Virgin returns to profit
Virgin Atlantic is to invest £100 million in product development after reporting a strong year of trading and a return to profit.
Its full-year pre-tax profit was £18.5 million, compared to a loss of £132 million a year ago.
Meanwhile, 2010/11 revenues were up 13% to £2.7 billion with load factors of 82%.
Despite the winter closure of London Heathrow and the ash cloud crisis costing the business a combined £40 million, the airline said strong growth in business traffic and solid load factors across all cabins delivered a good recovery.
The performance of its tour operator business, Virgin Holidays, was also driven by high demand for its core Orlando and Caribbean holidays.
The operator is doubling its UK retail network to 120 stores, creating 200 jobs nationwide.
Chief executive Steve Ridgway said: “We have demonstrated the resilience of our business by weathering the toughest economic period for aviation and have now returned the business to profit.
“A sharp recovery in the first half of the year has been tempered by more challenged trading in the latter period due to increased capacity in the market and high fuel prices.
“Since the turn of the year, market conditions have become tougher with increased capacity, faltering consumer confidence and high fuel prices.
“We are also seeing softer trading in the areas that are hit hardest by the continued rises in Air Passenger Duty, particularly the Caribbean routes and Premium Economy cabins. Whilst business traffic remains strong, demand in the economy cabin is more challenged.â€
by Bev Fearis
Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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