Online Stockmarket Trading Update

Virgin Blue Holdings Limited (VBA) and Etihad Airways PJSC today signed an agreement establishing a commercial partnership that will enable Virgin Blue’s international arm, V Australia, to launch direct services to Abu Dhabi in 2011 and the two airlines to offer a joint network of more than 100 destinations from October 1, 2010. Together, Etihad and V Australia will move towards a total of 27 weekly services between Abu Dhabi and Australia – including double-daily services between Abu Dhabi and Sydney, daily Melbourne-Abu Dhabi flights and six frequencies per week between Abu Dhabi and Brisbane. V Australia will operate three Sydney-Abu Dhabi services per week from February 2011 and three Brisbane-Abu Dhabi services per week by February 2012, using its new fleet of three-class Boeing 777-300ER and becoming the first Australian carrier to operate to the Middle East since 1991.

From October, Virgin Blue Group customers can access Etihad’s network of 65 destinations across North America, Europe, Asia, the Middle East and the Subcontinent. All Virgin Blue services will be available to Etihad customers, opening up 45 destinations in Australia, New Zealand and the Pacific Islands, and to Asia, South Africa and Los Angeles. The agreement integrates the Etihad Guest and Velocity frequent flyer programs, allowing members to earn status/tier points and frequent flyer points immediately along with reciprocal service benefits and lounge access for top tier members of both programs. The ability for members to burn miles on both carriers’ services comes into effect from October 1. Under the agreement, the two airlines will explore further avenues of cooperation, and will lodge an application for authorisation with the Australian Competition and Consumer Commission to allow them to cooperate across a broad range of commercial functions. It is only with this further cooperation that the airlines will be able to offer the full program of benefits the partnership will bring.

The Chief Executive Officer of the Virgin Blue Group of Airlines, Mr John Borghetti, said the alliance with Etihad allowed it to redefine its long-haul operation and unlock a genuine global network that would be particularly attractive to Virgin Blue’s business and international leisure travelers. “Everybody wins from this partnership. It increases competition, choice and convenience for the traveling public. Etihad will gain access to the valuable domestic feed in Australia and the Virgin Blue Group will gain access to an extensive international network serving multiple destinations across the Middle East, the UK, Europe, Africa and Asia. Mr Borghetti said: “We expect the strategic alliance to have significant revenue and profit upside for both carriers. Importantly, each business will immediately gain from reciprocal traffic flow.” Etihad Airways’ Chief Executive Officer, Mr James Hogan, said the partnership would grow to become one of the Gulf carrier’s most significant.

www.virginblue.com.au

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