Flybe to cut more jobs with new cost-saving plan

This story is sourced from Pro
See more Pro news »

UK regional operator Flybe Group is intending to cut its workforce by another 500 personnel under additional restructuring efforts, although the company’s half-year results have shown evidence of progress.

Flybe has already implemented a previously-disclosed two-phase cost-saving programme, but expects to save another £7 million ($11 million) this year, and £26 million annually from next year, through an additional action plan.

The plan focuses on cutting surplus capacity, reviewing the fleet mix and examining unprofitable routes and bases.

Flybe also says it aims to reduce costs through discussions with suppliers and adopting a more “rigorous, analytical approach” to its commercial activity.

“This will require tough decisions to be taken over the coming months,” says the company, adding that the proposals will “regrettably” lead to 500 job losses across its business.

Previous cost savings were “necessary”, says chief executive Saad Hammad, but “we simply needed to do more and to do it immediately”.

“Unfortunately there is a proposal for further redundancies,” he adds. “We will consult with the trade unions and employees to ensure that this is done fairly and delivers the right outcome for the business.”

Under Flybe’s previous cost measures, 490 people left the company in 2012-13 and another 100 left in the first half of 2013-14.

The company says the “successful implementation” of the previous cost measures are reflected in its interim financial performance.

Flybe ended its half-year to 30 September 2013 with an operating profit of £8.9 million and a pre-tax profit of £13.8 million, turning around last year’s losses at the same point.

Total revenues under management increased by 20% to £477 million during the first half, including those from its Flybe Finland joint venture, which is “on track” to be profitable over the full year.