Flybe annual results announced
Flybe today announced its results for the year ended 31st March 2015.
This year represented the first full financial year of Flybe’s three year transformation plan and the focus has been on resolving legacy issues and laying foundations for profitable growth, with significant progress on both fronts.
Flybe is now returning to revenue and capacity growth as it enters the next chapter of its transformation.
Financial highlights:
· 3.3% increase in Passenger Revenue per Seat to £51.35 (2013/14: £49.70)
· 5.7percentage points increase in Load Factor to 75.2% (2013/14: 69.5%), an annual all-time high
· 7.7m Passengers, held in line with previous year as a result of improved Load Factor
· 7.5% reduction in Group Revenue to £574.1m (2013/14: £620.5m), as a result of reduction in charter flying and a planned reduction in capacity of 7.6%
· £27m incremental gross cost savings delivered in the year, on top of the £47m reduction achieved in 2013/14. Cumulative gross savings over two years to £74m, £3m ahead of the commitment made in November 2013
· Reported loss before tax of £(35.6)m, including £(12.0)m loss on discontinued operations of Finland JV.
· Illustrative profit of £16.6m excluding £(10.2)m USD aircraft loan revaluations, £(26.0)m surplus aircraft costs, £(12.0)m discontinued operations and £(4.0)m EU261 provision (2013/14: £1.7m)1
· Strong Balance sheet with Total Cash as at 31st March 2015 of £195.9m (31st March 2014: £218.4m). Total Cash per Share was 90.4p
Operational highlights
Resolution of nearly all of the Company’s legacy issues:
· Completed its cost restructuring and improved aircraft utilisation by 13% through improved schedule planning and design and more effective crewing and rostering
· Exited the loss-making joint venture with Finnair
· Exited, without any penalties, the USD892m obligation to buy 24 additional E175 jets from Embraer with a simultaneous agreement to secure young, attractively priced turbo-prop Q400s
· Signed landmark deal with Bombardier to upgrade the reliability of Flybe’s 45 Q400 aircraft
· Found solutions for seven of the 14 surplus E195 jets. Further work ongoing to divest the remaining seven E195 jets.
Significant progress in laying foundations for future profitable growth:
· Drove unit revenue growth in core UK business through investment in yield and improved commercial execution
· Launched two new bases (Bournemouth & Aberdeen) and 26 new routes
· Signed new codeshare agreements with Cathay Pacific and Finnair and commercial partnerships agreed with Avios, STA Travel and booking.com
· Signed a six year agreement with SAS, Scandinavia’s largest carrier, for a new regional White Label programme at Stockholm initially with four turboprop aircraft to start in the autumn of 2015
· Signed an eight and a half year contract with Airbus for air frame related maintenance, repair and overhaul of the Royal Air Force’s new fleet of 22 A400M Atlas airlifters at Brize Norton
Q1 2015/16 UK Trading @ 31st May 2015 (versus prior year)
· 13% increase in capacity
· 65% of capacity already sold, 2ppts behind prior year in part due to year-on-year Easter shift
· Stable yields
· 1.7% decrease in passenger revenue per seat
Summer trading is on track with the additional capacity selling through as planned.
Saad Hammad, Chief Executive, said: “We have just completed the first full financial year of our three year transformation plan. Despite a more challenging environment than anticipated, significant progress has been made. There is much more to do, but I am keen to put on record my thanks to all our pilots, cabin crew, engineers and everyone in the field and at HQ in Exeter for their commitment and effort. Flybe is back on track to recovery and profitable growth."
Saad Hammad joined Flybe as Chief Executive Officer on 1 August 2013.
He joined Flybe from easyJet plc, where he was Chief Commercial Officer between 2005 and 2009. Mr Hammad was a Non-Executive Director of Air Berlin plc and, since 25 April 2014, has been a Non-Executive Director of Pegasus, the leading Turkish low-cost carrier.
He has also held senior executive roles at a number of leading corporations including The Gores Group, Procter & Gamble, Thorn-EMI, Vision Express and Tibbett & Britten.
* Image courtesy of Flybe
