Virgin Blue said it would break even in its new financial year if trading conditions did not deteriorate further, as Australia’s second largest airline reported a net loss of A$160m ($133m) for the year to June.

The loss compares with A$98m profit last time as Air New Zealand reported full-year net profits down 90 per cent to A$21m. Qantas, Australia’s dominant carrier, this month reported an 87 per cent fall in full-year profit.