Shares in Flybe plummeted over 12 per cent in early trading this morning after the company revealed a slew of bad headlines.
Providing guidance on its annual figures, the Exeter-based airline said "weak demand" had been coupled with "uncertain consumer environment". In addition there was "overcapacity amongst airlines and sharpened price activity from rail operators".
Furthermore, Flybe said revenue had also been hit by cancellations as a result of inclement weather and blamed French air traffic controllers for going on strike.
Read more: New Flybe boss reveals her excitement
After digesting the news, investors relaxed a little with shares regaining some ground. Shares are currently trading nearly six per cent lower than yesterday's closing price.
But Begbies Traynor partner Julie Palmer said it was "little surprise that cautious investors have reacted so strongly".
Seat capacity growth slowed by 10 per cent in the final quarter of the year after a 12.7 per cent drop in the three months beforehand.
Nevertheless, there was some good news as passenger yields rose 2.9 per cent in the final quarter leading to revenues increasing 9.8 per cent.
Flybe boss Christine Ourmieres-Widener said she was determined to "stop unprofitable flying". To do this, the airline said it will undertake a major upgrade of its core systems to improve its customer experience and allow better online sales.
Unfortunately, this meant a further £5m-£10m of losses, on top of the "small loss" it expects to report for the year to 31 March.
Nevertheless, the chief executive put a brave face on things:
I continue to be very excited about the opportunities in Flybe, especially as we are now able for the first time to take control of our fleet size to reduce overcapacity.
Flybe is increasingly a digitally enabled business, with 80 per cent of bookings already being made via our website. To seize this opportunity, we must first rebuild some of our core systems and this is now starting.
Meanwhile Palmer added: "With rising business and consumer uncertainty, a weaker pound and increased pricing pressure from rail operators all impacting the air travel market, not to mention industry-wide overcapacity causing revenues per seat to fall, the budget airline is clearly in for some serious turbulence ahead."