Virgin has axed around 4,700 jobs following the virus outbreak, or almost half of its staff
AFP / Oli SCARFF

Virgin Australia (VA) has reported a profitable year, with a 6.8% revenue jump, improving its financial health as it prepares for a potential Initial Public Offering (IPO).

The airline's financial basis was strengthened as Qatar Airways completed its 25% equity purchase, bringing Virgin Australia one step closer to returning to public ownership, Reuters reported.

Virgin Australia, the country's second-best airline, rebounded strongly after its merger with U.S. private equity firm Bain Capital in 2020. The Bain Capital takeover bid gave the airline a fresh leash of life to compete with Qantas Airways and return to profitability for the first time in 11 years, per Econo Times.

"Continued improvement in profitability means we are well-positioned to deliver great value and choice to Australian travellers," Virgin Australia CEO Jayne Hrdlicka said in a statement. "It is essential to our ability to re-invest in our business and customer experience, and vigorously compete with our major competitor."

Virgin Australia announced underlying earnings before interest and tax of AU$519 million ($350 million) for the fiscal year ending June 30, which marked an outstanding 18.2% rise over the previous year, despite not disclosing its after-tax profit data.

Qantas Airways, on the other hand, recorded a 16% drop in underlying earnings before taxes, or AU$2.08 billion, annually. Lower fare pricing, higher customer service expenditures, and decreased freight revenue were blamed for the drop.

The partnership between Qatar Airways and Virgin Australia is viewed as a significant vote of confidence in Australian aviation, enhancing choice and value for Australian travelers. The strategic alliance aims to strengthen Virgin Australia's financial resilience and drive strategic growth.

As a result, Australians can expect the launch of long-haul international flights by mid-2025, expanded code-sharing arrangements, and collaboration on sustainability initiatives, VA said in a statement.