Virgin slashes jobs after $349m loss
VIRGIN Australia says it will cut 750 corporate and head office positions as part of a restructure after posting a "disappointing" full-year loss of $349.1 million.
Revenue for the 12 months to June 30 rose 7.5 per cent to $5.83 billion and the airline has not declared a final dividend.
"There is no doubt that we are operating in a tough economic climate with high fuel, a low Australian dollar and subdued trading conditions," Virgin Australia chief executive Paul Scurrah said.
"Decisions which have a direct impact on people's livelihoods are never made lightly and I regret the need to reduce the size of our workforce so quickly," he said.
"However, today's financial results tell us loud and clear that we need to reduce costs."
Mr Scurrah has flagged a shake-up of the airline's leadership team and 750 job cuts across the workforce, The Australian reports. A fleet and network review is also planned, which is likely to result in further capacity reductions.
The job cuts are expected to deliver savings of $75 million a year to the business and represent about 7.5 per cent of the total workforce of 10,000.
Mr Scurrah said the acknowledged the axings would impact team members.
"However if we are to position the business for the future, create new opportunities, improve competitiveness, and continue to deliver for our customers, we need to make tough but important decisions that are in the long term interests of the group," Mr Scurrah said.
"Key to our success is ensuring we strike the right balance between the interests of our team members, customers and our shareholders. We'll be focused on delivering for all three groups."
Virgin Australia will move to merge key executive roles to be responsible for all airlines. As a result, chief financial officer Geoff Smith and Tigerair CEO Merren McArthur will depart the business as part of the wide-ranging restructure.