Virgin Australia increasing flight offering

Virgin Australia, which is almost 26 per cent owned by Air New Zealand, made the announcement when confirmed a full-year underlying pre-tax loss of A$49 million. Photo / Bloomberg

Virgin Australia is increasing flights to New Zealand.

The airline said it would add extra services between Melbourne and Christchurch and between Brisbane and Auckland, Dunedin, Wellington and Christchurch.

It will also fly some more services to the Solomon Islands, Fiji and Samoa.

"These increases represent more than 52,000 additional seats on trans-Tasman and Pacific routes during the 2016 financial year."

Some of these will be seasonal services. Rival Qantas is also putting more more flights across the Tasman.

Virgin Australia, almost 26 per cent owned by Air New Zealand, will from next 23 March 2016, withdraw from flying to Denpasar from Melbourne, Adelaide and Perth but its low cost subsidiary Tigerair Australia will launch in the short-haul international market by picking up those routes.

The airline made the announcement when releasing its full-year results which confirmed figures in its fourth quarterly announcement last week.

Virgin's full-year underlying pre-tax loss was A$49 million in the year ended of June 2015, an improvement of A$162.7 million on the previous financial year but will flow through to its owners' accounts, including Air New Zealand.

Virgin Australia narrowed its statutory net loss to A$93.8 million from A$353.8 million a year earlier, and saved about A$60 million due to the fall in oil prices.

That was partly offset by a A$35 million negative impact of a weaker Australian dollar on operations.

Virgin Australia chief executive John Borghetti said 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. Its current cost of capital is 10 per cent.

Borghetti said the full acquisition of Tigerair Australia had given the airline further capability to lower the group's unit costs.

"The group is ahead of our target of $1 billion of cumulative cost savings by the end of financial year 2017. We are now on track to achieve in excess of $1.2 billion in cumulative cost savings by this date, excluding fuel pricing and hedging benefits."

He said the group's balance sheet is also in a much stronger position, with the highest ever full year unrestricted cash balance, a A$225.8 million improvement in operating cash flow and a 20 per cent improvement in financial leverage on the 2014 financial year.