Flybe put up for sale

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Flybe is reportedly putting itself up for sale after profit warning & rising fuel costs.

Flybe, valued at £25 million by stock market price, is expected to announce a 12 million pound lose this year. It has been reported that the board will announce to the London Stock Exchange that it is exploring the possibility of a sale or Merger with a rival.

CAS Recruitments Managing Director Stephen Wilkinson recently wrote about the overcapacity within European aviation after Cobalt Air announced it would be ceasing operations.

Cobalt Air goes into administration only weeks after Primera Air and cello due to an inability to secure long term financing.

I have said for some time that the European market is ripe for consolidation, the market is at saturation point with little appetite from financiers to support airlines moving forward. Cobalt Air, sadly will not be alone, as I fear there is more to come.

Market saturation has been the primary driver for the decrease in ASM / RASM, combine this with rising fuel and labour costs and you have a lethal combination.

Ticket prices must inevitably and justifiably increase.
— Stephen Wilkinson MD CAS Recruitment 18/10/18

It is unclear at this stage which other airlines might be interested in purchasing Flybe, although bankers said one potential buyer could be Stobart Group who owns Southend Airport.

In September Flybe had a fleet of 78 aircraft and promised investors during September that it would continue to reduce capacity while focusing on it’s most popular routes.

""Consumer demand in domestic and near-continent markets has weakened in recent weeks and the board now expects this to continue into the second half," the company said last month.

"This together with higher fuel prices and weaker sterling will impact the expected second-half profit performance."

Christine Ourmieres-Widener, CEO of Flybe recently said;

stronger cost discipline...against the headwinds of currency and fuel costs.
— Christine Ourmieres-Widener, CEO of Flybe

Source Sky News: https://news.sky.com/story/brexit-and-fuel-costs-force-airline-flybe-to-put-itself-up-for-sale-11553619


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