BRUSSELS, Belgium, Feb. 28, 2002 (PRIMEZONE) -- Virgin Express (Euronext Brussels: VIRE) (Nasdaq:VIRGY), the profitable low-fare Belgian airline, announces that the merger talks with SN Brussels Airlines (formally DAT) have ended, by mutual agreement. After two months of detailed discussions, both companies have decided that it is not in their mutual interests to merge both on financial and cultural grounds.
Virgin Express will continue in its role as a low fare operator serving the business and leisure markets and both airlines will continue to develop relations to meet the commercial interests of both parties, whilst remaining competitors in the Brussels market.
With more freedom to choose its own suppliers since the demise of Sabena, Virgin Express has seen its performance improve markedly. For the last three months more than 90% of all its flights have left on time. As a result Virgin Express has been the most punctual airline flying from Brussels, Barcelona, Madrid and Copenhagen when compared to members of the Association of European Airlines. On all other routes the airline ranks high in the upper quartile, including London Heathrow where it ranks third.
As previously announced, Virgin Express expects to show a breakeven operating result for the year ended December 31, 2001, in line with forecast. This has been achieved despite a challenging 4th quarter, caused by the cancellation of the Sabena contract, which previously accounted for over 40% of Virgin Express revenues. Since being freed from this contract in early November 2001, Virgin Express has made great progress in growing its sales. Current bookings are at an all-time high, over 60% ahead of last year and significantly higher than in the summer months. Load factors for the month of February averaged 80%. In line with last year's improved performance, we expect a profitable 2nd quarter 2002 following the normal 1st quarter's seasonal loss.
Sir Richard Branson, Chairman Emeritus of Virgin Express, commented: "I am very pleased by the excellent performance of our team at Virgin Express over the past year and in particular over the past four months. I fully support the exciting plans that our management has to expand from Brussels into the rest of Europe. Our determination to grow in Europe has been encouraged by the success of Virgin Blue, our low fare operator in Australia, where we are now Australia's second largest carrier."