Flybe soared into the black in the last financial year for the first time since listing on the stock exchange five years ago on the back of cheaper fuel and more bums on seats. But investors were not too impressed, as shares dropped two per cent in early trading.
Profit before tax at the Exter-based regional airline came in at £5.5m in 2015/16 after adjusting for dollar-denominated loans, up from a £25.4m loss over the previous 12 months.
Revenues also took off, climbing by 8.7 per cent to £623.8m as Flybe airplanes carried 5.9 per cent more passengers.
The number of available seats, however, grew faster than people willing to fill them, pushing the load factor down by 2.6 percentage points to 72.6 per cent.
Why it's interesting
Strong results from the airline industry are perhaps not surprising given how cheap their most significant input cost - fuel - currently is. Flybe's return to the black, however, was built on more than just the low price of the black stuff, as it added routes, cut non-fuel costs and carried more passengers.
With share's trading at around one-fifth of the price Flybe listed for back in 2010, however, years of losses have taken their toll on the airline.
The company is currently on a big transformation which involves a plan to stop leasing and start owning its aircraft. Today's results will be taken as a small vindication of that strategy.
Read more: Airlines threaten to quit City Airport
However, a bigger capital base also exposures the firm to more risks, and although a regional low-cost carrier, Flybe is not immune from the wider forces at play in the industry.
It pointed to the ongoing threat of terrorism, industrial action in France, fierce competition, a rapid expansion in capacity in Europe's short haul market and uncertainty surrounding the EU referendum as just a few of the challenges it could face in the next few months.
What Flybe said
Chief executive Saad Hammad, who joined Flybe from EasyJet in 2013 said:
"We achieved profitability for the first time as a public company, following losses in every year since Flybe's stock market flotation in 2010. 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.
"As a result of all the action we have taken, Flybe is now a much more resilient business and well positioned for profitable growth.
"We are pleased with this performance and confident that we are well placed to navigate the current industry challenges with the strongest balance sheet in our history and a disciplined organisation which is already taking cost and capacity actions to support profit growth in the coming year.
What analysts said
Analysts Liberum said Flybe's results were "marginally ahead of forecasts", but Connor Campbell, senior market analyst at SpreadEx said "investors [are] insufficiently impressed with the company’s £5.5m in pre-tax profit."
Liberum, however, maintained its "buy" rating and target price of more than £1 a share, as Flybe traded at 57p this morning. It noted: "As well as cheaper fuel, there was notable progress on non-fuel costs. Trading conditions remain tough, with headwinds from fragile demand and faster capacity growth across the industry.
"[Flybe's] capacity growth is being moderated and another deal to buy in leased aircraft should see progress on reducing aircraft ownership costs. Risks remain, but we see these as more than adequately reflected in the current valuation."
A good set of results hasn't impressed investors by an airline that's had a hard time since going public. Plenty more to do before the champagne can be popped.