Flybe integrates BA Connect, reports profits and is considering stock market listing
12.11.07
Privately-owned regional low-cost airline Flybe said today that it is on track to deliver £40m of savings from the former BA Connect business it took over this year. It also announced a £20m improvement in profits and plans for a stock market float
Flybe said it had successfully integrated BA Connect into its business after completing the acquisition from British Airways on March 5. The airline is on track to deliver the cost savings and ancillary revenue after completing a rationalisation of the its sites in Bristol and the Isle of Man, the closure of its Manchester head office and other restructuring measures including axing routes.
The Exeter-based airline also said full year pretax profits before exceptional items were £15.6m in the year to March 31 against losses of £4.4m year. Turnover increased by 16.6% to £355m and the airline carried 5 million passengers. It has sold all of the Embraer 145 regional jets it inherited from BA Connect at price levels within the funding provided by BA for that purpose. It has also made significant progress in selling a small number of BAE 146 aircraft in its fleet.
Chairman Jim French said Flybe would start looking at flotation late in 2008 or early in 2009, depending on the state of the global credit market and fuel prices at that time. He said: 'We'd look to the markets towards the latter stage of the [plane] substitution programme. My instinct is the programme will completed by mid 2009.'
As reported yesterday, rival Ryanair, Europe's biggest budget airline, has suffered a 15% share price fall this year despite impressive profit performance. There is every indication that the credit crunch will get worse before it gets better, with a global recession a real possibility. If there was ever a time to float an airline, 2008 or early 2009 is unlikely to be it.
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