Virgin Australia Holdings (ASX:VAH) reported a smaller loss for the third quarter in an announcement to the ASX on Friday. Underlying loss before tax, including Tigerair Australia, came in at $22.2m, an improvement over the $61m loss from the previous corresponding period. Statutory loss after tax came in at $28.3m, which was an improvement compared to the $74.8m from the previous corresponding period. The company reported positive group yield growth and domestic yield growth. There was also an improved underlying CASK performance, with underlying CASK declining during the previous corresponding period. After reporting a $100m loss in the previous corresponding period, Virgin Australia has posted a $74.8m turnaround. The company attributed the turnaround to improvements in the corporate and government market that helped lift group and domestic yield.
The acquisition of Tigerair was also cited as a contributor to the turnaround. The budget airline posted a $500,000 underlying profit for the quarter and recorded significant growth in passengers and revenue. Virgin Australia Group Chief Financial Officer Sankar Narayan said that results were a sign of a significant year-to-year improvement in performance. “While consumer sentiment remains subdued and the international operating environment continues to be challenged, we are seeing a substantial recovery in our domestic business. We have delivered continued growth in our corporate and government revenue and a significant improvement in the performance of Tigerair Australia,” Mr. Narayan said. Shares of Virgin Australia Holdings are down .5c, or .98 per cent, at 51c per share around 2:05pm on Friday. VAH has advanced 36.49 per cent in the last 12 months and 20.24 so far this year.
Author: Imran Valibhoy
May 01, 2015
Since Joining the firm in 2006, Imran has worked on a range of M&A and Capital Market transactions in the natural resources, mining as well as projects in the renewable energy sector. Prior to joining Wise-owl, Imran worked at Euroz Securities in Perth, aiding in the advisory and valuation of companies in the mining and industrial sectors in Australia. Imran has a Masters in Banking & Finance from City University's Class Business School in London and a Bacheloor degree in Commerce from UWA.