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Regional airline’s profits tumble

REGIONAL airline Eastern Airways - which operates flights between Newcastle and Norway - saw profits tumble by 63% as the recession tightened its grip on the aviation sector in 2009.

The figures released by Companies House show a fall in pre-tax profits to £1.24million in 2009, against a surplus of £3.36million the year before.

But the performance last year was affected by exceptional start-up expenses of £963,000 relating to a new long-term contract with Bristow Helicopters for flying offshore workers between Aberdeen and Scatsta, Shetland, on behalf of major oil producers.

Profits were also hit by restructuring and termination costs of £478,000 after a review of scheduled services found areas where savings could be achieved.

Revenue was down last year at £70.97million, compared with £73.52million in 2008.

But in their annual review, Eastern’s management said passenger numbers on its scheduled services and charter operations increased 7% despite the economic downturn.

Eastern operates from UK airports including Aberdeen, Stornoway and Wick as well as Birmingham, Bristol, Cardiff, Durham Tees Valley, East Midlands, Humberside, Leeds/Bradford, Newcastle, Norwich and Southampton.

Foreign airports served include Bergen and Stavanger, and just this month the airline announced it had set up a base at Dijon Bourgogne Airport for domestic services in France.

Formed in 1997, Humberside-based Eastern initially built its network of scheduled services around the North Sea offshore industry and flights between the east coast of England and Aberdeen.

The company – owned by chief executive Richard Lake and chairman Brian Huxford – employed 429 people on average during 2009, which was down from 444 the year before.

Separate accounts for subsidiary Eastern Airways (UK) showed pre-tax profits of £2.42million on turnover of £64.24million in 2009, against £2.53million and £58.73million respectively the year before.

This was posted in Bdaily's Members' News section by Ruth Mitchell .