6 Aug 2013

$A110 million loss expected by Virign Australia

7:31 am on 6 August 2013

Virgin Australia expects to report a loss of $A110 million this financial year due to tough competition in the aviation market, restructuring costs and the carbon tax.

The airline, the second-biggest in Australia, says the loss would come in at about $A50 million if restructuring costs from its purchase of regional airline Skywest were excluded.

The ABC reports the company posted a profit of nearly $A23 million in 2012.

In a statement to the share market, Virgin chief executive John Borghetti said he expects the restructure to create higher profits this financial year.

"We now have the right platform in the Australian market to generate sustainable earnings benefits," he said.

"The preliminary results for June and July indicate positive trends in both yield and loads, demonstrating strength and momentum building into 2014 financial year."

Virgin said early results for June and July suggest bookings and capacity are both improving this year.