Virgin Blue reports 92.9% increase in Net Profit

Virgin Blue Holdings has reported a net profit after tax of A$216 million for the year ended 30 June, 2007, a 92.9% improvement on the previous year. Earnings per share increased 92.5% from 10.7 to 20.6 cents as the airline maintained its traditional leisure market and attracted new business from the corporate sector and frequent fliers, contributing to a 16.3% improvement in revenue on 2.9% increase in production. 

Net profit before a series of one-off expenses was A$232 million. During the period under review Virgin Blue incurred A$23 million of non-recurring pre-tax costs associated with preparations for items including its long haul international airline V Australia, the 20 Embraer E-Jet domestic growth project and the write-off related to cancellation of the reservations project.

“This result is a credit to our outstanding and dedicated team. It is the strong performance we were aiming for, and progress at the rate planned under our New World Carrier strategy,“ said Virgin Blue Chief Executive Brett Godfrey.

In recognition of the performance of the business, the Board approved a discretionary A$7.1 million profit share to the 4000 team members, who provided customer service to a record number of passengers.

The next 12 months will be a period of steady expansion for Virgin Blue Airlines as the three airline group enters the New Zealand domestic market for the first time, expands its Australian domestic network, continues product development and launches a fourth airline, V Australia to undertake long haul international operations.

Virgin Blue has signalled its intention to engineer a significant capacity increase over the next 18 months to accommodate growth combined with increased operational efficiency achievable by a mixed Embraer/Boeing fleet.

 The airline group which now comprises Virgin Blue, Pacific Blue and Polynesian Blue, will take delivery of the first of 20 Embraer E-170 and E-190 aircraft. The company has also leased two737-800’s to enter service in Q4 of this calendar year, retained two leased Boeing 737 aircraft due for return in 2007 and will purchase a further four 737-800 for delivery in FY08.

Product development will include enhancements to the Velocity Loyalty programme, a new Canberra Lounge, continued installation of live2air seatback television and expansion of Sydney Airport facilities.

Preparations for the launch of trans-Pacific operations will escalate and subject to completion of the remaining regulatory requirements, V Australia will inaugurate Boeing 777-300ER international flights to the USA in the second half of 2008.

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