Virgin Australia is in the black for the first time in more than a decade, reporting a statutory net profit after tax of $129 million for the 2022/23 financial year (FY23).
Reflecting a 124 per cent increase in yearly total transaction value (TTV), Virgin Australia reported group revenue of $5 billion in FY23 for a $439 million EBIT (earnings before interest and tax).
Its airline business, which includes domestic, international, regional and charter services, recorded $4.87 billion in revenue, reflecting a 126 per cent year-on-year increase. Underlying EBIT for the airline business totalled $362 million.
Meanwhile, revenue for loyalty program Velocity rose by 68 per cent to $330 million on the back of a record 11.5 million members. Underlying EBIT for Velocity was $77 million.
The company put its positive year largely down to increased consumer demand following COVID-19, including record travel demand for leisure, pre-pandemic levels of SME travel business and a return of corporate travel.
Its success also comes at a time of higher fuel prices and cost-of-living increases as consumers continue to prioritise travel.
Transforming an airline
Virgin Australia CEO Jayne Hrdlicka said the results marked “an important milestone” for the company.
“It has been 11 years since Virgin Australia returned a profit, and our results signal that the transformation of Virgin Australia is progressing well,” she remarked.
“We have a long-term commitment to transformation and are only part-way through this multi-year journey.
“By creating a systemically lower cost base and a conservative balance sheet as well as investing heavily in technology and our frontline, we are well positioned for the future.”
Specifically, Hrdlicka flagged an investment in the company’s “frontline transformation” to enhance the customer experience as well as the recently announced $110m cabin upgrade, new 737-800 aircraft, bag-tracking app and Rapid Rebook technology.
“Value and choice are core to our business and as the continuing rise in cost-of-living impacts household budgets, we believe we are well positioned to continue to provide customers with the best value in the market,” she added.
Virgin Australia CFO Race Strauss said, “Our balance sheet is now considerably stronger and the cost base of the business has significantly improved from recent years”.
“Virgin Australia is now in a very strong capital position, with total debt including leases now $2.3 billion and over $1 billion of cash on balance sheet, providing the platform for future investment in transformation and growth.”
Among the carrier’s big developments this year, was the launch of VA’s first-ever non-stop flights to Japan.
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