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Flybe in the red after tough year

Flybe chief executive Jim French

Flybe chief executive Jim French

First published in Business

SOUTHAMPTON Airport’s largest carrier Flybe enjoyed a nine per cent share bounce this morning despite slumping to a full-year loss.

The regional airline racked up losses in the UK of £2.2 million for the year to the end of March, compared to profits of £5.7 million the previous year, as it battled a five per cent decline in the domestic market and high fuel prices.

But the carrier grew its share of its domestic market to 28 per cent after passenger numbers lifted two per cent to 7.3 million and analysts said it is set to benefit from recent falls in oil prices.

Shares in Flybe, which floated on the stock exchange 18 month ago, rose 5.5p to 67.5p.

Flybe Finland, the company's joint venture with Finnair started nearly a year ago, already operates 25 routes in six countries and has scope for further expansion amid consolidation in the industry.

Losses for the group were £7.1 million, compared to a £22.3 million profit in the previous year.

Chief executive Jim French said: ''We remain in a challenging environment. However, Flybe today is a business of real scale and substance and one which has again demonstrated its resilience.''

Andrew Fitchie, an analyst at Investec, said the company's drive to contain costs while investing in its fleet and expand overseas will ''pay off handsomely'' given time.

He revised up his forecasts, saying he expects the airline to return to profit in the current year, with a £500,000 surplus compared to his previous estimate of a £1.3 million loss.

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