Today REX announced a return to profitability following several months under par upon restarting operations in February of this year. The regional airline saw a return to profit during the month of September, signalling a shift in domestic travel.
REX returns to profitability on-schedule
For many airlines, post-pandemic recovery has been slow and non-linear. However, Regional Express has come out on top in Australia, announcing a profitable return for the month of September. The regional airline only resumed full operations in February 2022 following one of the world’s strictest lockdowns seeing non-essential travel grounded for the better part of two years in Australia.
Mr Lim Kim Hai, Executive Chairman of Regional Express, said the airline marked September as the month they would return a profit. The airline has seen a rapid recovery in the first three months of this financial year, growing by 60%, 34% and 77%, respectively.
“This result was foreshadowed in our media release of 24 June 2022 when we predicted that the agreements with corporates and travel agencies, finalised at the tail end of the prior Financial Year (FY), would very quickly translate into strong passenger and revenue growth.”
Revenue growth has been even stronger, with returns of 84%, 47%, and 137% in the same period of time, suggesting a significant yield improvement. The regional airline is expecting the 2023 financial year to be profitable as a whole, with promising results in October already exceeding September.
“The Board gave guidance on 2 August 2022 that it expected FY 2023 to be profitable overall and the current results has further strengthened its conviction.”
Mr Lim also noted that revenue is continuing a strong upward trend as it increased 35% on just 13% more REX flights in October so far. “Encouragingly, October 2022 appears to be even stronger than September 2022, with passenger numbers on the jet network 16% higher for the first half of the month when compared with the previous month, while revenue increased 35% on 13% more flying.”
The airline is actively looking to add to its fleet
Regional Express is Australia’s largest domestic and regional airline flying to 58 destinations with a fleet of sixty-one Saab 340 and seven Boeing 737-800NG aircraft. The airline is now actively looking to add to its fleet to expand domestic jet services. Mr Lim says the airline is looking to purchase two Boeing 737-800NG aircraft, increasing their 737 fleet to nine.
REX currently have six 737-800’s in service, with one parked since January 2021. In September 2022, the regional airline leased a 737-800 from an unconfirmed lessor, registered VH-MFM. At just 8 years old, it’s currently the airline’s youngest Boeing, while the average age of the fleet of seven stands at just 14.4 years old.
The mascot-based regional airline is also trailing an electric hydrogen-powered MagniX engine fitted to one of their 34-seat Saab 340s. Initially, this hybrid aircraft will be used on shorter routes, such as Adelaide to Mount Gambier. The engine will work on a combination of batteries and hydrogen gas.
Currently offering some of Australia’s most affordable regional and domestic connections, the airline has found itself favoured over national competitors such as Qantas Link and Virgin Australia Regional Airlines. Regional Express currently offer a deal connecting Brisbane to Sydney for just $84, only edged out by Jetstar, who offer the same flight at $75 one-way.