Virgin Australia shares slide 9% after airline slashes 750 jobs on mounting losses
The job cuts will impact close to 8% of the airline’s total workforce and will shrink corporate and head office staff, Virgin Australia said in a statement on Wednesday.
Airline company Virgin Australia Holdings announced a wide-ranging operational review and the slashing of 750 jobs on Wednesday after it posted its seventh straight year of losses.
The group’s shares sank to the lowest level since 2009 after the announcement. The stock shed as much as 1.5 Australian cents or 9.1%, to 15 Australian cents at around 10.30am Sydney time before clawing back some losses to close the day’s trading 6.06% lower, at 1.6 Australian cents.
The job cuts will impact close to 8% of the airline’s total workforce and will shrink corporate and head office staff, Virgin Australia said in a statement on Wednesday. In addition, the group will be cutting some international and domestic flights as it plans to review its fleet and routes.
The carrier’s existing contracts with suppliers will also be reassessed.
Commenting about the group’s results, chief executive officer Paul Scurrah called the airline’s A$349.1 million in losses ‘disappointing’ and ‘underscored the need for change’. ‘We must improve our financial performance,’ he said.
The carrier is among the most thinly traded airlines in the market, with a free float of less than 10%, according to Bloomberg.
It is collectively owned by HNA, Nanshan Group, Virgin Group, Etihad Airways and Singapore Airlines.
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