Privately-owned airline Flybe has hit back at British Airways after the 15 percent shareholder wrote down the value of its stake in the low-cost carrier by around 25 percent.
Flybe said on Wednesday it disagreed with the decision, arguing that its regional airport business model was robust and it would make a pretax profit for the year to March 2010.
"Flybe notes with surprise that British Airways have chosen to impair the value … Flybe believes that the decision is principally based on BA's view of their own performance and prospects rather than an analytical view of Flybe's track record and future prospects," it said.
British Airways said in its results last week it has written off around 25 percent of the value of its stake in Flybe after reviewing the carrier's prospects.
BA, which posted record losses for 2009/10, said it had cut 13 million pounds ($20.84 million) from the value of the 15 percent investment, acquired as part of the sale of its regional arm BA Connect to Flybe in 2006.
BA now values the stake at 30 million pounds, implying a full value for Flybe of 200 million pounds.
"Despite a growth in Flybe's revenue and an expected reporting of profits for the year ended March 31, 2009, the review (of the investment) showed a further decline in fair value, associated with a lower rate of forecast revenue and earnings growth than previously expected," the carrier said in a statement.