Virgin maintains guidance
Market watch top headlines
Virgin Australia expects to improve its underlying financial performance in the 2012/13 financial year, but uncertain economic conditions have stopped it from providing more detail.
Chief executive John Borghetti on Tuesday said the company's guidance for the year to June 30, 2013, had not changed since the beginning of the year.
"We maintain the same guidance we provided at our financial results in August of eight to nine per cent domestic capacity growth in the first half of the 2013 financial year," he told the airline's annual general meeting in Brisbane.
"While Virgin Australia currently anticipates an improved underlying profit before tax in financial year 2013 compared to Financial Year 2012, excluding the impact of the proposed Skywest and Tiger acquisitions, the uncertainty in economic conditions and the particularly competitive environment precludes us from providing a profit guidance for the year."
Virgin made an underlying pre-tax profit of $82.5 million in the 2011/12 financial year.
Its net profit in the same period was $22.8 million, and the recent Tiger and Skywest deals are likely to impact net profit in the 2012/13 year.
Virgin plans to buy a 60 per cent stake in budget carrier Tiger for $35 million, and has made a $98.7 million bid for Skywest.
Mr Borghetti said the airline's transformation plans had progressed faster than expected in the 2011/12 financial year, and the next phase of the program had begun.
The Tiger and Skywest deals form a key part of that plan, he said.
Chairman Neil Chatfield told shareholders the strong competition in the domestic market was set to continue, but Virgin's plans put it in a good position to manage that environment.