Flybe on course despite recession

Budget airline Flybe today said it became the UK's top domestic carrier last year after facing "the ultimate test" during the recession.

Flybe said it was one of only a handful of firms to post a profit in the recession as economic woes and huge volatility in the price of fuel hammered the industry.

The privately-owned carrier said it had seen "good profits" in the six months to September 30 and was winning market share as the industry convulsed under the economic pressure and steep falls in passenger demand.

The firm has benefited from consolidation in the airline sector, with rivals like BMI Baby pulling out of certain routes.

It said it carried more UK domestic passengers than any other airline between April and October last year.

Flybe saw passenger numbers rise 4.3% in the year to last March, but said the figure fell back in the first half of this financial year. Since June numbers have improved.

Chairman and chief executive Jim French said there had been a "marked upturn, post the bad weather, post Christmas" as confidence returns.

Flybe said it took more domestic passengers at London Gatwick than any other airline and operated four times more UK routes than any of its competitors.

It reported a pre-tax profit of £100,000 (€115,294) in the year to March 31, 2009 including one-off costs of £12.7m (€14.64m), down from £30.4m (€35m) in the previous 12 months.

During the period crude oil prices spiked to an all-time high of $147 a barrel, while the onset of the recession saw a steep decline in business flights and consumer demand.

The firm said as a result of the spiralling economic situation, losses in the three months to March last year were "unprecedented in Flybe's recent history".

Corporate travellers, which make up about 40% of the airline's business, had looked for cheaper tickets as the recession tightened its grip, but this tendency had relaxed recently.

The firm said business travel was now getting back to the levels of last year and predicted it would exceed those of 12 months before by February or March.

Ancillary revenues - including post-ticket sales of services such as seat allocation and its Flybe credit card - were up 30% in the year to last March.

But Mr French said the firm would not push for ever-higher charges on extras in the style of some short-haul rivals.

He said: "The Flybe business was put to the ultimate test during the year and I am delighted to report that it came through with flying colours."

Flybe was having a "good recession", he added and would be well placed to benefit when better economic conditions return.

The firm said it is now the largest scheduled airline - by traffic movements - at Belfast City, Birmingham, Cardiff, Exeter, Inverness, the Isle of Man, Jersey, Manchester and Southampton.

During the financial year to March, the firm launched its first Loganair franchise operations, increasing its Scottish regional coverage.

Flybe is also developing an aviation training business and plans to open a new training academy in Exeter, which is expected to be completed by the end of this year.

The airline has 194 routes in 13 countries and operates from 36 UK and 32 European airports.