the chief executive officer of the airline, said that during the first six months of the fiscal year, the carrier delivered a resilient performance, which was driven by solid demand and a strong focus on operational efficiency.

The CEO noted that during the period, it continued to manage its capacity while facing operational disruptions due to the grounding of its A320neo family aircraft. As a result, its passenger numbers increased only slightly to 33.3 million, compared to 33 million in H1 FY2024.

“This includes a record 6.2 million passengers during the month of August, reflecting the strong demand for routes across our network and the dedication of all our colleagues to maintain high standards and service levels.”

Ryanair, which published its H1 FY25 results on November 4, also highlighted that it carried a record-breaking 20.5 million passengers during a single month in August.

Nevertheless, Váradi said that Wizz Air’s revenue was relatively flat, improving 0.8% year-on-year (YoY) to €3.06 billion ($3.29 billion), with unit revenues growing 1.4% YoY to €4.98 cents ($5.4 cents).

“Our ancillary revenue streams, including priority boarding, bags and subscription product offering continue to make an important contribution to overall revenues.”

The CEO also pointed out that Wizz Air’s revolutionary ‘All you can fly’ annual membership service sold out within 48 hours, showcasing a strong demand for such products.

Controlling costs

Váradi reiterated that the airline focused on managing its costs during the period, with cost per available seat kilometer excluding fuel (ex-CASK) increasing 15% YoY to €3 cents ($3.2 cents).

The increase reflected the inefficiencies in the cost of aircraft groundings, network, crew, and expenses related to short-term wet leases to ensure capacity during the peak summer season, the CEO said.

“Cost control remained a key focus area during the first half, particularly with the management of the

Pratt & Whitney

related aircraft groundings and air traffic control disruptions.”

As a result, Wizz Air ended the six-month period with a net income of €315.2 million ($339.4 million), while its earnings before income, taxes, depreciation, and amortization (EBITDA) was €826 million ($889.6 million), a decrease of 21.3% and 5.9% YoY, respectively.

The airline had cash and cash equivalents of €460.3 million ($496.1 million) at the end of September, compared to €728.4 million ($785.3 million) as of March 31.

Managing the GTF disruption

Wizz Air’s chief executive continued the review of the airline’s half-year results by saying that bookings have not indicated a slowing demand for air travel, with the carrier expecting positive momentum in bookings and yields in H2 FY2025.

Wizz Air could still be affected by further escalations in the Middle East, with its operations at Tel Aviv Ben Gurion International Airport (TLV) being suspended until January 2025.

Váradi noted that during the second half of the fiscal period, PW1100G-related groundings will continue inflating costs that the airline hopes to counterbalance by improving fuel and operational efficiency as well as network optimization.

Since late October, Wizz Air has ended all short-term wet lease agreements, and it has started negotiating a new compensation agreement with Pratt & Whitney. In H1 FY2025, the airline received €146.3 million ($157.8 million) of credits related “to incentives and compensation from Original Equipment Manufacturers (OEMs) and other suppliers.”

“As we look ahead, we now have better visibility to manage the GTF issues to their expected conclusion in F27 and our timetable of deliveries from

Airbus

means we will gradually return to growth from next year.”

Váradi concluded that its A321neo fleet, underpinned by its order book and fleet renewal program, will provide Wizz Air with unparalleled advantages in the long term. Thus, ‘Wizz 500,’ the airline’s plan to grow to 500 aircraft in the next decade, remains its strategic objective as it expected fleet growth from 15% to 20% annually starting next year.

As of September 30, Wizz Air had 41 A320neo family aircraft grounded due to the GTF removals and inspections, which was an improvement over the original expectations due to “expedited induction of quick-turn engines.”

Wizz Air will have 40 to 45 aircraft on the ground over the next 18 months, ten to five fewer aircraft compared to previous assumptions.

The low-cost carrier ended H1 FY2025 with 224 aircraft, having taken delivery of 15 A321neos during the six months, resulting in 63% of its fleet being the A320neo aircraft family.