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3Q10 result gives Virgin America first quarterly net profit

Virgin America has announced a third quarter net profit of $7.5 million – the carrier’s first quarterly net profit.

The airline reported a record quarterly operating profit of $21 million (a 314% improvement year-over-year), resulting in a 10.4% operating margin for the quarter. The airline reported revenues of $202 million for the quarter, 28% higher than 3Q09. The airline also reported strong unit revenue performance (RASM) for the quarter, with a 17% improvement year-over-year, a period in which the industry’s unit revenue grew by 10%.

“As a young airline fuelling growth in a tough economic climate, we’re exceptionally pleased with our performance to date,” commented Virgin America president and CEO David Cush. “Although the revenue climate improved as a whole during the quarter, our unit revenue performance still outpaced much of the industry. Our progress towards profitability in just our third year of operations remains impressive, especially given both a global recession and a historic run-up in oil prices since our August 2007 launch.”

The airline’s yield per passenger mile in the third quarter was 11 cents, up 20% on 3Q09’s figure.

In cost control, operating expense per ASM excluding fuel (ex-fuel CASM) increased by 5% due to investment in growth (training, people and aircraft in modification) during the quarter along with one-time credits in 2009.

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