Australian regional carrier Rex Airlines has to revisit a few of its previous predictions about its financial results, as things haven’t exactly gone the way in which it had hoped for. A scarcity of an adequate workforce has kept lots of its planes grounded, impacting operations and, ultimately, the balance sheet. Because of this, the airline expects to make a loss within the financial yr versus the previously predicted profit.
Loss forecasted
In its latest announcement, Rex Airlines is now forecasting a Group Operations lack of $35 million for the financial yr. That is despite the airline saying that unaudited revenue from regional Saab operations is greater than pre-COVID levels and the corresponding EBITDA can be positive for the financial yr.
In keeping with the airline, the principal reason behind the projected loss is a shortage of pilots and engineers required to sustain full-scale operations. Post-pandemic supply-chain issues globally have also played a task in negatively impacting its funds.
Moreover, a slump in demand has also added to Rex Airlines’ woes, as rising airfares have impacted business travel in a post-COVID world. The airline stated,
Shares plummet
Rex’s shares have also been affected and went down 15% following the announcement. Walking back on its previous prediction of a profitable FY has impacted its market numbers, and a plummet in shares was not all that surprising.
A significant slice of Rex’s Saab fleet is grounded on account of supply chain issues and a scarcity of enough pilots and maintenance crew. The airline has been forced to chop flights to several regional destinations in Latest South Wales, South Australia, Queensland, and Victoria.
Rex stays optimistic
The airline, nevertheless, is optimistic that things will change moving forward because it stays committed to expanding its jet operations in Australia’s domestic market. Positive development happening inside its subsidiaries can be keeping its spirits up. It commented,
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The airline is making good use of its Boeing 737 fleet and adding more connections for the winter season in Australia. Just a few days ago, Rex announced it had added mainline flights from Melbourne to Hobart and secured two more Boeing 737s for its domestic operations.
It is predicted that Rex can have a fleet of nine Boeing 737s by next month, providing the airline some relief from the grounding of its Saab planes. In keeping with the newest OAG data supplied by Rex, the airline plans 132 weekly departing 737 flights in July. The brand new service to Hobart in August will even allow seamless connections to Rex flights from Melbourne to Sydney, Brisbane, and Adelaide, in addition to to other regional destinations.
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