British Flybe enters formal sale process

Flybe up for sale weeks after profit warning

The skies ahead now look very dark for regional airline Flybe (BE/BEE) as it puts itself up for sale following severe profit warnings.

Shares in struggling airline Flybe have surged after it put itself up for sale amid turbulence caused by currency volatility and higher fuel costs.

Flybe has 78 planes operating from smaller airports including London City, Southampton and Norwich, and flies to destinations across the United Kingdom and Europe.

Flybe's stock plunged after a profit warning last month, underscoring challenges that are also affecting bigger European rivals including Ryanair Holdings Plc Wizz Air Holdings Plc and easyJet Plc.

The group has 78 planes and serves around eight million customers a year.

For the six months to 30 September, pre-tax profits fell by 54% to £7.4m and revenues slipped by 2.4% to £419.2m.


British infrastructure and support services company Stobart Group scrapped plans to buy Flybe in March after being rebuffed.

Since September, the company's shares have fallen by nearly 75 per cent.

Shares in Flybe jumped as much as 44% on opening, before paring back to stand 11% higher. Earlier in the year, the airline announced a new strategy that would see its fleet cut from 85 to around 70 aircraft by early 2020 in an attempt to improve profitability and increase revenue per seat.

Reporting Flybe's interim results, auditors PwC also warned that there was "significant doubt about the Group's ability to continue as a going concern", due to uncertainty surrounding credit card acquirers demanding higher cash collateral.

The UK carrier is affected by weaker sterling value, softening short-haul market growth and, of course, increasing fuel prices, according to the company CEO Christine Ourmières-Widener.

The Group is undertaking a comprehensive review of various strategic options, including further capacity and cost saving measures, initiatives to strengthen the balance sheet and preserve cash resources, as well as a potential sale of the Company.

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