{"id":3333,"date":"2018-10-17T11:08:22","date_gmt":"2018-10-17T11:08:22","guid":{"rendered":"http:\/\/www.styledeals.co.uk\/blog\/flybe-shares-sink-on-profit-warning\/"},"modified":"2018-10-17T11:08:22","modified_gmt":"2018-10-17T11:08:22","slug":"flybe-shares-sink-on-profit-warning","status":"publish","type":"post","link":"https:\/\/www.styledeals.co.uk\/blog\/flybe-shares-sink-on-profit-warning\/","title":{"rendered":"Flybe shares sink on profit warning"},"content":{"rendered":"\n
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\"FlybeImage copyright<\/span>
\n Getty Images<\/span><\/p>\n

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Flybe shares have fallen more than a third after issuing a profit warning, blaming poor demand, a weaker pound and higher fuel costs.<\/p>\n

The airline said in a trading update it now expects a full-year pre-tax loss of \u00a322m before – far higher than analysts had expected.<\/p>\n

It has taken a \u00a329m hit from weak sterling and a rise in fuel prices.<\/p>\n

However, the overall loss would be closer to \u00a312m due to a \u00a310m windfall from ending an onerous lease.<\/p>\n

In June the Exeter-based airline reported an annual pre-tax loss of \u00a319.2m, which it blamed on poor winter weather, a major IT overhaul and additional maintenance costs.<\/p>\n

Christine Ourmieres-Widener, chief executive of Flybe, said the market had softened in recent weeks after passenger revenue per seat rose 6.8% over the summer period.<\/p>\n

“We are reviewing further capacity and cost-saving measures. Stronger cost discipline is starting to have a positive impact across the business, but we aim to do more in the coming months, particularly against the headwinds of currency and fuel costs,” she said.<\/p>\n

“We continue to strengthen the underlying business and remain confident that our strategy will improve performance.”<\/p>\n

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Image copyright<\/span>
\n SOPA Images<\/span><\/p>\n

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Peter Morris, an aviation economist with FlightGlobal, argued that the UK economy has affected Flybe’s performance this year.<\/p>\n

“Given that the pound is weakening and they’ve got to buy their fuel and leases in dollars, you’ve got a challenge where your revenues are either fixed or declining, and your costs are rising,” he told the BBC.<\/p>\n

There was a market for Flybe in taking passengers to and from secondary UK cities to destinations across Europe, and opportunities in providing contract flying to other airlines, Mr Morris said.<\/p>\n

However, Flybe was “sandwiched” between the business model of budget airlines such as Ryanair, and the network carriers like British Airways that use short-haul flights to connect with long-haul services.<\/p>\n

“For example, it might fly from Southampton to Amsterdam, but it’s not a major trunk route, so it doesn’t have enough corporate flyers. But if it gets to a critical mass, then low cost airlines will join in and fly those routes at lower costs,” Mr Morris said. “If you are successful, either group will come after you.”<\/p>\n

However, Flybe would first need to weather the winter period, where demand was typically the lowest, he warned.<\/p>\n

Shares fell 11.8p to 20.3p in morning trading, valuing the firm at just \u00a368m.<\/p>\n

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Flybe has 78 planes, two fewer than at the end of March.<\/p>\n

Its interim results will be issued on 14 November.<\/p>\n<\/p><\/div>\n


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Source<\/a> by [author_name]<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Image copyright Getty Images Flybe shares have fallen more than a third after issuing a profit warning, blaming poor demand, a weaker pound and higher fuel costs. The airline said in a trading update it now expects a full-year pre-tax loss of \u00a322m before – far higher than analysts had expected. It has taken a … <\/p>\n","protected":false},"author":0,"featured_media":3334,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-3333","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general"],"_links":{"self":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts\/3333","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=3333"}],"version-history":[{"count":0,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts\/3333\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/media\/3334"}],"wp:attachment":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=3333"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=3333"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=3333"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}