7 February 2019 – trading update

The group has issued a re-assuring first quarter trading update, saying that the 2018/19 financial year has started in line with expectations. First quarter revenue rose 1% to £1.65bn, although lower margins led to the seasonal underlying loss for the period increasing by £14m to £60m.  Net debt at the period end was £1.58bn.  The short term outlook remains uncertain with Brexit and weaker consumer confidence having an impact.  The group has reduced capacity to take account of this whilst it has also announced a strategic review of its airline with a view to enhancing value for shareholders.  Until there is better clarity on prospects we retain our recommendation of HOLD.