Good morning!

Today is my visit to Boohoo.Com (LON:BOO) in Manchester, so I'll rattle through a few announcements here, and then run for a train from Euston. Should be an interesting visit, so of course I'll report back with my findings tomorrow.


Flybe (LON:FLYB)

Share price: 91.5p (up 2.2% today)
No. shares: 216.7m
Market cap: £198.3m

(at the time of writing I hold a long position in this share)

Interim results to 30 Sep 2015 - this is the first set of clean numbers that we've had from Flybe in a long time - i.e. with no large adjustments, or exceptional items. The airline has been dealing with big legacy problems for a while now, but seems to be emerging in better shape - with the loss-making Finnish operation now disposed of, and the surplus planes beginning to earn their keep (although it's not yet known how successful new routes will be).

Turnover rose 10.3% to £339.6m, which is for only six months remember, so it's a sizeable business.

Profit before tax rose dramatically, from a loss of £3.3m last time, to a profit of £22.9m in H1 this time. There is some seasonality, so H1 is a lot more profitable than H2. A full year profit of £5.2m is forecast by one broker.

A broker note I'm reading this morning says that the results were in line with their forecast.

It's difficult to value, as it's a turnaround situation, and next year's forecasts will benefit from reduced surplus aircraft costs, so the direction of travel for profits should be upwards.

Balance sheet - is particularly strong, with £164.8m net tangible assets, and a decent net cash position of £86.3m.

Dividends - it doesn't pay any, but is expected to rejoin the dividend list, in a modest way this year.

My opinion - the investment case is all about looking beyond the current year, and what turnaround progress might be made in future. It seems to me that this business is on the mend, but it's difficult to value at this stage.

I'm minded to hold for maybe another year, and see where things get to. I very much like the balance sheet strength - once again this company has demonstrated the point that companies with balance sheet strength have time on their side, in that problems can be fixed without worrying about solvency, or…

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