By Sneha Kumar
Feb 27 (Reuters) – Virgin Australia beat first-half underlying profit estimates on Friday, helped by resilient travel demand and gains from its transformation programme, and said it expects revenue and earnings growth to continue over the next six months.
Australia’s second-biggest airline reported underlying net profit after tax of A$278.7 million ($198.07 million) for the six months ended December 31, beating Visible Alpha’s consensus estimate of A$261.1 million and up from last year’s A$230.9 million.
“Passenger demand remains strong, with consumers continuing to prioritise travel and connectivity, supporting the airlines segment,” said CEO Dave Emerson.
Virgin said strong domestic demand during the holiday season supported its airline business, while its transformation programme delivered more than A$200 million in gross benefits in the half.
The company expects growth in both revenue and underlying EBIT in fiscal 2026 on the back of strong travel demand, Chief Financial Officer Race Strauss said.
The programme, which targets technology upgrades, system modernisation and fleet simplification, is expected to deliver more than A$400 million in benefits in fiscal 2026.
Statutory post-tax profit fell nearly 28% to A$341.1 million, reflecting the absence of last year’s income tax benefit.
On Thursday, larger rival Qantas reported record first-half underlying earnings, but its shares slid 9% as higher costs and softer economy class demand for U.S. travel weighed on international earnings.
Shares of Virgin Australia, which returned to the Australian Stock Exchange in June last year, were up 2.5% in early trade at A$3.230, before reversing to trade 0.6% lower.
($1 = 1.4071 Australian dollars)
(Reporting by Sneha Kumar and Nikita Maria Jino in Bengaluru; Editing by Tasim Zahid)
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