EasyJet has reinstated its dividend for the first time since the COVID crisis, while revealing a return to annual profitability.

The no-frills carrier said profit before tax over the 12 months to 30 September came in at £455m – a £633m improvement on the previous year and the first positive figure since the public health emergency struck in 2020.

It credited record profitability over the second half of its financial year, which covered the summer peak, as passenger numbers surged to help offset a hit from higher fuel bills.

The company announced a final dividend of 4.5p per share – equivalent to a £34m payout – and remained upbeat for the current year, despite an admission that the Israel-Hamas war would continue to prove a drag on earnings.

A total of 4% of its flying programme is currently affected because easyJet is not operating flights to Israel and Jordan.

Egypt services are also being affected.

The company said the shareholder reward for 2023, equivalent to 10% of after-tax profits, was expected to rise to 20% in 2024 despite the disruption and continued pressure on household budgets from the cost of living crisis.

The credited booking strength for summer 2024, coupled with supply constraints in Europe, provided a positive outlook for its next year as a whole.

Chief executive Johan Lundgren told investors: “Recent consumer research highlights that around three quarters of Britons plan to spend more on their holidays versus last year, with travel continuing to be the top priority for household discretionary spending.”

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