Flybe fell to the bottom of the FTSE All-Share index Thursday after reporting flat passenger volumes and revenues. Shares in the company fell more than 8% after it said passenger revenue per seat was in line with the same quarter last year, while passenger volumes were at 1.8m. Flybe’s load factor dropped 2 percentage points to 68%. The company, which has announced a code-share agreement with Virgin Atlantic, said this was due to a temporary increase in capacity following the Paris terror attacks. “We’re on track despite a very difficult environment,” said Saad Hammad, CE of Flybe. “The Paris attacks had a very dramatic effect on travel across all destinations. Demand has recovered, confidence [in air travel] has heightened and I’m cautiously optimistic for the future.” Hammad said Flybe had come under pressure from rival airlines adding routes to their network. “Lower fuel costs have seen lots of capacity injected into the market — EasyJet have more than doubled capacity growth, for instance, and that has had a dilutionary impact on yields,” he said. “But we’ve been able to weather these exogenous shocks well, and the new Flybe is much more resilient.” The company told investors its additional capacity for this summer was “selling through as planned”. However, with 21% of summer capacity sold, it remains three percentage points behind the same quarter last year.<br/>
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Flybe, Europe’s biggest regional airline, wants to expand code-sharing agreements with long-haul carriers to boost passenger numbers after barely breaking even in its last fiscal year. Flybe stock fell to an 11-month low after CEO Saad Hammad said the UK carrier earned a “wee” pretax profit in the 12 months through March. He said the figure in line with estimates from analysts, who were predicting earnings of GBP3.3m, according to a Bloomberg survey. The company is scheduled to release detailed financial figures in June. The CEO is trying to restore earnings after the breakup of an unprofitable joint venture with Finnair contributed to a GBP35.6m-pound pretax loss in the year through March 2015. Hammad said Thursday that a decline in the proportion of seats filled in Q4 of fiscal 2016 stemmed from recent terrorist attacks in Paris and Brussels that deterred travellers. “The operating environment is still very difficult and uncertain” following the attacks, and Flybe faces other challenges as it’s not fully hedged against shifts in the pound-dollar exchange rate or oil prices, said Wyn Ellis, an analyst at Numis Securities. The company wants to bring the number of code-sharing airline partners into double digits from nine now after existing deals generated about extra 500,000 passengers in the fiscal year, Hammad said. Flybe will limit future cooperation to code-sharing, which enables partners to book seats on each other’s flights and split revenue, because full-fledged joint ventures are too complex, Hammad said.<br/>
AirAsia has signed a multi-million dollar deal with UK-based Mirus Aircraft Seating to retrofit its entire Airbus A320 fleet with lightweight composite-based seats. The deal, which was signed at the Aircraft Interiors Expo (AIX) in Hamburg, will see Mirus deliver “tens of thousands” of the seats, the company said. Mirus was founded in February 2015. Mirius said its new Hawk seat uses composite technology to reduce moving parts and complexity, enabling a near 40% weight reduction compared to conventional metal-framed seating. The makers also claim the seat offers space savings due to its slimline design. AirAsia says the seat will also be fitted to the carrier’s upcoming 200-strong A320neo deliveries, pending full regulatory approvals.<br/>
Indian banks have rejected an offer by Vijay Mallya, the erstwhile liquor baron, to settle the country’s most high-profile loan dispute by repaying about half of the $1.3bn owed by his defunct Kingfisher Airlines. Informed of the decision by 17 lenders at a hearing on Thursday, India’s supreme court ordered the tycoon to provide a full account of his global assets, and those of his wife and children. Mallya, until 2013 the controlling shareholder at United Spirits, India’s largest spirits company, is embroiled in a bitter battle with lenders to Kingfisher Airlines, which collapsed with $1.3b of outstanding loans in 2012. While certain Indian commentators cheered the banks’ tough stand against Mallya, some analysts suggested lenders should have accepted his proposal to repay about $650m. The 17 banks, led by State Bank of India, had been resigned to a long legal battle to recover Kingfisher’s unpaid debts.<br/>