(Reuters) – Australian airline Regional Express on Tuesday forecast an operational loss for fiscal 2023, citing a global shortage of pilots and engineers, as well as significantly lower business travel in May and June.
The carrier said it was now expecting to record a group operational loss of A$35 million ($23.8 million) for the financial year 2023, from an earlier estimate of a profit.
An ongoing shortage of pilots and engineers, along with supply chain shocks post COVID have disrupted Rex’s network, forcing it to make “significant reductions to its flight schedules over the last couple of months to match the need for aircraft, pilot and engineers to what is available,” the company said in a statement.
The country’s competition regulator too said in its latest report on airline competition in Australia that the industry was facing challenges due to shortages in qualified and experienced Australian pilots and engineers.
Rex also flagged a significant drop in business travel in May and June due to corporate travel budgets being exhausted following an exponential increase in international ticket prices.
The airline, however, remained optimistic about logging a group operational profit before tax in fiscal 2024 and beyond on sustained expansion of its domestic network.
Rex held a market share of 4.8% in April 2023, according to the report by the country’s competition regulator, meager compared with the 60.8% and 33.2% share controlled by Qantas Group and Virgin Australia, respectively.
($1 = 1.4715 Australian dollars)
(Reporting by Echha Jain in Bengaluru; Editing by Dhanya Ann Thoppil and Nivedita Bhattacharjee)
