Virgin share tumble after profit warning

VIRGIN Australia's shares have tumbled following a profit warning issued by the airline after the market closed on Wednesday.

Virgin Australia said its profits would be lower than those for 2011/12.

"The adverse impact to revenue from the introduction of the Sabre (reservation) system in the third quarter is not likely to be recovered by the end of FY13, given the slower than anticipated improvement in trading and economic conditions," the airline said in its trading update.

In February, Virgin Australia reported a first half profit slump of 56 per cent, but said it expected to improve its underlying performance despite challenging economic conditions.

The airline made a net profit of $23 million in the six months to December 31, down from $51.8 million in the previous corresponding period.

At 1105 AEST, its shares were down 3.5 cents, or 7.61 per cent, to 42.5 cents.

Meanwhile, it expects to complete its 60 per cent purchase of budget carrier Tiger Airways in July.

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