Flybe maintains winter carryings and raises summer capacity

Flybe maintains winter carryings and raises summer capacity

Flybe was able to maintain passenger numbers in the three months to March despite the impact of the November terrorist attacks in Paris.

In a trading update today, the regional airline said results for the full year to March are anticipated to be in line with market expectations.

Seat capacity in the carrier’s fourth quarter was increased at a temporarily lower rate of 2.4% in response to the Paris atrocities.

Carryings of 1.8 million passengers matched the same winter period a year earlier although the load factor fell by two percentage points to 68%. Passenger revenue was in line with the previous year.

Capacity for this summer has been raised by 17% with 21% already sold, three percentage points behind last year. This reflects increased frequencies on 24 routes and the introduction of 39 new routes.

Flybe has now hedged both fuel oil and US dollar to 90% of 2016/17’s exposure “in view of ongoing macro-economic uncertainty”.

The rise in the value of the dollar since the turn of the year has impacted 2016/17’s operating costs by £7 million.

The airline also disclosed that it had taken ownership of three Q400 aircraft, previously on operating leases, at a cost of $34 million.

“This is in line with Flybe’s strategy of rebalancing its aircraft fleet away from reliance on operating leases and towards outright ownership which brings the associated margin uplift<” the airline said.

Flybe’s cash position “remains strong” with a total of £171.3 million at the end of March.

Chief executive, Saad Hammad, said: “This last year has seen enormous progress at Flybe. We completed the resolution of the key legacy issues while significantly improving our service and customer offering.

“We are carrying more passengers across a growing route network and doing so at a lower unit cost.

“Against the background of the highest level of market capacity growth for six years driven by low fuel prices, we continue to be disciplined in deploying our capacity, focusing investment on routes where airport partners provide cost mitigation and those which adhere strictly to our business model.

“We are also continuing to reduce unit cost, which provides margin resilience, as well as reviewing our capacity growth rate beyond this summer.”

He added: “Our booking profile for the summer reflects our capacity investments and our growing appeal to business travellers who typically book as close as possible to their day of travel.

“We look forward to making further progress over the coming year as we enter the next chapter of our journey which is focused on disciplined and profitable growth.”

Full year results for 2015-16 are due to be published on June 9.


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