Australia's Virgin Blue profit falls 33 per cent

SYDNEY - Australian budget airline Virgin Blue , which is majority owned by takeover target Patrick Corp, said annual net profit fell 33 per cent as it had forewarned on higher fuel costs and increased competition.

Net profit for the year ended September 30 dropped to A$105 million ($113.5 million) from A$157 million a year ago. The company changed its accounting period earlier this year and said last month it expected an annual profit of about A$105 million.

Virgin Blue Holdings, which does not hedge the price its pays for jet fuel, competes in the Australian market against Qantas Airways, which operates a full-service domestic airline as well as budget carrier Jetstar.

Shares in Virgin Blue, in which Patrick owns 62.4 per cent and Richard Branson's Virgin Group has 25.6 per cent, have risen 12 per cent in the past two weeks on lower crude oil prices.

Australia's largest land transport company, Toll Holdings, launched in August a A$4.6 billion scrip-and-cash offer for Patrick, the country's largest ports operator. Patrick has rejected the offer as a crude attempt to stymie a competitor.

- REUTERS