11th Nov 2013 09:02
LONDON (Alliance News) - Flybe Group PLC Monday said it swung to a profit in the first half of its current financial year thanks to a jump in revenues and as its cost cutting and restructuring programme started to pay off, but its new chief executive announced a further revamp of the airline.
The company reported a pretax profit of GBP13.8 million in the six months to end-Sepetmber compared with a loss of GBP1.6 million a year earlier. Revenues rose To GBP351.1 million, from GBP340.8 million, while restructuring costs fell to GBP4.1 million, from GBP12.8 million.
New Chief Executive Saad Hammad, who joined the company in August, said the restructuring programme will continue, with up to another 500 jobs to go at the airline. He expects the programme to deliver further savings of GBP7 million in the current year and GBP26 million next year. Costs for the programme are expected to be GBP14 million this year and GBP27 million next year.
"I joined Flybe in August this year. It was clear to me that the existing Phase 1 and 2 cost savings were necessary, but we simply needed to do more and to do it immediately," Hammad said in a statement.
The airline, which mainly flies from local UK airports to European destinations, was hard hit by the economic downturn and competition from low-cost giants like Ryanair Holdings PLC. It has been cutting less-profitable routes, streamlining operations and cutting costs in an effort to return to profitability.
Flybe shares were up 13% at 77 pence early Monday, one of the biggest gains on the London market.
By Steve McGrath; [email protected]; @SteveMcGrath1
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