Published: Fri, November 16, 2018
Finance | By Loren Pratt

Flybe puts itself up for sale

Flybe puts itself up for sale

Flybe is putting itself up for sale - weeks after a savage profit warning.

A Flybe plane prepares to take off in rainy conditions at Leeds Bradford Airport.

The airline's stock has lost almost two-thirds of its value since the company issued a profit warning last month, underscoring challenges faced by rival European airlines including Ryanair Holdings Plc RYA.I Wizz Air Holdings Plc WIZZ.L and Easyjet Plc EZJ.L .

In March it pulled out of early-stage talks to buy the airline.

Flybe now serves around eight million passengers per year.

The announcement came as the airline announced its profits for the six months from April to September had halved to £7.4m, compared with the same spell in 2017.

Net debt ballooned from £59.1m in March 2018 to £82.1m for the airline's latest period, while cash flow shrank by nearly £25m to £70.6m, with the firm blaming weak sterling.

It has lost more than 60% of its value over the year to date, prior to the start of trading on Wednesday.

Passenger revenue per seat grew 7.9% to £60.18 during the half and the load factor increased by 8% to 84.0% from a year earlier, owing to better utilisation of the fleet, the company said.

Christine Ourmières-Widener, chief executive of Flybe, said: "Continued improvements are being seen into quarter three which demonstrates the popularity of Flybe for our customers".

But she added: "There has been a recent softening in growth in the short-haul market, as well as continued headwinds from higher fuel and currency costs".

The Group is undertaking a comprehensive review of various strategic options, including further capacity and cost saving measures, initiatives to strengthen the balance sheet and preserve cash resources, as well as a potential sale of the Company.

Reporting Flybe's interim results, auditors PwC also warned that there was "significant doubt about the Group's ability to continue as a going concern", due to uncertainty surrounding credit card acquirers demanding higher cash collateral.

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