Shares in Flybe have hit strong turbulence after the regional airline group issued a profits warning.
The firm’s stock plunged by almost 15% in early trading after it revealed that higher than expected maintenance costs encountered in improving the reliability of its aircraft – particularly the Bombardier Q400 turboprop –had hit the bottom line in the first half of the current financial year..
Flybe now expects adjusted pre-tax profits to come in between £5 million and £10m for the first six months of the year, a significant deterioration from the consensus estimate of £15m and well below the £15.9m booked a year ago.
The company said the lower return included £6m of previously guided costs relating to the developement of new digital platforms for the airline.
The poorer than expected first half comes after Flybe booked a £19.9m pre-tax loss in the year to March 31.
Despite the figures, CEO Christine Ourmieres-Widener was upbeat.
She said: “While half-year profits are lower than expected, I am confident that we are still on a clear sustainable path to profitability in line with our stated plan.”
The figures came as Dundee Airport operator HIAL revealed a 63.6% drop in passengers at the Riverside airstrip in the three months to September.
Dundee Airport saw 5,513 passengers pass through its doors in the period, almost 10,000 fewer than in the same period a year earlier when Flybe was still operating a flight to Amsterdam.
The service to the Dutch capital was withdrawn in December and Flybe no longer flies from the city at all.
Barra, Campbeltown, Tiree and Wick airports had fewer passengers than Dundee in the period.
Overall, Inverness remained HIAL’s top performer, welcoming 268,468 passengers in the quarter to September.