Flybe takeover talks raise questions over airline’s Belfast routes

BELFAST City Airport’s anchor airline Flybe could be heading for a possible merger or takeover, raising questions over the future of some of its Northern Ireland routes.

Just weeks after issuing a profit warning, the Exeter-based carrier confirmed yesterday that it is in talks about a possible sale.

The airline currently flies to 15 UK destinations from Belfast City Airport.

Last month Flybe announced it will axe its Belfast to Liverpool route at the end of December because of low passenger numbers.

Despite initially saying that it will increase the number of flights on its Belfast to Glasgow route as a result, the carrier said yesterday that it is looking at cutting further costs and flight capacity as it battles challenging conditions in the industry.

A recent study of Flybe’s most profitable bases by independent consultancy Aviation Analytics puts Belfast City Airport down the list at number 20, assessing its profit-per-seat ratio as “marby

Chief: Christine Ourmieres-Widener

ginal”. It’s likely that a takeover or merger will result in changes to Flybe’s services, opening up the possibility that more of its marginal or loss-making routes will face the axe.

Yesterday it emerged that Flybe is in talks with a number of “strategic operators” about a potential sale and has hired Evercore as adviser to help with the review and sale process.

The airline’s recent profit warning came in the wake of falling demand and a £29m hit from rising fuel costs and the weak pound.

The alert sent shares tumbling more than a third on the day, and nearly 75% has been wiped off its stock market value since last December.

But shares lifted by 6% after news of the sale plans.

Stobart Group walked away from a bid for Flybe in March after the two firms failed to agree terms.

Flybe has 78 planes and carries around eight million passengers a year.

In half-year results also announced yesterday, Flybe saw cost-cutting help lift underlying pre-tax profits to £9.9m from £9.2m a year earlier. Statutory pre-tax profits for the six months to September 30 more than halved to £7.4m from £16.1m a year earlier.

Group revenues also fell 10% or 2.4% on an underlying basis to £409.2m after it cut capacity by 9%. Passenger numbers edged 0.6% higher to 5.2 million.

Chief executive Christine Ourmieres-Widener said the group continued to see improvements in the third quarter and added that cost savings had already helped to drive progress in boosting profits.