Jet2 Share Discussion Threads

[trying2trade] 25/3/2024 09:23

Whatever it is, it will be on reduced margins then previously hoped due to the delays on the airbus and this having to take on the Turkish aircraft. Still, jet2 shown they had it together early as one other package holiday operator is leading ryanair in to fill the gaps...

[castleford tiger] 25/3/2024 08:47

Capacity increase this year.
What is the TRUE figure

[havinthelasttoast] 23/3/2024 14:41

Investors chronical article from nov. Confirms net cash.


Jet2 reports surge in profits
Profit grows by a third despite disruptions

November 23, 2023
by Michael Fahy


Net cash pile increases by 46 per cent to £1.82bn
Bookings slow but full-year guidance unchanged

Jet2 (JET2) is flying a lot more planes than it did prior to the pandemic but, for now at least, is comfortably managing to fill them at higher fare levels.

JET2:LSE
Jet2 PLC
1mth
Today change
-0.07% Price (GBP)
1,423.00
The company increased seat capacity by 7 per cent on last year to 11.97mn and said ticket yields for flight-only passengers rose by 18 per cent to over £124. It also increased the price of its holidays, and the proportion of passengers who fly with the company on a higher-margin package deal increased by 4.9 percentage points to 70.8 per cent.

As a result, profit before tax and currency movements increased by a third to £665mn even though floods and wildfires in Greece and air traffic disruption in the UK caused profitability to weaken by around £14mn. Cash flow also increased, meaning net cash (excluding leases) grew by 46 per cent to £1.82bn.

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The reaction from investors was muted, though. An admission that bookings for winter “have been a little slower in recent weeks” triggered concern about the sustainability of demand, especially given that capacity will be 21 per cent higher than last year. The company maintained full-year guidance of pre-tax profit before currency movements of between £480mn and £520mn, though, and said early-stage bookings for next summer were “encouraging”, with load factors higher despite a 12 per cent capacity increase.

Although holidays are a discretionary spend, Peel Hunt analyst Alexander Paterson argued in a recent note that it's one for which customers are willing to make sacrifices. We concur, and remain of the opinion that with Jet2’s shares trading at 6.5 times the FactSet broker consensus forecast, they will appeal to the bargain-hunter as much as its holidays. Buy.

[havinthelasttoast] 22/3/2024 22:58

Would love you to give a customer deposit break down as you see it. Or cash balances explained as you see it. I am struggling to understand what exactly you are saying. My reading of accounts shows that only 200m is customer deposits and they describe “own cash” as after customer deposits. I can’t work out if what you are saying you mean to be positive or negative lol

As promised here is jet2 holidays site and the android app.




Personally I am seeing a trend with apps flatlining now. I think there was a big push and every website had their own app. I own medium size online businesses in the U.K. and we found it’s just a marketing channel with push notifications but customers are sick of app notifications rightly so. I personally use EasyJet and jet2 app but never to pay for bookings. I just use the browser.

It takes a lot now for me to download an app as I am sickened by them. That said engagement seems steady and holidays site is in good growth and especially when we take into consideration the large increase in basket value.

I’d recommend Sainsbury’s to you for research. Trend on app I sustained large growth and website is trending consistently high. They are the fastest growing supermarket and underlying profit will come through shortly. The market cap is tiny compared to the opp. Kandar and Nielsen backs up my research. The sell off in Jan was after a 25 percent rise ahead of results as the traders all get weekly till data and no upgrade was made. With share buy back of 200m in this year and the data I am seeing I expect a large rerate from here. I’ve entered for 400k at the same time as here at 2.46

[pemcap] 22/3/2024 22:02

Im acutely aware how much FCF comes with rev growth (& therefore customer deposit growth).


The sellside isnt. They have revenue growing, but their FCF from growing working capital deficit is zeroed out!

[havinthelasttoast] 22/3/2024 13:57

Did you see how cash generative they are since 2020.

This suggests an extremely resilient model. They are leagues above gypsy jet and Ryanair and now are my preference as I live in Portugal. Only issue is they are seasonal.

However the trend is not unique to jet2. We had a post Covid boom and then last years was slow compared to post Covid so airlines took a dive. People are travelling again this year and the comparable are softer.

I only have Android app data. But android is a percentage of the market. Google says 47 percent. It’s all not important it’s the engagement trend you are looking for.

[pemcap] 22/3/2024 13:50

Thank you!

Would be interesting to see app data (installs/activity level), on top of growth it also shows increasing loyalty.

