Virgin Australia returns to profitability

Virgin Australia has returned to profitability for the first time in 11 years, reporting statutory NPAT of AU$129 million. Revenue more than doubled compared to the prior year to AU$5 billion as the company responded strongly to increased customer demand following COVID-19. Underlying EBIT was AU$439 million, representing a margin of 8.8%.

Virgin Australia's Airline business (which includes domestic, international, regional and charter flying) recorded revenue of AU$4,873 million, an increase of 126% due to increased flying activity. Underlying EBIT was AU$362 million, a margin of 7.4%.

Loyalty business Velocity recorded revenue of AU$330 million, an increase of 68%, with strong member growth through the year, reaching a record 11.5 million members. Underlying EBIT of AU$77 million represented a margin of 23.4%.

Record travel demand for leisure and the return of SME customers to pre-COVID levels alongside a slower but important return of corporate travellers, enabled significant revenue recovery. Efficiency initiatives delivered a significant increase in profitability in spite of higher fuel prices. Virgin Australia has continued to see healthy demand as customers prioritise travel in the face of cost-of-living pressure.

Virgin Australia's CEO Jayne Hrdlicka commented: “These results are an important milestone for Virgin Australia. It has been 11 years since Virgin Australia returned a profit and our results signal that the transformation of Virgin Australia is progressing well. We have a long-term commitment to transformation and are only part-way through this multi-year journey. By creating a systemically lower cost base and a conservative balance sheet as well as investing heavily in technology and our frontline, we are well positioned for the future.”

She added: “Our investment in frontline transformation continues and is designed to boost capability, customer experience and operational efficiency. Our recent announcement of a AU$110 million cabin upgrade, arrival of the first of our new Boeing 737-8 aircraft, market leading baggage tracking app and Rapid Rebook technology launch all help us to create experiences our guests love.” (£1.00 = AU$1.91 at time of publication).