Virgin Atlantic flies back in the black

SIR Richard Branson's airline Virgin Atlantic has swung back into the black, but warned the outlook remains tough.

The business posted profits of £15.7m for the 12 months ended April, from a loss of £92.6m last time. The previous figures included around £100m in costs for cutbacks forced on the company following 9.11.

Business this time around suffered from the Iraq war, the Sars virus, sluggish economies and companies cutting travel budgets. Sales fell 6.6% to £1.4bn and passenger numbers fell 5.5% to 3.865m. Virgin Atlantic also had 576 fewer staff in the year just gone.

'There are still questions over the global economy and weak business market that show no clear signs of strengthening,' said Branson, the airline's chairman. 'Things will remain tough in our industry for some time.'

The carrier is 51%-owned by Branson's Virgin Group, and Singapore Airlines owns the remaining 49%. There was no immediate word on the talks revealed in May in which Virgin Atlantic was seeking a £2bn tie-up with bmi, the former British Midland.