Regional airline Flybe reports strong start to new year
- Credit: Theo Moye
Regional airline Flybe said today it was cheered by improved summer demand despite a failure to make a profit in its most recent financial year.
The carrier, which flies 67 planes to 199 routes across 14 countries, warned in January that it would only break even in the year to March 31, compared with earlier City forecasts for a profit of about £9million.
Flybe today reiterated that break-even target today but also said it had been encouraged by recent trading after a 9% rise in UK passenger revenues compared with a year earlier.
It has increased capacity by 13% with the launch of new routes for this summer, including nine from a new base in Bournemouth and three domestic routes from London Stansted.
Shares rose by more than 2% today as the company said that 31% of capacity has already been sold for this summer.
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The airline is one year into a three-year turnaround plan that has seen it cut over 1,000 jobs and unprofitable routes after seeing passenger numbers fall in the wake of the financial crisis.
Last June the carrier posted a £8.1m pre-tax profit, its first in four years. But this swung back to a £15.6m half-year loss by November due to one-off costs and a charge related to the exit from its loss-making joint venture, Flybe Finland. It also has contracts on a number of unwanted jets it wants to exit.
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The airline said it had recently launched six new routes from London City airport with the biggest of them reaching load factors of 70% just five months after they had been introduced.
It added that it had also signed a six-year commercial agreement to fly planes for SAS, Scandinavia’s largest carrier.
Flybe chief executive Saad Hammad said: “These results demonstrate that we are beginning to deliver on the company’s growth opportunities and that we’ve tackled the majority of the company’s legacy issues.”
He added: “There is clearly more to do; further improvements in efficiency, further cost reductions and the resolution of our remaining surplus aircraft.”
The airline also recently launched a “hop-on, hop-off” service in October linking Aberdeen, Leeds Bradford, Southampton and Jersey.
Flybe-liveried planes have been flying from Stansted since March last year when services to and from Dundee were launched by franchise partner Lognair.
However, Flybe is now introducing three more routes from Stansted which it will operate directly, to the Isle of Man, Newcastle and Newquay.