In insurance industry, Buffett acolytes value the customer float (growth). This airline is seasonal, and growth is more bumpy related to cycle.
But still, I think if we do not credit any future cash growth value (capitalized interest on deposits) from secular growth, we can at least calculate an enterprise value that views 50% of the seasonally low customer deposits of H1 end (1.1B) as "own cash". This means 1.85 - 0.55 = 1.3B net "own" cash. I view this as a conservative measure (gives 0 credit for future growth, takes only 50% of seasonal low of customer deposits).

This framwork is OK unless we have regular new CV19 - like episodes.

[havinthelasttoast] 22/3/2024 13:07

I feel bad for John.

Been a member here for 20 years and can’t read a set of accounts hehe.

John are you a founder member of the 76 percent club? We all need you , in a zero sum game someone got to take the pain. We salute you John x

[havinthelasttoast] 22/3/2024 12:14

Let’s get this up to 15 quid

[havinthelasttoast] 22/3/2024 12:11

Happy to share it later if you wish.

[havinthelasttoast] 22/3/2024 12:08

Yes it is , I have it also. It’s around 200 percent of jet2

It’s similar but not as strong a growth. March may be slightly under but you have to balance the growth of traffic to old updates to gauge how much revenue growth will be inflation etc. Also they have app which has growth also.

All in all Jan and feb was exceptionally strong across all channels and March was slightly less but I expect the quarter to lead to very strong forward bookings.

I’ll be keeping a close eye but given the strength of the underlying business this is extremely undervalued

[pemcap] 22/3/2024 11:48

Thanks havinthelasttoast

I believe jet2holidays is more relevant and much bigger url to keep an eye on.

Re cash: Indeed, the gross net cash is just net debt (cash minus debt) while the net own cash deducts the unearned revenue on the balance sheet of 1.1B as of H1 24

[diviincomesearch] 22/3/2024 09:55

@havin it’s clearly net cash as you say.

I wouldn’t waste your time, might as well debating whether the earth’s flat or not.

Share price really is a bargain atm despite the 40% rally in autumn. That’s why we’ve had a bit of consolidation. Hopefully further updates allow us to push on

[bigbigdave] 22/3/2024 09:25

Anyway trying to breakout this morning

[havinthelasttoast] 22/3/2024 08:42

Hey John.

Here is a screenshot image of the free cash flow and net cash for the last years. Happy to hear how I have it wrong. Perhaps there is a difference between official accounting terms and how the company likes to present its cash. If any accountants out there can anyone explain the possible difference between how the company reports net cash of 2b and maybe officially it is less?

[havinthelasttoast] 22/3/2024 08:37

John I don’t think your source is accurate.

I take it from official channels not sharkscope.

But if you wish to point out where wrong go for it.

[havinthelasttoast] 22/3/2024 08:34

Here is a graph showing year on year comparison, blue line is this year. You can see the trend went strong when price was circa 1100/1000. The jet2 holiday site has more traffic and has similar trend.



I normally don’t like buying shares after a 40 percent rise but the financials are so strong and growth so strong I concluded value today should be over 2000.

[havinthelasttoast] 22/3/2024 08:31

It costs me 30k a year and i have full year on year web data and app data.

Quote often a decline in traffic proceeds a share price decline because traffic means footfall. EasyJet/ryanair and jet 2 have all shown growth but jet2 had strong growth in Jan and feb. March looks similar
To last year but with prices higher I’m expecting strong revenue growth year on year and strong forward bookings.

[johnrxx99] 22/3/2024 08:31

Sharescope. Net cash minus debt equals net debt. I have net cash in my bank account but the mortgage is 450k. But you believe what you want.

[evianone] 22/3/2024 08:30

I wonder who was buying yesterday with such high volume, we may get an RNS over the next few days,

[pemcap] 22/3/2024 08:26

Thanks for your posts.

Havinthelasttoast
What are good alternative data sources for web traffic?
Thank you!

[havinthelasttoast] 22/3/2024 08:20

It’s very specific.

Net cash and cash flow statement.

Net cash/debt
+450 in 2020
+1250m in H1 2023
+1860m in h1 2024

Reckon John when he reads the accounts is going all in. He thought net debt of 400m lol.

They have 3.2b of cash
Circa 750 of debt
Lease liabilities circa 650
Net cash of 1.8b

[havinthelasttoast] 22/3/2024 08:10

I also double checked the 2023 accounts and at that point they had gross cash of 2.6b and “cash net of borrowings of 1.2”

Where did you get your numbers from. I took it from interim results and 2023 presentation.

My read is the business is generating so much FCF.

Look forward to you showing me where you get no net cash from. Thanks

Here you go.