Virgin Australia on route for profitable 2017

paper plane made from a ten dollar bill

While Virgin Australia posted a hefty $225 million full-year loss last week after restructuring its business and fleet, the airline is eyeing a profitable 2017.

The loss was actually less than that in 2015, with overall group revenue increased 5.7 percent to $5.02 billion, meaning the airline is on the rise.

Virgin Australia chief executive John Borghetti says it is a “fair assumption” that the airline will return to profitability this year given all of its divisions are now making money – except for international which will return to the black this year.

Virgin Australia has focused for years, heavy spending in order to break Qantas’s near monopoly on the domestic market.

The airline has targeted the corporate and business realm, and now claims 30 percent of the lucrative government and corporate market with a strong product offering.

Since Air New Zealand left the party, Virgin has had no trouble attracting new investors – including China’s HNA Group and Nanshan Group and the long-term plan now is to grow revenues by expanding into China through this partnership. However Virgin flights to China are unlikely to start operating until the second half of calendar 2017, which means benefits from that alliance will start flowing through in the 2018 financial year results.

Email the Travel Weekly team at traveldesk@travelweekly.com.au

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