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Dart Group flies higher as it says profit will exceed expectations
Shares in Dart Group flew higher on Monday after the Jet2holidays parent said underlying pre-tax profit for the year to the end of March 2018 is expected to be "materially ahead" of current market views as prices return to normal following heavy discounting over the past year.
Dart said that looking ahead to the year ending 31 March 2019, forward bookings in its leisure travel business for summer 2018 are presently "satisfactory". In addition, the company remains "encouraged" by the performance of its two new operating bases at London Stansted and Birmingham airports.
Meanwhile, Dart's distribution and logistics business, Fowler Welch, continues to focus on growing its revenue pipeline and developing existing and new business opportunities.
"It is still early in the leisure travel booking cycle and we remain cautious on pricing. However, given the satisfactory forward bookings and the execution of our growth strategy, the board currently expects the group's trading performance for the year ending 31 March 2019 to be broadly in line with the current financial year."
Neil Wilson, senior market analyst at ETX Capital, said: "The failure of rivals - Monarch in particular - has been a real boost. As spare capacity has been removed from the short-haul air and holiday sector, Dart is able to benefit. The loss of Monarch, Air Berlin and Alitalia has undoubtedly helped. In particular Jet2 has been piling into areas previously served by Monarch, significantly increasing capacity at Birmingham, Leeds and Manchester to capture market share in both flights and package holidays.
"The upgrade is the second in just a few months after the firm said in November that higher demand for flights resulted in future bookings being ahead of expectations and that this would mean underlying profits would be materially ahead of market expectations."
At 1000 GMT, the shares were up 14% to 739p.