Virgin Australia Current Economic Activity And Future Implications

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Virgin Australia current economic activity and future implications Virgin Australia is a rival airline to Qantas. Virgin Australia started in the aviation industry in the year 2000. The current position of the airline is better than the previous financial year of 2014. This report will focus on current financial results and position, the capacity, network and pricing, current equity structure and future direction. The loss before tax has been minimised by $162.7 million to $49.0 million. Furthermore, return on invested capital has improved to 6.1% in contrast to 1.4% the year before. Virgin Australia domestic improved on their earnings before tax and interest from financial year 2014. This trend is said to echo in the future leading to…show more content…
This provides Virgin Australia with a positive outlook of the future. The international sector of Virgin Australia during financial year 2015 was not so forgiving with a loss of $68.9 million. This was $22.8 million worse than the previous year. The domestic sector has improved greatly however the international sector has fallen into a loss larger than the previous year. Virgin Australia international improved by $2.4 million after making some minor changes to international business class. The operating cash flow of $218 million has improved by $226 million from previous year. Moreover, domestic unit revenue has improved by 3.5%, cost savings target for financial year 2017 has increased by $0.2 billion from financial year 2014. The closing cash balance of $1.03 billion signifies the improvement from financial year 2014. Yield has grown by 5.2% over the past financial year. The outlook statement, as quoted directly from the ASX Virgin Australia Financial year 2015 Results Presentation, states that “based on current market conditions, all fundamental business metrics are on track for the Group to return to profitability and report a Return on Invested Capital in line with its cost of capital for the 2016 financial year.” Virgin Australia is planning to improve their fleet and meet customer’s needs by improving their international network. For financial year 2014 the total revenue was $4306.6 million,
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