Flybe to Add Flights After Returning to Profit in First Halfby
Sales rise 10% to 339.6 million pounds on growth in U.K.
Flybe to increase seat capacity 13% in third quarter, CEO says
Flybe Group Plc is adding flights on key business routes and looking to expand its network outside the U.K. after spending cuts helped Europe’s largest regional airline return to profit in the fiscal first half.
Pretax profit for the six months ended Sept. 30 was 22.9 million pounds ($32.3 million) compared with a loss of 3.3 million pounds a year earlier, the Exeter, England-based carrier said Wednesday in a statement. Sales rose 10 percent to 339.6 million pounds as U.K. business increased, while operating costs per seat declined 8.9 percent.
Chief Executive Officer Saad Hammad, a former EasyJet Plc executive, has scrapped unprofitable routes, cut jobs and closed some airport bases to restore earnings. Capacity will grow 13 percent in the third quarter, with Flybe adding seats in a “very disciplined way” on existing routes serving such destinations as Edinburgh, Paris and Dusseldorf, Germany, the executive said in an interview.
“We continue to scale up in terms of our route network,” Hammad said. Building on its British base, the carrier aims to "start driving that density on U.K.-to-Europe routes," he said. “That’s the next phase of development, and ultimately we want to scale on a pan-European basis.”
About 70 percent of Flybe’s flights are U.K. domestic services, with the remaining 30 percent linking British and mainland European airports. The company is targeting a 50-50 split, Hammad said.
The carrier is also interested in developing more so-called white-tail services, similar to a contract struck last year to fly on behalf of Stockholm-based SAS AB, Hammad said. Such arrangements, under which the contractor uses the client carrier’s branding on its planes, may become more popular as network airlines look for ways to cull unprofitable short-haul routes without losing customers.
“The big airlines are finding it difficult to operate thin routes properly,” as “they’re either withdrawing, moving to bigger aircraft, code-sharing or ultimately not serving these communities,” Hammad said. “We’ve got smaller aircraft and the right cost base, and the right knowledge and capability,” to offer the services at a profit.