BRUSSELS, Belgium, Feb. 7, 2002 (PRIMEZONE) -- Virgin Express (Nasdaq:VIRGY) (Euronext Brussels:VIRE):
In recent months many reports have indicated that the travel trade has been hit hard by the economic downturn in the aftermath of September 11. Moreover, the demise of Sabena caused instability in the Belgian travel market and this had immediate adverse effects on air travel. However, it seems that a new market balance has now been found in Brussels. Virgin Express announces that its January 2002 sales figures showed substantial improvement in comparison to January 2001 and to recent months.
This encouraging development is not only reflected in passenger numbers and load factors, but also in revenue. Both sales to the travel trade and direct sales have picked up substantially over the last month. First indications show a 56% increase in internet bookings year on year for January 2002 and even greater growth generated by the introduction of the unique ticketless GDS (global distribution system) for travel agencies. This system allows agents to make online bookings through their systems, but at over 80% lower cost than traditional airlines. This facility has tightened the airline's relationship with travel agents throughout Europe, who have substantially increased their sales on Virgin Express. In January, 23.9% of seats were booked through the GDS systems, and this accounted for 31% of the scheduled revenue.
Virgin Express has a commercial agreement with DAT similar, but on a different scale, to the agreement it had with the former Sabena, whereby certain blocks of seats are sold in advance to the partner airline. Excluding these seats, sales revenue in January 2002 was up 65.4% in comparison to that in January 2001. A comparison on a route-by-route basis shows that revenue from the eight routes flown throughout the period from/to Brussels (Malaga, Barcelona, Copenhagen, Rome, London-Heathrow, Milan-Linate, Madrid and Nice) increased by 59.9% year on year.
More Corporate Travellers
Our monthly passenger survey results show that the percentage of people travelling for business-related reasons on our flights now accounts for about 50% of our passengers.
Changes in consumer patterns in general mean that most customers, including those travelling for professional reasons, have become more cost-conscious. As a result of the economic slowdown many companies are trying to cut costs in all areas, especially in travel expenses. Furthermore, many corporate customers are fed up with the various fare restrictions imposed by the large traditional airlines on day and midweek returns.
For this reason more companies prefer to travel within Europe with low-fare airlines like Virgin Express, as these carriers apply a simple fare structure without fare restrictions like the Sunday-rule. Consequently, the number of contracts that Virgin Express has with corporate clients has risen sharply. In the Benelux alone the increase over the last three months has been 63.7%.
Other remarkable results from the latest passenger surveys show that 81% of the passengers rate the value for money they receive on Virgin Express as "good" to "excellent." Moreover, 99% of passengers surveyed would recommend Virgin Express to a friend or a colleague.
Much of this passenger satisfaction must be due to the improved punctuality of Virgin Express flights since the demise of Sabena. Over the last three months 90.2% of Virgin Express flights have left on time and, of the few delays that have occurred, almost all have been the result of bad weather or ATC problems. This level of punctuality is well above the industry average.