LONDON (Alliance News) - Flybe Group PLC Thursday said it turned to a small profit in the second year of its three-year turnaround plan after reporting a significant rise in revenue as the airline opened up new routes.
The company, which claims to be the largest regional airline in Europe, turned to a GBP2.7 million profit in the financial year to the end of March from the GBP23.6 million loss that was booked in the previous year following a material rise in revenue to GBP623.8 million from GBP574.1 million.
Breaking that revenue down, passenger revenue amounted to GBP571.7 million from GBP528.6 million whilst contract flying revenue increased to GBP13.9 million from GBP11.6 million. Revenue from other activities also rose year-on-year to GBP38.2 million from GBP33.9 million.
Flybe's costs in the year were mixed, with some increasing whilst others fell, but the rise in revenue allowed the company to report an operating profit of GBP8.7 million compared to the GBP12.7 million loss last year.
Fuel costs dropped as a result of lower commodity prices whilst maintenance, aircraft rental charges and marketing costs also experienced falls in the year. On the flip side, staff, ground operation and depreciation costs, alongside airport charges, all rose year-on-year.
Flybe said the current financial year will be the third and final one of its three-year turnaround plan - but said it has already resolved the company's "key legacy issues" after reducing the amount of liabilities by GBP750.0 million, it said.
"We delivered top-line growth in a difficult revenue environment, expanding our network and carrying more passengers than last year. We drove our unit costs down further. We also resolved our last key legacy issue, with solutions delivered for our remaining E195 jets," said Chief Executive Saad Hammad.
"As we enter the final year of our turnaround, we have set down strong foundations for the future and made good progress in transforming Flybe into a sustainable, world-class regional European airline," he added.
On the operational front, Flybe said passenger numbers were up 5.9% year-on-year whilst revenue per seat experienced a small drop. Seat capacity grew by 9.7% and yields by 1.7%.
Flybe opened up two new bases in the UK during the year and launched 52 new routes. Like-for-like routes also performed well as revenue per seat rose 3.0%. Flybe also improved its punctuality by 0.9% in the year and utilisation and the reliability of its fleet also experienced small improvements.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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