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“Committed” Rex considers third route

Friday, 2nd March, 2012

By Gayle Hogan

Regional Express said it would do everything in its power to prevent flights to and from Broken Hill being cut in the face of rising costs.

It might even establish a new service to Melbourne, said Rex’s General Manager of Network Strategy, Warrick Lodge.

Mr Lodge said other centres may have flights reduced or cancelled due to falling passenger numbers and rising fuel costs.

He said an agreement with BH City Council, which provided certainty of airport charges for the next five years, meant Rex considered flights to and from Broken Hill differently.

“Rex is really committed to continuing to provide services from Broken Hill to Sydney and Broken Hill to Adelaide,” he said.

“We gave our commitment to do what we can to maintain our services.

“That is a real tangible benefit of the partnership.”

Rex this week announced its first half 2011/2012 financial year results, with a before tax profit of $18.5 million on turnover of $139 million, a 52 per cent increase on the previous year.

The announcement said Pel Air and all other subsidiaries showed improved results, but the situation with the passenger airline services operated by Rex was less rosy with passenger numbers down almost four per cent. 

Passenger numbers for the Adelaide to Broken Hill route dropped by two per cent compared to the previous year, while the Sydney-BH route was up by two per cent.

Mr Lodge said despite the “very tough operating conditions,” Rex was investigating the possibility of another service for Broken Hill.

“We are looking at what could be done for a Broken Hill to Melbourne route.”

Commenting on Wednesday’s financial results, Rex Executive Chairman Lim Kim Hai the Federal Government’s carbon tax and other taxes and cost increases would cost Rex more than $6 million per annum.

“Rex will be monitoring the situation closely and in the absence of a more favourable environment will be compelled to divert its resources from marginal regional routes to more lucrative mining charters in order to protect shareholder returns,” he said.

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