Virgin Atlantic posts £80.2-mn loss
04 Aug 2012
Hit by surging fuel costs and rising taxes, Virgin Atlantic has posted a loss of £80.2 million.
The airline founded by Sir Richard Branson said passenger numbers grew 2 per cent to 5.4 million in the year to February even in "an incredibly difficult market", after it introduced a new route between Manchester and Las Vegas and added frequent flights to the Caribbean.
However, the long-haul carrier ended up in the red, as against a profit of £18.5 million the previous year, as it struggled to pass on "sky high" fuel prices, which rose an average of 32 per cent in the year.
This became more difficult with increasing air passenger duty - a so-called green tax on aviation - which further pushed up the cost of flying and Virgin said its fees through the duty were up 25 per cent to £195 million in the year.
This is believed to be only the third instance in the airline's 28-year history that it had slipped into the red, the last being two years ago when it was hit by the financial crisis.
The Crawley-based group, owned 51-per cent by Virgin Group with the rest owned by Singapore Airlines, said it would shave £50 million off its costs, adding the cost cutting would not impact its 8,500 staff.
