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Profits rise 14% as Virgin Atlantic picks up business travellers

Susie Mesure
Tuesday 31 July 2001 00:00 BST
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Virgin Atlantic, the prize in Sir Richard Branson's portfolio of Virgin companies, bucked the recent weak trend among global airlines to report a 14 per cent jump in full-year profits.

The airline, in which Singapore Airlines took a 49 per cent stake early last year, said the figures were buoyed by passengers trading down from first class on other airlines to Virgin's Upper Class seats as companies reined in spending. This was in spite of signs of an economic slowdown in the US that has impacted on the transatlantic market both at home and overseas, particularly for business traffic.

Sir Richard said that despite a tough year the airline had achieved strong yields and load factors. "Market conditions throughout the year were difficult with intense competition, high fuel prices and, in particular, a weak pound," he said.

Virgin Atlantic Airways, the subsidiary which accounts for the bulk of the airline's operations, increased pre-tax profits before exceptionals for the year to 30 April to £45.5m from £40m. Sales rose 20 per cent to £1.5bn.

Virgin, which is the UK's second-largest long-haul carrier, has been expanding its routes in recent years as other airlines have cut back. Last year, it added Las Vegas and Delhi to its routes and increased its flights to San Franciso, Cape Town and Shanghai.

KLM, the Dutch national carrier, issued a profit warning earlier this month, sparking fears that other airlines would follow in its wake.

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