EasyJet (EZJ.L) slid to a £1.27bn ($1.68bn) loss in the year to October, marking the first annual losses in the company’s history.
It had made a £430m profit a year earlier, but passenger numbers halved in the wake of the pandemic. Its board confirmed no dividend would be paid in light of the company's losses.
EasyJet’s final results published on Tuesday show its total revenues slid by 52.9% to just over £3bn. It launched the largest cost-cutting programme in its history, including cutting staff numbers by up to 30%.
But the company said underlying demand was strong, highlighting a 900% increase in sales in the days after the UK’s quarantine policy for travellers was lifted for the Canary Islands in October.
“We responded with agility adding 180,000 seats within 24 hours to harness the demand. And last week we saw the welcome news about a possible imminent vaccine roll out,” said chief executive Johan Lundgren.
He also told the BBC that Pfizer’s vaccine breakthrough last week had boosted bookings by “close to 50%.”
Lundgren added in the company’s statement on its results: "I am immensely proud of the performance of the easyJet team in facing the challenges of 2020.
“We responded robustly and decisively, minimising losses, reducing cash burn and launching the largest Cost Out and restructuring programme in our history - all while raising more than £3.1 billion in liquidity to date.”
EasyJet stocks moved slightly to the upside in the opening hours of trading on Monday on the London Stock Exchange:
Dan Thomas, senior analyst at researchers Third Bridge, warned however that "potential vaccines don't change the near-term demand picture for carriers like EasyJet.”
"For the time being, this winter looks bleak for EasyJet as national lockdowns persist across the continent.
"When travel corridors do begin to reopen, profitability is likely to remain depressed as multiple carriers look to redeploy across a smaller number of potential routes and discount fares are offered."
EasyJet only expects to fly a maximum of 20% of its planned capacity in the first quarter of 2021, assuming current travel restrictions in countries it flies to remain in place.
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The company declined to offer substantial financial guidance for its next financial year to 30 September 2021, "given the continued level of short-term uncertainty."
Thomas noted: "EasyJet continues to use the sale and leaseback of unencumbered aircraft as a source of liquidity.”
The airline announced the sale and leaseback of nine of its planes last month, raising $398.6m (£305.7m) in cash to help it survive the coronavirus crisis.