Administrators reveal extent of Flybmi’s debts
Flybmi owed £37m when it collapsed, and many creditors, including passengers and suppliers, may only receive a small percentage of their claims, according to a report by administrators.
The BBC reports that when Flybmi cancelled all flights and filed for administration in February, passengers were due £3.8m under EU compensation rules and were told to contact travel agents, insurance or credit card companies for a refund.
Rolls Royce was owed £2.25m for a servicing contract, a statement of affairs says.
Stansted and Bristol airports were owed money by Flybmi, according to a list of unsecured creditors to the airline.
The carrier operated 17 aircraft, 14 of which were ‘detained’ after it went into administration ‘due to unpaid navigation service charges,’ according to the administrators BDO.
Parent company Airline Investments Limited (AIL) said the company made a loss of £6.8m in the year to 31 March 2018 and losses deepened during the rest of 2018.
In its report, BDO said: "The company was also becoming increasingly concerned about the potential impact of Brexit and the ability to conduct intra-European flying whilst operating under a UK Operators Certificate."
BDO said Flybmi’s trading was worse than forecast at the end of 2018 and beginning of 2019 when Flybmi’s ultimate owners, aviation entrepreneurs Peter and Stephen Bond, said they would stop funding Flybmi.
AIL said more than £40m had been invested in Flybmi in the six years before its collapse.
About 130 former Flybmi pilots and cabin crew now work for LoganAir, which has taken over many former routes, including those from Newcastle and Aberdeen as well as key contracts including the Derry-Stansted route.
Fifteen aircraft which carried Flybmi livery are currently, or will soon be, operated by LoganAir.
Airport landing slots controlled by Flybmi were ‘transferred’ to LoganAir before administrators were appointed ‘preventing the airports seeking to cancel them’, BDO says, adding that LoganAir is trying to sell the slots.
The two airlines used to ‘trade as sister airlines with their own management teams and brand identities but taking advantage of commercial, operational and procurement synergies’, according to AIL.
Lisa
Lisa joined Travel Weekly nearly 25 years ago as technology reporter and then sailed around the world for a couple of years as cruise correspondent, before becoming deputy editor. Now freelance, Lisa writes for various print and web publications, edits Corporate Traveller’s client magazine, Gateway, and works on the acclaimed Remembering Wildlife series of photography books, which raise awareness of nature’s most at-risk species and helps to fund their protection.
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