VIRGIN NARROWS LOSS WITH COST CUTS
29 July 2015,
VIRGIN Australia Holdings (ASX:VAH) has tapered its underlying loss before tax to $36.9 million in the fourth quarter, as Tigerair's performance starts to take off.
The result represents a $46.2 million improvement since the previous corresponding period, or $72 million including Tigerair on a like-for-like basis.
For the financial year-to-date ending 30 June 2015, the underlying loss before tax sits at $49 million a $213 million improvement over the previous year.
Tigerair recorded a pre-tax underlying loss of $9.8 million in the fourth quarter, compared to $25.8 million previously.
The airline incurred restructuring and transaction costs and the impact of ineffective hedges of $24.9 million.
Virgin Australia Group CFO Sankar Narayan says the company's cost reduction program continues to deliver positive results.
"The result represents a significant year-on-year improvement in performance for the seasonally weaker June quarter and we expect to see a continued positive trajectory," Narayan says.
"The key highlights in this result have been our performance on non-fuel costs, success in attracting high yielding market segments and the improved performance of Tigerair Australia."
He says underlying cost per available seat kilometre continues to decrease, excluding fuel costs.
Virgin's fourth quarter group yield and domestic yield were also up compared to the previous quarter.