Jet2 parent group moves into profit

THE parent company of airline Jet2 moved into profit today but said it would not be paying shareholders a dividend due to “the current economic climate and its trading performance for the year”.

Dart Group said it had substituted “profitability for growth” but said that summer trading remains “very encouraging” and that  passenger numbers had risen by 32% to four million.

Announcing its preliminary results for the year ended March 31 2008 Dart Group said turnover increased 23% to £29m and reported pre-tax-profits of £11.8m compared to a loss the previous year of £3.6m.

The group saw its share price rise by almost a quarter to 20p following this morning’s announcement – valuing the business at around £28.2m.

Jet2 has undergone a significant expansion – increasing its route network from 114 to 133 destinations.

The airline principally operates out of Leeds-Bradford and Manchester airport and the group said that according to figures from the Civil Aviation Authority Jet2 flew more passengers from the north of England than any other airline.

The group said its net debt stood at £17.2m – a rise on the previous year’s figure of £14.1m – and capital expenditure had been reduced to £38.5m compared to £70.2m in 2007.

To off-set the major costs associated with fuel the airline said it had sought to delay the impact of soaring prices by hedging its expected fuel requirements for the year ending March 31 2009.

The group said it saw scope for considerable growth within its holiday package business jet2holidays.com.

Following its launch in 2007 more than 34,000 passengers used the service and chairman Philip Meeson  said that the group sees the business as a way to fly fuller planes by packaging scheduled flights with hotel packages.

He said the services would be supplemented with trips to specialist destinations – such as its recent announcement that it would be launching a number of New York shopping trips this winter.

The group said that it had made a significant development within the business following the introduction of its own in-house reservation system which allows the airline to work more effectively and makes the online  booking system easier for customers to use.

In December Dart Group moved its head office to the low-cost carrier’s base at Leeds Bradford Airport.

Mr Meeson said: ” The key to success in the scheduled low-cost travel market will increasingly become load factor as the industry tackles both higher fuel prices and the proposed introduction of an aircraft departure 
tax to replace the current per passenger based Air Passenger Duty. With our expected fuel requirements fully hedged for the current year and with a more focused flying programme, we are well placed to improve 
financial performance in this financial year.”

The group said its logistics chain Fowler Welch-Coolchain had had another successful year despite the poor weather reducing demand in supermarkets for chilled produce.

Mr Meeson said that turnover in the division had increased by 10% and that the group would be looking to grow the operation through acquisition.