Virgin America Reports 2009 First Quarter Financial Results
Start-up Domestic Airline Reports Steadily Growing Revenue and Lower Unit Costs
San Francisco – June 12, 2009 – Virgin America, the award-winning start-up airline, today reported its financial results for the first quarter of 2009. Despite a challenging economic climate for domestic airlines in the first quarter, the carrier reported improved financial results and steady year over year growth in unit revenue that exceeded its projections.
“Despite the tough economic climate, the traditionally slow travel period, and an almost 70 percent increase in capacity, we saw significant improvements in load factor and unit revenue. We are particularly gratified that this strong year over year performance was achieved in an industry environment in which most carriers generated significant unit revenue declines on large capacity reductions,” said Virgin America President and CEO David Cush. “Our first quarter financial results exceeded our projections and we foresee continued strong revenue growth through the spring and summer. We are confident that our unique business model, coupled with our industry-leading service and amenities, will continue to provide an unrivalled value proposition at a time when consumers are more discerning than ever.”
|First Quarter Reporting Highlights:|
|Operating results: The airline reported a $31.6 million operating loss on revenues of $101 million, a 38 percent improvement year over year.|
|Growing load factors: The airline reported a 73 percent load factor in 1Q09, a 12 point improvement over 2008, despite a 69 percent increase in capacity. Traffic more than doubled year over year. Despite the weak economic environment, load factor increased each month during the quarter, from 68 percent in January to to 71 percent in February to 78 percent in March. This trend continued in the second quarter, when the airline recorded the two highest load factor months in its history – 85 percent in April and 84 percent in May.|
|Significant top line progress: Revenue in 1Q09 was up by 91 percent versus 1Q08. Virgin America’s unit revenue in the first quarter of 2009 was up by 13.2 percent versus the first quarter of 2008.|
|Cash: The airline ended 1Q09 with $38 million in unrestricted cash and $63 million in total liquidity, with full funding for its operation through its projected profitability date.|
|Operating Expenses (000)||132,351||103,652||27.7|
|Operating Income (Loss) (000)||(31,562)||(50,826)||(37.9)|
|Net Income (Loss)||$(40,306)||$(52,014)||(22.5)|
|Load Factor||73.1%||61.0%||12.1 pts|
|Operating Margin %||(31.3%)||(96.2%)||(64.9) pts|
“We’re pleased with our steady progress to date, especially given the challenging economic environment and fuel price volatility since our August 2007 launch. With solid financing, a streamlined cost structure, and an award-winning low-fare service that is injecting healthy competition into new markets, we’re focused on smart growth for the long haul,” added Cush.
In the first quarter, Virgin America expanded its low-fare award-winning service with WiFi-enabled flights to Boston from both Los Angeles and San Francisco. This spring, the carrier also completed its aggressive roll out of the Gogo Inflight Internet service across its fleet and became the first and only airline to offer WiFi on every flight and power outlets under every seat throughout the cabin.
Operationally, Virgin America continues to excel, achieving an impressive 83.1 percent A-14 on-time performance for the first quarter. The carrier’s mishandled baggage rate was also industry-leading in the first quarter, with an average of 1.46 bags per 1000 guests, versus the industry average of 4.29 bags per 1000 guests.
Although a privately held company, the airline is announcing these earnings results in advance of the U.S. Department of Transportation’s (DOT) quarterly reports.
Virgin America is one of the fastest growing U.S. carriers of all time, with a new fleet and 100 daily flights from: SFO to LAX, SFO to JFK, SFO to SAN, SFO to IAD, SFO to LAS, LAX to JFK, LAX to IAD, SFO to SEA, SEA to LAX, JFK to LAS, BOS to LAX, BOS to SFO and SFO to SNA.
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Media Contact: Abby Lunardini (650) 533-7576 / email@example.com
EDITORS NOTE: Virgin America is a U.S. controlled and operated airline and an entirely separate company from Virgin Atlantic. Sir Richard Branson’s Virgin Group is a minority share investor in Virgin America.
About Virgin America: Launched in August 2007, Virgin America offers guests attractive fares and a host of innovative features aimed at reinventing air travel. Virgin America’s base of operations is San Francisco International Airport’s modern International Terminal. The airline’s new Airbus A320-family aircraft offer interactive in-flight entertainment systems and power outlets near every seat for electronic gear. Virgin America offers in-flight internet service on every flight and hosts the largest in-flight entertainment library in the domestic skies via its touch-screen Red™ seatback system. In addition to a 25-film library including Oscar winners, foreign language films and Hollywood blockbusters, Red features live TV, videogames, seat-to-seat chat, 3,000 MP3s, music videos and more. In addition to a Main Cabin that offers custom-designed leather seats with a deeper, more comfortable pitch, Virgin America’s First Class features international-grade amenities, including seats with 55 inches of pitch and lumbar massagers. The carrier’s Main Cabin Select service offers 38-inches of seat pitch, complimentary food and cocktails, an all-access pass to Red™ and priority check-in and boarding. For more: www.virginamerica.com