Scottish airline Loganair has returned to profitability as its owners seek to find a buyer for the Glasgow-based business.

Accounts released today show Loganair made a pre-tax profit of £5 million during the 12 months to the end of March – its 60th year in operation – on revenues of £161.7m. That came after two successive years of losses triggered by the Covid pandemic which brought much of the airline industry to a standstill.

Loganair announced earlier this month that its owners, brothers Stephen and Peter Bond, are looking to sell the business so they may retire. The pair have been involved in the business for 25 years, including the last 10 years as sole owners.

Chief executive Jonathan Hinkles said it will likely be “well into next year” before a deal is done, as Loganair opted to share news of the impending sale at an early stage in the process.

“Because we have taken that pro-active step of saying very early what it is we are going to do, and we haven’t actually done it yet, it means there will be quite a gap before there is any further news or update,” he said.

The Herald: Loganair has imposed a surcharge to deal with rising fuel costsLoganair has imposed a surcharge to deal with rising fuel costs (Image: Loganair)

Following the collapse of Flybe in March 2020, Loganair has expanded beyond its traditional Scottish heartlands to become the UK’s largest regional airline with a fleet of 42 aircraft operating across more than 70 scheduled routes within the UK and to Ireland, Denmark and Norway. It has a long-running partnership with British Airways and has more recently signed agreements to provide connecting flights on behalf of Singapore Airlines, Finnair and Ethiopian Airlines.

Mr Hinkles highlighted the contribution from the company’s contract and charter businesses, which account for eight of its aircraft and about 20 per cent of group turnover. Services include flying offshore workers out of Aberdeen for oil and gas companies, and providing flights to an expanded roster of eight Premier League football teams.

On the contract side, Loganair has signed a new five-year agreement to provide air services to the Highlands and Islands for Royal Mail. Activity across both contract and charter operations is expected to grow in the current year.

“It is certainly a very, very active part of Loganair’s business and one where we see potential for further growth,” Mr Hinkles said.

Loganair carried 910,000 passengers during the year to March, up from 204,184 in the previous 12 months. Load factor – the number of bums in seats – rose to 47.2% amid fluctuating demand as lockdown and other restrictions “drifted in and out”, only coming to a complete end six months ago.

READ MORE: Bond brothers' Glasgow airline Loganair for sale

“Load factors so far for this year are back up into the mid- to high 60s across the route network, which for a regional airline with a mix of routes such as ours is at or maybe even slightly higher than where we historically would be,” Mr Hinkles said.

He added that the company carried more than 150,000 and 140,000 customers in July and August of this year, which was above the same equivalent periods prior to the pandemic: “That is a reflection of operating larger aircraft and of course we picked up a number of routes that we weren’t flying before ethe pandemic following the bankruptcy of Flybe.”

Loganair imposed a flat fuel surcharge of £3.95 each way in March of this year to help offset the impact of surging inflation. The fee structure has since been refined to £3.95 for a mid-length flight, about half of that for a short journey, and £5.95 for longer flights such as those to Denmark.

“There is no doubt that there are cost increases across pretty much everything you look at, and that along with the impact of the weaker dollar exchange rate against sterling, is an issue for the whole industry, but we are confident with the early actions that we have taken that we are in a good place to withstand that,” Mr Hinkles said.