City snobbery the reason for Jet2's shares crashing

Why did the Square Mile not understand the figures, asks Chris Blackhurst - could it be down to old-fashioned elitism?

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On a recent holiday in Turkey, at Dalaman airport, Jet2 was much in evidence.

Its aircraft were on the tarmac, next to those of the major carriers, its check-in desks were lined up alongside those of the big players. Judging by the lines of returning holidaymakers, Britain’s biggest travel operator was doing healthy business.

Try telling that to the City. While we were on the concourse, traders in London were marking down Jet2 shares. They fell 24 per cent at one stage, wiping £600m off the company’s worth. This was because the company warned profits would come in at the lower end of analysts’ forecasts.

They were predicting a profit consensus range of £449m to £496m. The Leeds-based firm was saying the bottom figure was more realistic. Do the math: let’s call it £500m tops, dropping to £450m, so a 10 per cent fall. Since when has 10 per cent been 24 per cent?

Likewise, Jet2 said customers were cutting back on holidays and as a result, it would be trimming its winter seating capacity from 5.8 million seats to 5.6 million. That’s not 24 per cent either, not anywhere close. Barely a dent, too, on an overall total last year of 19.8 million passengers, of which 6.6 million were on its package holidays.