Virgin Atlantic has experienced a surge in traffic over the past quarter as passenger desert strike-ridden rival British Airways. However this failed to prevent the long-haul carrier from registering heavy losses over the period.

Virgin’s group full-year, pre-tax operating loss for March 2009 to February 2010 was £132m, compared with a profit of £60m for the same period the previous year.

Revenues for 2009/10 decreased 8.6 per cent to £2.35 billion but operating costs reduced 8 per cent.

But it says the picture is improving with both revenues and passenger numbers up in the first quarter of its new financial year, from March to May. Total airline revenue rose 10 percent to £513m, the passenger load factor was up 5 percent to 82 percent. Cargo revenues rose 36 percent to £52m.

The business class market increased 15 percent over the quarter, whilst the airline also benefited from a successful start to its new service to Accra in Ghana.

The airline said customer compensation and operational cost of the Iceland volcanic ash cloud crisis was likely to cost it £30 million.

Steve Ridgway, Chief Executive of Virgin Atlantic, said: “The start of the year has been encouraging despite difficult trading conditions. Demand is picking up across the majority of our routes and forward bookings for the summer have been very positive.”

Virgin gets a make-over

The airline has also unveiled a new livery and brand identity in its creative first revamp in five years.

The new design will be applied across the carrier’s fleet of 38 aircraft, as well as signage, communications and advertising.

The flag carrying flying lady, who appears on all Virgin Atlantic aircraft, has been given a “subtle cosmetic makeover” fluttering a larger Union Jack.

Chief executive Steve Ridgway said: “Despite the most challenging economic conditions that we have encountered for some time, this is just one of many design projects that Virgin Atlantic has invested in.

“Virgin Atlantic has a strong history of investing during downturns and we believe that our new livery and the forthcoming delivery of the Airbus A330-300 signals another period of growth for the airline.”