Flybe shares are in a nosedive after it warns on profits due to "disappointing" rise in maintenance costs

 
Courtney Goldsmith
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Flybe warned profits would be lower than expected (Source: Getty)

Flybe was the latest airline to hit some turbulence as it warned its profits will be lower than expected following a rise in aircraft maintenance costs.

Shares in the firm were in a nosedive this morning, falling as much as 20 per cent following the announcement, which was the firm's second profit warning this year.

Adjusted pre-tax profit is now expected to be in the range of £5m to £10m for the first half of the financial year, compared with £15.9m in the same period last year.

Chief executive Christine Ourmieres-Widener, said:

While half-year profits are lower than expected, I am confident that we are still on a clear sustainable path to profitability in line with our stated plan.

The increased maintenance costs are disappointing, but we are already addressing these in the second half and remain focused on improving our cost base and reliability performance.

Read more: Flybe shares soar as revenue rises on introduction of Heathrow services

A full review of the firm's maintenance strategy has now been launched with aims at a "significant improvement of aircraft performance and costs", particularly the Bombardier Q400 turboprop.

Ourmieres-Widener added that the firm's sustainable business improvement plan was delivering benefits, with yield and load factors increasing.

Increasing competition in the sector - which has seen Monarch, Air Berlin and Alitalia go into administration - has put pressure on prices.

Flybe is set to provide more information at its interim results on 9 November.

Read more: Ready for lift-off: Flybe begins its tie-up with Eastern Airways

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