So
VB made approximately $113 mil in the first half of FY07/08 and then made approximately $97 mil for the whole of FY 07/08
You are forgetting the $42.8 mil invested in VAUS/EMB/PE/Lounge/PB took from the business so
VB actually made $140.5 mil which was down about 25-30% from the previous full year. Which at the time was great considering the high price of fuel.
I think we will be surprised when
VB announces results soon. The $50 mil of cost cutting that has been done will help the bottom line and trimming the workforce by 5% in 2009 which is BG's worst case scenario should probably happen anyway. The company has a few middle managers that wouldn't be missed. There is $200 mil of fuel hedges that have been offset by $200 mil of currency hedges so they got a little lucky there.
At the end of the day they are still selling plenty of tickets and have increased business from the government (up 31%) and private sectors (up 14%). The finance minister reminded Federal Departments of the need to give 25% of there flying to
VB. At the time this was only around 10% so there is more revenue coming. These are areas that will continue to provide revenue for the company when the rest of the general population will probably slow down as they become increasingly worried about their jobs and put holidays on the back burner.
Interesting times ahead for all.
VB managers have only dealt with the good times so far. Lets see if they have what it takes to manage the company through the uncertain times.