Business travellers lift profits at Virgin Atlantic
Published: 27 Aug 2008
Virgin Atlantic Airways Ltd. has stated that a record number of business travelers sent annual pretax profits before one-off items up 38 percent.
The company reported a pretax profit for the 2007-2008 financial year of 60.9 million pounds ($112.2 million), up from 44 million pounds a year earlier.
The result for the year ended February 29 excluded a 32 million pound ($59 million) charge relating to the settlement of a class action lawsuit over the price-fixing of fuel surcharges. Virgin and rival airline British Airways PLC admitted to colluding over fuel surcharges on long-haul flights between August 2004 and January 2006.
Virgin said it benefited from increasing numbers of premium fliers into the first quarter of this year as passengers shunned British Airways to avoid teething troubles at Heathrow's new Terminal 5, which BA uses.
"It's ironic that just as regulators are breaking up one monopoly -- BAA -- British Airways and American Airlines are trying to create another. Our results prove that consumers want choice on transatlantic routes," Virgin Atlantic President Richard Branson said in a statement, referring to the request from a UK regulator for BAA to sell two of the three London-area airports.
A BA spokesman said: "We do not recognise Virgin's claims to be taking business from us on the grounds that passengers do not like Terminal 5. Up to 65,000 passengers a day are now using Terminal 5, a number that has risen steadily from 40,000 a day in April. Passengers are extremely happy with Terminal 5, which is working well and provides an experience vastly superior to the rest of Heathrow. It is not surprising if other airlines are envious."
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