Airline FLYB (Flybe Group) released an IMS for Q3
(http://is.gd/yyRgnb). “Turnaround gains momentum”. “UK scheduled revenue per seat was up 2.3%, whilst costs per seat (excluding fuel and restructuring costs) were down 5.2%. In Finland, revenue from white label flying increased by 23.7%”. “We are on track to deliver £40 million of annual cost savings from Phases 1 and 2 of the Turnaround Plan by 31 March 2014, and significant rapid progress has been made already on the additional Immediate Actions announced in November last year.” Sounds pretty good.
This had been on my radar (no pun intended) since late last year, but I had no position. The IMS looked pretty good, as I am sure
current investors expected. This is shaping up to be a nice little turnaround play. I am hardly the first person to the party, but I think there is plenty of punch left in the bowl. FLYB is trading at less than half of the EV/Sales of its peers (0.29 as compared to the median of 0.61). Sales are looking increasingly rosy, too.
So, a new position for me, albeit a small one.
In other news, I’ve made some changes to my Stockopedia “Magic Hat” fantasy fund (http://is.gd/ySBRN6
). $RTN.L (Restaurant Group) leaves, and $DGO.L (Dragon Oil) enters. RTN has proven to be a great little growth company, but the valuation looks a little stretched to me. I’ll present a fuller rationale in the next few days, when I’ll have some time to compose my thoughts a little better.
In the meantime, happy and prosperous investing to you all.