Flybe's share price surged 13 per cent in morning trading after the regional airline announced a spike in revenue for the three months to June, boosted by the introduction of Heathrow services.
At the time of writing, shares were up 11.27 per cent at 39.50p.
Read more: Flybe nosedives into the red but shares soar
The carrier reported a rise in revenue of 11.7 per cent to £174m based on a 3.5 per cent increase in capacity, with Flybe flying 7.1 per cent more passengers than the same period last year.
Flybe also announced a 7.9 per cent increase in passenger revenue per seat to £51.73.
The number of cancellations also halved year on year, though on time performance - assessed as arrivals within 15 minutes of schedule, dipped slightly from 82.4 per cent to 81 per cent. The airline said improving this would now be its next priority.
Flybe reaffirmed that it expects a provision for IT costs of around £6m in the first half of 2017/18 relating to cancellation penalties on existing IT contracts.
Why it's interesting
The airline said its first quarter revenue received a boost thanks to adding new routes including Heathrow, as well as the timing of Easter. Back in December, Flybe announced new regular flights from Aberdeen and Edinburgh to London Heathrow, which started in March and significantly boosted the firm's UK domestic route network.
Liberum analyst Gerald Khoo said that while the timing of Easter was helpful, "in contrast to the industry, Flybe's forward booking data is pointing to an acceleration in the revenue per seat improvement, rather than a reversal".
Khoo said this was a validation of the management's strategy of "focusing on capacity discipline", and the performance to date gives cause for confidence.
Flybe expects capacity growth as a whole for the first half to be around two per cent, but the airline is now planning for second-half capacity to reduce by around seven per cent, reflecting "a smaller fleet and winter scheduling plans".
What the company said
Christine Ourmieres-Widener, who was appointed Flybe's chief executive in December, said:
There remains a lot to be done, but we have the firm foundations needed to progress our plans for the business.
In the second half of 2017/18, given the planned capacity reductions, there will be an increased focus on efficiency to improve operational performance and manage unit costs.