The firm said EasyJet Holidays will launch in the UK before Christmas and will offer beach and city holidays across Europe.

Earlier this month, Easyjet confirmed it had bought Thomas Cook’s airport slots at Gatwick and Bristol.

Chief executive, Johan Lundgren, said: “I am really thrilled that with the launch, before Christmas, of our brand new EasyJet Holidays business we are bringing flexibility and excellent value to the holiday market.

“We are now able to offer our customers more than 100 amazing beach and city holiday destinations, pairing Europe’s best short-haul flight network with more than 5,000 of Europe’s best hotels.  We believe there is a gap in the market for a modern, relevant and flexible business for today’s consumer.”

The announcement comes as the airline confirmed pre tax profits fell by 26 per cent to £427m in the year to 30 September, down from £578m the previous year.

However, revenue was up 8.3 per cent to £6,385m and passenger numbers increased by 8.6 per cent to 96.1 million.

The airline also announced plans to become “the world’s first major airline to operate net-zero carbon flights across our whole network”.

Lundgren said: “We are doing this by offsetting the carbon emissions from the fuel used for all of our flights.

“Our priority is to continue to work on reducing our carbon footprint in the short term, coupled with long-term work to support the development of new technology, including electric planes, to reinvent aviation for the long-term.”