Flybe comes in a little lower during challenging times

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AIRLINE Flybe reported a slight fall in UK revenues yesterday amid challenging trading conditions.

Europe’s biggest regional airline, which flies from Doncaster, Bristol, Cardiff, Edinburgh and East Midlands, said UK sales fell 0.3 per cent to £133.7m in the final three months of 2011.

The figure confirms last month’s warning that revenues would be significantly lower than it hoped, fuelling fears in the City that the group could report a full-year loss.

Flybe has reduced capacity by six per cent and said it has seen passenger revenues per seat improve by three per cent as a result of the cut.

Chairman and chief executive Jim French said: “Although we expect market conditions to remain challenging, we have a robust and flexible business model and clear and achievable growth plans.

“We remain confident about Flybe’s long term future.”

Investec analyst Andrew Fitchie is forecasting that Flybe will make a loss of £8.5m in the year to March 31, compared with pre-Christmas predictions of a profit of £6.4m.

He anticipates further losses of £1.3m the following year.

In the UK the group sold 2.75 millions seats on its flights, a fall of 0.3 per cent. Once adjustments are made for the severe weather disruption before Christmas 2010, the year on year decrease was six per cent.

UK passenger numbers and load factor were comparable to the same period in 2010 at 1.7 million and 61.7 per cent respectively, despite what it called a “challenging” domestic market.

In the UK passenger revenues per seat rose 0.2 per cent to £47.41.

Flybe UK reported that 84.8 per cent of its flights were on time in the last three months of 2011, up from 77.9 per cent in the last three months of 2010 when the UK was affected by severe weather conditions from late November to the end of December.

In group terms total revenues increased by 18.6 per cent to £165.5m, driven by Flybe’s entry into Continental Europe through Flybe Finland, its joint venture with Finnair.

The group had net assets of £102.8m and total cash of £61.5m at the end of 2011.

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