August 2 2014 Latest news:
Monday, February 3, 2014
Regional airline Flybe expects fewer job losses than previously announced as its turnaround plan to rid itself of unprofitable routes and surplus aircraft gains momentum.
The Exeter-based group is reducing the number of positions facing the axe by 10pc to around 450, with roughly 40-60 compulsory redundancies.
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The fall comes after Flybe set out major expansion plans for Birmingham on Friday with seven new routes, including Florence, Cologne and Porto, making the airport its biggest base with 12 aircraft in total. It will also see Flybe become Birmingham Airport’s largest carrier.
Flybe’s refocus towards the larger sites in its network has seen it close bases in Inverness, Aberdeen, Isle of Man, Newcastle, Jersey and Guernsey, although it will continue to fly to those airports.
Its base in Exeter is still expected to be the hardest hit for job losses with around 100 posts set to go.
Flybe has already discontinued 30 unprofitable routes for this summer as part of its restructuring drive. By the end of the season it will also have grounded 14 aircraft.
Chief executive Saad Hammad said the airline was now on track to deliver £40 million of annual cost savings by the end of March.
He said: “Taking decisive action gives us a strong platform to implement our strategy, achieve profitable growth and build sustainable value for our shareholders. We are well on our way to becoming Europe’s best local airline.”
Flybe’s third quarter trading for 2013/14 was in line with management expectations, with total revenues for its UK airline business broadly flat at £137.6 million, despite a 1.8pc cut in capacity. Passenger numbers grew by 9.2pc to 1.9 million.
Meanwhile, “white label” sales for its joint venture in Finland climbed 23.7pc to £52.2 million.
Liberum analyst Gerald Khoo said: “Part of Flybe’s strategy to improve its commercial performance is better revenue management, and there is clear evidence of this being delivered, with lower average fares (down 8.1pc in Q3) driving stronger volume growth, but with revenue per seat improving.”
A father and son who joined forces to set up their own business are hoping to push the boundaries as their company goes from strength to strength.