Virgin Australia now expecting losses of more than $35 million for FY19.
Virgin Australia has just issued new earnings guidance for the 2019 financial year, saying its underlying profit is expected to be at least $100 million down on last year’s $64.4 million result – meaning a loss of $35.6 million at best.
The carrier cited “the uncertainty of revenue trading conditions in the domestic market,” along with annual fuel and foreign exchange headwinds in excess of $160 million.
“Demand has weakened in both the corporate and leisure sectors, driven by lower levels of consumer and business confidence, consumer spending and the impact of the Federal Election,”according to a statement issued by the carrier.
A network review had been initiated in response, with some immediate adjustments in capacity and frequency to better align with demand conditions.
“While we have continued to grow revenue, this announcement shows that our business needs to become more resilient to challenges such as weaker demand, high fuel prices and the foreign exchange environment,” said CEO Paul Scurrah.
More details in today’s issue of Travel Daily.