Rex Airlines records $46.1m loss amid rising costs

A major airline has failed to deliver a dividend after suffering a massive $46.1m loss, with the pandemic largely to blame.

Rex Airlines has recorded a $46.1m loss, which is the company’s worst performance in 16 years amid rising costs.

It comes despite an increase in revenue of $319.2m, with the airline hopeful of better results in the next financial year.

Rex reported fuel costs were at $65.4m due to the war in Ukraine, while staff costs reached $149.4m, which was an increase of almost 40 per cent as a result of new domestic flights.

“The lingering impact of Covid-19 meant that passenger services did not start to recover until February 2022,” executive chairman Lim Kim Hai said.

“Prior to that, both the Domestic Jet Operations and Regional Saab Operations were either suspended or greatly reduced.

“Considering that Covid devastated practically three quarters of the financial year and the war in Ukraine starting in February — causing crude oil prices to skyrocket by over 70 per cent during the financial year, peaking at a near record high of A$174 per barrel in June 2022 — as well as other supply shocks on the international economy, I am mildly pleased that our performance is not much worse than it is.”

Rex took a massive financial hit. Picture: Supplied

He said he was confident the airline had “turned the corner”.

“In July, the Domestic Jet Operations load factor was at an all-time high of 86 per cent whilst the Regional Saab Operations saw higher passenger numbers, revenue and load factors compared to pre-Covid figures despite five per cent less flying,” he said.

“These pleasing outcomes are the result of partnerships with corporates and travel agencies that were entered into at the end of the prior financial year.

“We have already seen 35 per cent of the committed monthly amounts for the partnerships in the first two months and we have every reason to believe that the performance will get stronger in the coming months.

“I note also that fuel prices have retreated to A$130 per barrel in the most recent week.”

The company did not declare a final dividend in light of the losses due to the pandemic.

Originally published as Rex Airlines records $46.1m loss amid rising costs