V-Flyer

PA story

VS has announced that it made a big operating loss last year but that revenues and passenger numbers rose in the first part of this year.
Virgin's group pre-tax operating loss for the period March 2009 to February 2010 was £132 million, compared with a profit of £60 million for March 2008 to February 2009.

I may be a bit too cynical, but I always read Virgin accounting reports in the same light as party political manifestos. :w

There is an awful lot of information that isn't in them, and they will never tell the full story.

Nick

It does make one wonder just how bad things would be if it were not for the BA Strike and XL leisure collapse.

The Ash problems form only a small part of the losses.
Capacity factor is up, UC up, many costs visibly down
Prices up.
So why the loss?

Bill S wrote:So why the loss?

Management bonuses? :w

Surely not? ! :0

Nick

We have discussed at length the increasing number of unpopular cuts VS have made to the service, and the fact many of them have upset regular pax to the point that their loyalty is tested. Perhaps this is now begining to show in the figures?

Ash problems are after February 2010 though?

I see that Ridgeway claims " we have delivered a new brand indentity". I must have missed that. Personally, I would rather have better service/lower prices.

Interesting - That PA story has been heavily cut in the last few minutes.

The VS press release is here.

The overall revenue growth has been achieved despite the impact of the ash cloud effect in April – the airline estimates that the customer compensation and operational cost will total £30 million.

2010/11 Quarter (March to May)

Total airline revenue up 10% to £513m
Passenger load factor up 5% points to 82%
Business class market share increased by 5% with 15% additional Upper Class passengers
New Accra route launched in May 2010 reaching 77% load factor
Cargo revenue up 36% to £52m

2009/10 Full Year Performance

Revenues decreased by 8.6% to £2,356.6m
Group pre-tax operating loss of £132m
Airline operating costs reduced by 8%
Improved cash position of £450.5m
Virgin Holidays delivered profit of £24m

So the losses were revenue losses despite substantial increase in load factor

Bill S wrote:So why the loss?

Erm revenue down 8.6% probably accounts for a lot of that :w .

Not to bad compared to BA though where revenue was down 11%.

We shall never know with any real transparency what went into and came out of VS figures - we can only assume that they're comparable to other airlines (albeit that those don't pay millions in licensing the Virgin brand from SRB, though many will have other 'management' fees). So we have to take them as read, revenue down, costs down not by as much, loss widens and other factors hideen!

Bill S wrote: The overall revenue growth has been achieved despite the impact of the ash cloud effect in April – the airline estimates that the customer compensation and operational cost will total £30 million.

2010/11 Quarter (March to May)

Total airline revenue up 10% to £513m
Passenger load factor up 5% points to 82%
Business class market share increased by 5% with 15% additional Upper Class passengers
New Accra route launched in May 2010 reaching 77% load factor
Cargo revenue up 36% to £52m

2009/10 Full Year Performance

Revenues decreased by 8.6% to £2,356.6m
Group pre-tax operating loss of £132m
Airline operating costs reduced by 8%
Improved cash position of £450.5m
Virgin Holidays delivered profit of £24m

So the losses were revenue losses despite substantial increase in load factor

I read this differently. The losses are for full year March 2009 to Feb 2010 when revenue was down; the increases in the load factor and revenue are for March to May 2010. I've seen no mention of profit or loss for that period.

Paul

Of course - you're right Paul.
Confusing releasing the 2009-10 figures then talking about 2010-11 first quarter!
Guess that might be why the PA article has been re-issued.

I wonder how much of the ash £30m loss was in that quarter and how much is estimated for next.

To get a better picture of the VS figures check out what Singapore Airlines release regarding their partner costs. When they released their figures the other year it showed VS making a loss compared to what VS released to the public domain, mainly due to IFRS vs UK GAAP differences IIRC.