Only a few days after British Airways announced a £410m pre-tax loss for the year to March, its worst result since privatisation, Sir Richard Branson's VirginAtlantic had some good news. The 25-year-old airline's pre-tax profit in the year to February almost doubled, growing from £35m last year to £68m.
Branson "has lost none of his touch for public relations", said Ian King in The Times. The results were released two months earlier than usual, suggesting that they were timed "to embarrass the old enemy". As for the figures, look beyond the press release and there is "cause for scepticism": last year's figure was after exceptional items, while this year's wasn't. Factor that in and the profit rise is "much less dramatic". Still, one plus point for the airline is that it clearly got its fuel hedging right something that BA "palpably failed" to do.
Virgin seems to be gaining some market share from BA, said Nils Pratley in The Guardian, while its greater exposure to leisure travellers, a sector holding up comparatively well, also helps. Virgin is less reliant on business travellers than BA, whose dependence on "bankers and financial types criss-crossing the Atlantic has been brutally exposed". These passengers make up 11% of the total but contribute 40% of BA's revenue. No major airline will make money this year, as Virgin itself has pointed out, but it certainly looks in better shape than BA.
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