Virgin, Air NZ results hit by external events
Virgin Australia has announced a $68 million annual loss due to the effects of natural disasters, higher fuel prices and a meltdown of its reservation system late last year.
The loss of $68 million for the year to June, compared with a $21 million profit a year earlier.
The bottom-line result includes $36 million in unrealised foreign exchange losses due to a stronger Australian dollar. Total revenue rose 10 percent to almost $3.3 billion.
Virgin’s chief executive, John Borghetti, said the loss reflected the impact of an ‘‘unprecedented series of external events’’ and reinforced the need for it to pursue its plan to take the airline up-market.
International operations recorded a profit of $22 million, compared with a loss of $25 million previously.
Across the Tasman, Air New Zealand has reported second half losses due to earthquakes in Christchurch and Japan and high fuel prices.
Net profit of NZ$81 million ($66.9 million) for the year ended June 30, compared with NZ$82 million last year.
The airline said it had gained market share and increased load factors on the highly competitive routes between New Zealand and Australia. However, long haul international travel was difficult and a loss maker.
“This has seen long haul routes in our network lose more than NZ$1 million a week in the first six months of this calendar year,” said chief executive Rob Fyfe, adding the carrier would look at routes and aircraft being used to cut costs.
Ian Jarrett
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