Virgin Australia (VA, Brisbane International) has posted a net loss of AUD315.4 million Australian dollars (USD212.7 million) for the full fiscal year that ended on June 30, its seventh consecutive annual loss, and an underlying pretax loss of AUD71.2 million (USD48 million). The result has prompted it to cut 750 jobs, merge divisions, and review capacity.
The carrier blamed poor demand in Australia and higher fuel costs for the results, with CEO Paul Scurrah commenting during a conference call that cost cuts would enable it to attain a stronger position in future years, Reuters reported. However, costs will continue to rise by a further AUD100 million (USD67.4 million) in the 2020 fiscal year due to fuel and currency exchange losses, he cautioned.
The results were significantly worse than the airline's own guidance forecast in May but were in line with analysts' expectations. A new management team under Scurrah is being put in place this year to review operations, including a new chief financial officer, Keith Neate, who was formerly CFO at Virgin Blue Airlines - as Virgin Australia was previously known - and the rail company Aurizon. John MacLeod, a former executive at Air Canada, is Virgin Australia's new chief commercial officer.
Contracts with lessors, airports, and other suppliers will be combed for further savings, and back-office functions will be merged at Virgin, the LCC Tigerair Australia, and Virgin Australia Regional, Scurrah said.
