Virgin Australia has hit after tax profit.
Today the airline reported statutory after tax profit of $1.7 million for the September quarter, an improvement of $60.7 million.
Underlying profit before tax was $8.5 million, an improvement of $53.5 million.
And the airline says it is on track for a full year profit, its first since 2010.
The return to the profitability for Australia’s second biggest airline comes on the back of an end to the price war with Qantas, bringing better returns for each seat sold, plus cost cutting and lower fuel prices.
Qantas also in back in profit. It posted a full year underlying profit of $975 million, reversing last year’s record $2.8 billion loss.
Virgin is now competing more on service, positioning itself as a Qantas alternative with all its flights now coming with free luggage and food. This puts it in position for a better return per seat.
CEO John Borghetti says the result is a significant turnaround.
“This result reflects our continued success in driving revenue per available seat kilometre and yield growth, while controlling costs,” he says.
“Based on current market conditions, the Virgin Australia group is on track to return to profitability for the 2016 financial year.”
The airline’s Tigerair subsidiary made its first profit in the September quarter. It posted EBIT (Earnings Before Interest and Tax) of $0.4 million for the first quarter, an improvement of $20.2 million.
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