British Regional demand takes off

SHARES IN British Regional Air Lines, the small European carrier, jumped by 14 per cent yesterday when the company reported surging demand for flights on its 50-seat jets.

With profits up by more than one-third, the shares began to recover the status they enjoyed before the collapse of small cap stocks in September last year, rising by 10p to 80p.

The full-year results are the first since British Regional came to market in June last year, opening at around 100p a share. Yesterday the board declared its first dividend of 0.88p.

Three months after listing, the group was rocked by the economic gloom caused by the rouble crisis, which hit transport stocks particularly hard.

Airlines also suffered under the impact of discount competition from EasyJet and Go!, the carrier owned by British Airways. Amid warnings of a softening travel market, the shares took two months to plummet from 100p to below 30p.

Terry Liddiard, the chief executive of British Regional, responded by stepping up a successful experiment with 50-seat jet aircraft.

This class of jets became profitable to fly only last year and have proved valuable to small airlines that could operate less popular routes without the strain of having to fill 100 seats per flight. The jets also hold much greater passenger appeal than turboprop aircraft.

Mr Liddiard has bought six more jets and plans to convert the entire fleet of 45 aircraft as soon as he can.

The airline is also moving into new routes, including some from Sheffield, the UK's fifth-largest City. Sheffield only recently gained its own airport.

Amid last year's economic travails, few investors drew a sharp enough distinction between discount carriers such as EasyJet and regional airlines such as British Regional.

Analysts point out that cut-throat fare cutting has little effect on British Regional because it is usually the sole carrier on its typical routes. Where it is not, it has shown in the past that it is perfectly capable of fighting off competition.

Forecasts for 1999 are already being upgraded from the pounds 6m profit that analysts had expected. At 80p, the shares are on a forward price/earnings ratio of around eight - a hefty discount to the market - and qualify as a long-term buy.

Start your day with The Independent, sign up for daily news emails
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Neil Pavier: Management Accountant

£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...

Sheridan Maine: Commercial Accountant

£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...

Laura Norton: Project Accountant

£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...

Day In a Page

Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf
From Shakespeare to Rising Damp... to Vicious

Frances de la Tour's 50-year triumph

'Rising Damp' brought De la Tour such recognition that she could be forgiven if she'd never been able to move on. But at 70, she continues to flourish - and to beguile
'That Whitsun, I was late getting away...'

Ian McMillan on the Whitsun Weddings

This weekend is Whitsun, and while the festival may no longer resonate, Larkin's best-loved poem, lives on - along with the train journey at the heart of it
Kathryn Williams explores the works and influences of Sylvia Plath in a new light

Songs from the bell jar

Kathryn Williams explores the works and influences of Sylvia Plath
How one man's day in high heels showed him that Cannes must change its 'no flats' policy

One man's day in high heels

...showed him that Cannes must change its 'flats' policy
Is a quiet crusade to reform executive pay bearing fruit?

Is a quiet crusade to reform executive pay bearing fruit?

Dominic Rossi of Fidelity says his pressure on business to control rewards is working. But why aren’t other fund managers helping?
The King David Hotel gives precious work to Palestinians - unless peace talks are on

King David Hotel: Palestinians not included

The King David is special to Jerusalem. Nick Kochan checked in and discovered it has some special arrangements, too
More people moving from Australia to New Zealand than in the other direction for first time in 24 years

End of the Aussie brain drain

More people moving from Australia to New Zealand than in the other direction for first time in 24 years
Meditation is touted as a cure for mental instability but can it actually be bad for you?

Can meditation be bad for you?

Researching a mass murder, Dr Miguel Farias discovered that, far from bringing inner peace, meditation can leave devotees in pieces
Eurovision 2015: Australians will be cheering on their first-ever entrant this Saturday

Australia's first-ever Eurovision entrant

Australia, a nation of kitsch-worshippers, has always loved the Eurovision Song Contest. Maggie Alderson says it'll fit in fine
Letterman's final Late Show: Laughter, but no tears, as David takes his bow after 33 years

Laughter, but no tears, as Letterman takes his bow after 33 years

Veteran talkshow host steps down to plaudits from four presidents
Ivor Novello Awards 2015: Hozier wins with anti-Catholic song 'Take Me To Church' as John Whittingdale leads praise for Black Sabbath

Hozier's 'blasphemous' song takes Novello award

Singer joins Ed Sheeran and Clean Bandit in celebration of the best in British and Irish music
Tequila gold rush: The spirit has gone from a cheap shot to a multi-billion pound product

Join the tequila gold rush

The spirit has gone from a cheap shot to a multi-billion pound product
12 best statement wallpapers

12 best statement wallpapers

Make an impact and transform a room with a conversation-starting pattern
Paul Scholes column: Does David De Gea really want to leave Manchester United to fight it out for the No 1 spot at Real Madrid?

Paul Scholes column

Does David De Gea really want to leave Manchester United to fight it out for the No 1 spot at Real Madrid?