PE’S biggest regional airline Flybe reported a higher first-half profit, but said it will cut the number of UK domestic flights this winter amid falling demand and high fuel costs.
The Exeter-based carrier, which has seen its shares slide since its flotation last year, slashed its full-year profit guidance last month after experiencing a slowdown in September sales.
Revenues from forward ticket sales for this winter are one per cent lower than a year ago, the group said in a statement yesterday.
The group, which operates 83 aircraft from 14 UK airport bases, said it would reduce the number of seats flown over the winter by six per cent compared to a year ago as it matches capacity with demand.
Chief executive Jim French said the group was taking “a very cautious view” going forward due to economic uncertainty and that its high frequency commuter routes meant it could cut flights without cutting routes.
“We are de-risking the business. The greatest sin in the aviation industry is too many aircraft and too much capacity – we are taking a neutral position.”
Revenues for the six months to October rose 6.4 per cent to £341.6m compared with last year, when flights were grounded due to the volcanic ash disruption, while pre-tax profits rose to £14.3m from £8.2m.
French said that while the group had taken a “conservative” position in the UK market, its sees “considerable opportunities for expansion in Europe where it is “looking on a selective basis.”
Flybe Finland, its new joint venture with Finnair, generated revenues of £8.6m in September 2011, its first month of trading, and is already flying across 26 routes.
Flybe rose 2.94 per cent to 70p last night. Its shares have fallen almost 80 per cent since floating on the London Stock Exchange in December last year.