June 8 British regional airline Flybe Group
set out plans to keep a lid on capacity as it contends
with increasing competition and slowing growth in consumer
The company said on Thursday that moves to slow its
expansion had already provided some benefits and that it would
cut capacity in the second half to leave it broadly flat for the
year to March 2018.
Performance in the current financial year to June 5 had
shown a 4.6 increase in passenger revenue per seat, Flybe said,
adding that it had sold 45 percent of its capacity versus 44
percent at the same point last year.
"Forward booking trends point to unit revenue improvements
that we view as encouraging," Liberum wrote in a client note,
adding that headwinds for the company were starting to
"moderate". It has a "Buy" recommendation on the stock.
Shares in Flybe, which connects British regional airports to
London and other European cities, rose 4.5 percent to 34.61
pence by 0803 GMT. They are down by around a fifth so far this
The company reported an adjusted pretax loss of 6.7 million
pounds ($8.7 million) for the year to March 31, against a 5.5
million pound profit the previous year.
Flybe said that IT costs were lower than expected at 4.8
million pounds, having warned in March that it expected a charge
of between 5 million pounds and 10 million pounds related to a
It has been contending with industry-wide challenges where
larger European airlines have driven down fares by adding more
seats to boost their market share in a period of lower oil
Flybe's own difficulties had been compounded by its large
exposure to the UK, where demand has experienced some turbulence
after the vote to leave the European Union, and due to its own
rapid capacity growth due to legacy commitments for additional
($1 = 0.7714 pounds)
(Reporting by Esha Vaish in Bengaluru; Editing by David