Airline warns jobs at risk after profit slump

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AIRLINE Flybe, which operates from Doncaster’s Robin Hood airport, has warned jobs may be at risk as it slashes costs after challenging conditions sent it into the red.

The Exeter-based carrier outlined plans to make annual savings equivalent to £2 per seat as it said there was ‘little sign of recovery’ in the UK domestic market.

It warned there may be some impact on its workforce of 3,000 staff in the UK and up to 700 in Europe as part of a group-wide review of costs.

Flybe reported pre-tax losses of £1.3 million in the six months to September 30 – against profits of £14.3 million a year earlier – after being hit by sky-high fuel costs and falling numbers of fliers.

The group, which flies from airports including Bristol, Cardiff, Robin Hood, Edinburgh and East Midlands, saw UK passenger numbers fall 3.6 per cent to four million in the half-year.

Its fuel costs leapt 22.7 per cent to £68.6 million – or from £8.73 to £11.06 per seat – and it said demand was being stifled by air passenger duty hikes.

The group said: “Flybe is currently operating in possibly the most challenging conditions since its creation as a new-generation regional airline 10 years ago.

“The UK domestic aviation market has seen passenger numbers reduce by 20.6 per cent since 2007. UK air passenger duty increased by 160 per cent over the same period and fuel prices are at record annual highs.”

Shares fell six per cent following the announcement of the results.

Jim French, chief executive, said the group had no choice but to cut costs in the UK, with ‘no sign of any glimmer of hope’ of a turnaround in the UK market.

He said: “We can no longer wait for the economy to turn, or for fuel prices to fall, or for the Government to reduce taxes.”