Flybe’s boss has insisted that the airline is “back on track to recovery” despite making a pre-tax loss of £35.6 million during its last financial year.
The UK regional carrier said that one major reason for the scale of the losses was the £12 million cost of its struggling Flybe Finland joint venture, which was sold to partner Finnair for €1 in November 2014.
Flybe’s revenue also fell by 7.5 per cent to £574.1 million for the year ending March 31, 2015, as the airline reduced capacity in the UK by 7.6 per cent to 10.3 million seats as part of plans to “optimise” its network.
But Flybe said it had increased load factors on remaining UK services by 5.7 percentage points during the year, which had helped to maintain passenger numbers at 7.7 million.
CEO Saad Hammad said: “We have just completed the first full financial year of our three-year transformation plan. Despite a more challenging environment than anticipated, significant progress has been made.
“There is much more to do but I am keen to put on record my thanks to all our pilots, cabin crew, engineers and everyone in the field and at HQ in Exeter for their commitment and effort. Flybe is back on track to recovery and profitable growth.”
The airline added in a statement that it was “returning to revenue and capacity growth as it enters the next chapter of its transformation”.
Flybe said that it had already increased capacity by 13 per cent in the UK for the three months between April and June, 2015, compared to the same quarter last year, although passenger revenue per seat has dropped by 1.7 per cent year-on-year.
The airline saw operating costs drop by 5.7 per cent to £565.7 million in 2014/15, as its fuel bill fell by 12.1 per cent to £105.5 million as the price of oil slumped by around 50 per cent during the financial year.
The Exeter-based airline said that it would have made an "illustrative" pre-tax profit of £16.6 million in the 2014/15 financial year when one-off costs such as the losses from Flybe Finland, the revaluation of aircraft loans and the cost of getting rid of surplus aircraft have been taken into account.