Shares in regional airline Flybe jumped over 12 percent at market open on Wednesday, after new routes between Heathrow and Scotland led to a significant boost in passenger numbers.
Passenger revenue grew by 11.7 percent in the first quarter, with seat capacity growth slowing to 3.5 percent. Both load factor and passenger yield improved, lifting passenger revenue to £174 million, up from £155.8 million last year.
During the quarter Flybe negotiated a new five-year franchise agreement with Eastern Airways, for routes including Aberdeen-Sumburgh, Glasgow-Sumburgh, Edinburgh-Sumburgh, Glasgow-Manchester, Aberdeen-Kirkwall, and Glasgow-Stornoway.
Christine Ourmieres-Widener, Chief Executive Officer, said:
“I am very encouraged by my first six months as CEO at Flybe. Both load factor and passenger yield have improved as expected, and with the greater control we have over capacity we will focus on rebuilding unit revenues.
“Alongside this, we are investing in the future, as demonstrated by our new Heathrow flights, our commitment to improve operational performance and deliver an enhanced customer digital platform. I am very excited about developments in Scotland, with our new routes complemented by the recently announced partnership with Eastern Airways, which gives increased connectivity options for passengers, and shows our long-term commitment to Scotland.
“There remains a lot to be done, but we have the firm foundations needed to progress our plans for the business. In the second half of 2017/18, given the planned capacity reductions, there will be an increased focus on efficiency to improve operational performance and manage unit costs.”
This figures are an encouraging improvement on Flybe’s report last month that it had recorded a £19.9 million pre-tax loss after taking IT writedowns and revaluation losses on aircraft loans agreed in US dollars.
Shares in Flybe are currently trading up 12.03 percent at 39.77 (0953GMT).