Virgin Blue Profitable

Submitted by Share Trading on 25 February, 2010 - 07:50

Budget airline carrier Virgin Blue (VBA) posted a better than expected profit for the first half of the financial year, reporting a net profit of $62.5 million (compared to the corresponding period in 2008 where VBA lost $101 million). No interim dividends for Virgin Blue. Virgin Blue’s long haul spin off is close to breaking even, losing $39 million in the first half, but the CEO, Brett Godfrey, is confident it will be profitable by August (only 18 months after the airline was launched). He noted the aircraft is now running at more than 80 percent full but, ''Yields, however, are still weak.''

Also, Virgin Blue was short listed for a federal government tender for almost a third of its air travel budget over the next two years worth $500 million. Qantas has had this particular tender for many years. However the CEO cautioned that the second half earnings may not be as strong as the first half. Brett Godfrey will be leaving and the board of directors of VBA have short listed three candidates to take over the CEO position.