It's not just Qantas which is doing well among our airlines.
Virgin Blue is booming, with strong gains in passenger numbers, revenues and earnings and upgrades, and yesterday it was the turn of major regional operator, Rex, to confirm that the industry is indeed in a very sweet spot, to use the current buzz word in the industry.
In fact the Rex story helps blow a further hole in the stance of Qantas management during the failed APA offer.
It said yesterday that it now expects a 40 per cent rise in full year net profit for the 2007 financial year. The airline reported net after tax earnings of $15.7 million. That would push past $22 million if the 40 per cent guidance is met.
The company said that third quarter net earnings jumped 107 per cent to $5.6 million, from $2.7 million in the same quarter of the 2006 year.
The company said that as a result, group profit after tax for the nine months to the end of March was $17.3 million, up 51.8 per cent on the previous corresponding period and of course more than for all of 2005-2006.
That saw the shares leap 39c to a record $2.785 on big turnover of more than 360,000 shares (for the stock).
The result has been boosted by rising passenger numbers, a 13 per cent or so increase in fuel costs, which is much less than experienced last year and the continuation of fuel surcharges (which is also helping Qantas).
Rex said group revenue had risen 20.6 per cent to $153.3 million, while the number of passengers carried grew 19.8 per cent to 1.045 million. Obviously the impact of the drought hasnot been theproblemit was in the 2006 year.
Rex also announced it would bring forward its purchase of the remaining 25 per cent of Pel Air Aviation Pty Ltd to June 30. The $6 million purchase was originally scheduled for November.
It will be funded by Rex shares in line with a put and call option deed agreed to by Rex and Pel Air shareholders.
It also said that the upgrading of its fleet with the first SAAB B-plus aircraft was on time to start from the end of this month, with one aircraft arriving every 5 weeks for the remainder of 2007.
The airline will lose the Olympic Dam route in South Australia next year after BHP Billiton appointed a charter operator. Rex said it had extra services planned elsewhere.
The NSW Government yesterday revealed it wanted greater competition on some regional routes in the state currently serviced by Rex.
Rex also said there would be further increases in charter and freight capability with SAAB aircraft being placed into Pel Air to supplement the Metros planes previously deployed.
