FLYBE, Europe’s largest regional low cost airline, has announced record financial results for the year ended 31 March 2007, with a 17% increase in turnover to £355million and an overall profit before tax of £15.6 million, representing an improvement of £20m over the previous year. Of particular note was Flybe’s continuing strong growth in ancillary revenues – up 63% from 2005/06 to 2006/07 while some 5 million passengers were carried in the year 2006/2007.
Flybe’s fleet rationalisation programme is well on schedule to deliver a two-type environmentally sensitive fleet by 2009. Maintaining its position as a global aviation innovator, the last year saw three world-firsts for Flybe:
• launch customer for Embraer 195 aircraft,
• introduction of aviation industry’s first eco-labelling scheme,
• and world’s first airline to introduce baggage charging.
Operationally, the airline has also confirmed the successful integration of the BA Connect business following its March acquisition As a result Flybe is on target to deliver its planned £40.0m of cost and ancillary revenue synergies having completed the rationalisation of production facilities in the Isle of Man and Bristol; the closure of the Manchester head office; new beneficial airport deals and having successfully converted BA Connect passengers to Flybe’s high ancillary revenue sales model. Flybe has also successfully sold of all of the Embraer 145 aircraft inherited from BA Connect and at prices within the funding provided from British Airways for this purpose. Significant progress has also been made to sell the small number of remaining BAe 146s in Flybe’s fleet with the remainder expected to be disposed of by February 2008.
Over the last five years, Flybe has grown from an airline with 41 routes and 1.9 million passengers to what it is today – a nationally recognised brand that flew 5.0 million passengers last year, with new aircraft orders worth $3bn, flying 125 routes at end of 06-07 (152 currently) and that has delivered passenger and turnover growth of over 20% compound per annum since 2002.
In a year of outstanding achievement and strategic development, which also delivered an exceptionally strong trading performance, Flybe Chairman and Chief Executive Officer, Jim French says: “Since 2002, Flybe has been transformed into Europe’s largest regional low cost airline. Our five year transformational programme has been rewarded this year by a £20m improvement in profit before tax and exceptional items to £15.64m.
He continued: “In 2006/07, the management and the whole Flybe team faced very considerable challenges in acquiring, and then operationally integrating, BA Connect over a very short timescale. This in itself was a remarkable achievement. To have done so whilst also managing to further grow the Flybe business and achieve our highest profit ever was truly outstanding.
The importance of the acquisition of BA Connect cannot be overstated. Flybe is now a much stronger business with good cash reserves, a more balanced network and a significantly reduced risk profile.”
Flybe is now the largest regional low cost airline in Europe, employing over 3,000 staff, expected to carry 7 million passengers this year and operating over 400 flights each weekday.
Mr French adds: “I believe that Flybe is well set to achieve even greater heights as it builds on its position as the largest and only low cost regional airline in Europe and, with cash in the bank and a new fleet, we are in a hell of a position to go forward!”
Commenting on Flybe’s position in Exeter, Mr French said: “Exeter is very important for us and I’m delighted to see our services in the South West go from strength to strength. Being headquartered here gives us an insight into the local economy and how important aviation is for our region.
I am proud to say that Flybe employs more than 1000 people in Exeter in high quality, sustainable jobs and these financial results mean Flybe can look to the future in the South West and beyond with huge confidence. Flybe is committed to expansion and as airlines continue to consolidate, Flybe will be one of the few remaining players.”