Oil threatens Virgin Blue's long-term outlook, Skymark continues rally
Shares in Australia’s Virgin Blue dipped 2.3% yesterday. Maquarie analysts lowered the carrier’s underlying profit forecast by 21% for FY2011 and 10% for FY2012, due to the prospect of oil prices returning to more than USD100 per barrel.
Macquarie believes Virgin Blue’s alliances may help shelter it from the effects of the increase in oil prices. Virgin Blue has signed agreements with Air New Zealand, Etihad Airways and Skywest Airlines over the past six months.
Japanese LCC Skymark Airlines gained 6.2%, continuing its five-day upward run. The stock has gained 3.9% for the year-to date after falls earlier this month. Shares in other Asian LCCs were down, with Tiger Airways slipping 0.5% and Air Asia down 0.3%
Selected LCCs' daily share price movements (% change): 18-Jan-2011