Virgin Atlantic books another loss as consumer uncertainty weighs
Virgin Atlantic has posted its second consecutive year in the red as the airline was hit by the Brexit-hit pound, economic uncertainty and engine woes.
The carrier – founded by Sir Richard Branson – posted a statutory loss of £38.9 million in the year to December 31, which compares to £65.5 million in 2017.
Stripping out exceptional items, the firm posted a £26.1 million loss.
Its performance was dragged down by “softer consumer demand” linked to economic uncertainty and the weakness of the pound versus the dollar following the Brexit vote, which has knocked demand from UK travellers.
As well as sterling woes, the group was impacted further by faults with Rolls-Royce Trent 1000 engine parts, which led to some of its Boeing 787 Dreamliners being grounded.
The issue has impacted upon a raft of airlines, including British Airways.
Chief executive Shai Weiss said: “While a loss is disappointing, our performance has improved in 2018 despite challenging economic conditions and put us on a trajectory for growth and return to profitability.
“And, the acquisition of Flybe will secure the future of Europe’s largest regional airline, extending the Virgin Atlantic experience and delivering more choice for customers connecting from the UK and Europe on to our long haul network.”
As part of the Connect Airways consortium, Virgin recently bought Flybe.
Total revenue at Virgin increased 5.8% to £2.8 billion in the period, which included Virgin’s first positive passenger unit growth since 2014 at 1.7%.
The firm booked a 4.8% growth in passenger numbers to 5.4 million.
Virgin Atlantic is 49% owned by Delta, 20% by Sir Richard’s Virgin Group with Air France-KLM holding 30%.