Downturn to limit profit growth at Dart

Leeds-based Dart, which owns Jet2.com, said it continues to develop and grow its business base across its operations.

The group said pre-tax profits for the year to March 31 will be in line with current market expectations.

It added that cash flow generation from operations remains strong and it has continued to invest in further growth, particularly in its aircraft fleet.

Looking forward to the year ending March 2013, Dart said overall forward booking levels for Jet2.com, the group’s leisure airline, remain in line with its planned 10 per cent capacity growth for summer 2012.

Dart is continuing to see strong growth in Jet2holidays.

It said that business volumes are satisfactory at Fowler Welch-Coolchain, one of the UK’s leading logistics providers, although margins remain under pressure.

Analyst Peter Ashworth, at Charles Stanley, said: “We are forecasting pre-tax profits of £29.8m, which is at the top end of expectation with consensus forecasts around £28.0m.

“We continue to believe that Dart Group offers long-term value.

“However given margin pressure and higher fuel costs, we anticipate flat profits for the 2013 full year.”

Analyst Nick Batram at Peel Hunt said that Dart looks set deliver an impressive performance against a very challenging backdrop.

“This is a reflection of the quality of management and the strength of the business model. In addition, the group has a conservative balance sheet,” he said.

Richard Curr, head of dealing at Prime Markets, said uncertainty in the travel and leisure industry has weighed heavily on Dart shares over the winter of 2011 and, although boosted by director share buying in January, there has been nothing in the way of reassurance or guidance from the company up to this statement.

“Although margins remain under pressure at the group logistics arm, Prime Markets believes the reassurance on full-year guidance and that the group continues to invest into further growth will come as a relief to the markets and should see Dart shares recover the February highs at 81p plus in fairly short order,” he said.

The group’s shares closed up 0.7 per cent last night, a rise of 0.5p to 73p.