Emirates has signed a codeshare agreement with Exeter-based Flybe, Europe’s largest regional airline.

The news comes as Flybe reports a £35.6 million pre-tax loss for financial 2014, having seen a profit of £8.1 million a year earlier.

The losses were largely down to a one-off charge linked to its exit from a joint venture in Finland.

Having released a profit warning in January, the group’s chief executive Saad Hammad today said the group had been operating in a “more challenging environment than anticipated”.

The group also reported a 7.5 per cent fall in annual revenue to £574.1 million.

However, the Emirates deal has the potential to transform the airline.

It is designed to open up new destinations for Flybe and Emirates passengers across the UK.

The new agreement will see Emirates’ code added to 25 Flybe routes across the UK, adding a total of 13 new destinations to the Emirates global network and seamlessly connecting customers to new cities such as Edinburgh, Aberdeen, Guernsey, Isle of Man, Jersey and Newquay.

All Flybe flights will seamlessly connect with Emirates flights to Dubai and beyond flying from its Manchester, Glasgow and Birmingham gateways.

Emirates and Flybe are currently targeting a July launch for the new codeshare.

Thierry Antinori, Emirates executive vice president said: “Our new codeshare agreement with Flybe will provide our passengers with increased choice, flexibility and ease of connection to different cities within the UK to and from Dubai, ultimately offering a smoother, more convenient travel experience.

“Emirates already offers 16 daily services from the UK to Dubai with another daily service flying from Birmingham from the beginning of August.

“Together with Flybe, we are taking more people to more places and opening up new UK destinations to people around the world.

“It’s an important partnership as we continue to expand the destinations available to Emirates’ passengers.”

Flybe operates over 180 routes to 72 European airports.

Emirates customers travelling on Flybe will enjoy the same luggage allowance they are entitled to on Emirates checked through to their final destination.

All Emirates’ passengers on Flybe flights will receive boarding passes on check-in at their first international departure point for connecting international services.

Emirates currently has codeshare agreements in place with 14 partners around the world including; Qantas, Jetstar and Jet Blue among others.