Virgin Australia Holdings Limited (VAH) has announced (03-Feb-2017) an Underlying Profit Before Tax result of AUD45.9 million in Q2 – 2016-2017.
The result is down AUD27.1 million (-37.1%) from the AUD73 million result delivered in the prior corresponding period, year-on-year.
In its statement to the Australian Stock Exchange, the company attributed to fall to “subdued industry trading conditions in the domestic market [which] continued to adversely impact revenue during the second quarter” resulting in a capacity reduction of 5% in the airline’s domestic business.
Sydney and Melbourne traffic positive while Brisbane and Perth fall
Domestic passenger traffic growth out of the major east coast hubs Sydney and Melbourne remained at or close to long term averages in Q2 2016/2017, but Brisbane and Perth airports didn’t fare as well.
Overall, domestic traffic is up with the latest figures released by Australia’s Bureau of Infrastructure, Transport and Regional Economics (BITRE) showing a 2.5% increase in domestic passenger numbers Jan- Nov-2016 year-on year.
The main east coast trunk routes have shown positive, if not impressive, passenger growth in 2016. Melbourne-Sydney remained Australia’s busiest route with Nov-2016 traffic up 4.2% on the corresponding period in 2015. Brisbane-Sydney traffic was up 1.3% with Brisbane- Melbourne also up 2.8% for the same period.
Sydney Airport, Australia’s busiest, saw domestic traffic rise overall in Q2 – 2016/2017. Dec-2016 saw a rise of 1% year-on year. Nov-2016 was higher at 3.2% with Oct-2016 at 1.4%. Overall 2016 domestic traffic out of Sydney was up 3.8% year-on-year. Similarly, Melbourne Airport reported 2.1% growth year-on-year for 2016.
The picture has been less positive for Perth Airport whose domestic traffic fell for all three consecutive months in Q2 – 2016/2017. Oct-2016 recorded a fall (-5.6%) year-on-year with Nov-2016 (-1.9%) and Dec-2016 (-3.4%) also down.
Brisbane Airport also reported a fall in domestic traffic in Q2-2016/2017 with Oct-2016 (-0.8%) and Nov-2016 (-0.6%) both in negative territory. Dec-2016 was slightly up though (+0.1).
The VAH share price closed on 3-Feb-2016 at AUD0.20, down 4.65%.