Gregory Polek has spent his entire career in aviation journalism with AIN, starting as a proofreader and assistant to then-managing editor Mary Mahoney in 1995 after serving an internship with&nbsp;New Jersey Monthly&nbsp;magazine and completing his B.A. degree in English/Writing at New Jersey’s William Paterson College. By 1997 Polek accepted a position as an associate editor, covering the regional airline beat for&nbsp;Aviation International News&nbsp;in place of retiring industry veteran Don Anderson. The assignment took Polek across North America and Europe to profile regional airlines varying in size and mission from the likes of floatplane operators Kenmore Air and Chalk’s Ocean Airways to regional jet operators such as SkyWest and American Eagle. Today, in his dual role as Air Transport Editor and International Airshow Editor, Polek writes, edits, and manages AIN’s commercial aviation content while overseeing each of the company’s daily international air show publications in Paris, Farnborough, Singapore, and Dubai. Most recently Polek has assumed oversight of daily coverage of the Helicopter Association International’s annual Heli-Expo convention.

Senior Editor

Gregory Polek

Virgin Australia expects to raise some A$1.01 billion (US$738 million) under a restructuring plan announced on June 15 that would include the removal of its Embraer E190 fleet and a reduction in its ATR turboprops over the next three years.

 


The airline said it would offer&nbsp;existing shareholders one new share for every share they already own in a rights issue priced at A$0.21 cents each, which equates to a 28.8 percent discount on the group’s June 14 closing price.

 


Singapore Airlines, HNA Innovation, Virgin Group, Nanshan Group and Air New Zealand have made binding commitments to take up their pro-rata entitlements. Etihad Airlines, which owns a 24 percent stake, remains conspicuously absent from the list&nbsp;for now, and HNA’s participation remains contingent on regulatory approvals by Chinese authorities.

 


Virgin Australia said the plan to cut its regional aircraft fleets “will assist the group in simplifying its business and becoming more scalable and productive.” It also talked of improving certain “operating efficiencies,” including improved efficiency in crew and ground operations and initiatives aimed at curbing the effect of operational disruptions. In maintenance and engineering, it identified a plan to increase efficiency in scheduling. Finally, the company said it plans to reduce costs involving its supply chain and procurement activities, including cost cuts associated with major contracts, fuel handling, catering and heavy maintenance.

 


The airline expects to the moves to result in net free cash flow savings of A$300 million by the end of 2019.

 


“Our renewed capital structure will strengthen our balance sheet, provide additional liquidity and help fund initiatives to improve earnings and cash flow,” said Virgin Australia Group CEO John Borghetti. “Additionally, the new program of operational and capital efficiency initiatives will further deepen our focus on having a low, sustainable cost base.” &nbsp;

 


The latest announcement comes just two weeks after the Virgin Australia Group entered an alliance with China’s HNA Aviation aimed at expanding its presence in the Chinese travel market. The companies plan to introduce direct flights between Australia and China and cooperate on code-sharing, frequent flier programs, lounge access and promotion of tourism and business travel.&nbsp;On June 16, Virgin Australia confirmed that it has filed applications to begin direct service between various Australian cities and both Beijing and Hong Kong, starting in June 2017.

 


As part of the alliance, HNA agreed to execute a A$159 million placement of new Virgin Australia shares to its HNA Innovation. The placement results in HNA holding a 13 percent share of the Virgin Australia Group. HNA plans to raise its share to 19.99 percent with a so-called top-up placement subject to shareholder approval. Existing shareholders Singapore Airlines, Etihad Airways, Virgin Group and Air New Zealand have advised the Virgin Australia Group that they intend to vote to approve any additional top-up placement to HNA Innovation.

 


With the recent purchase of 19.99 percent of the Virgin Australia Group from Air New Zealand by Nanshan Group, Chinese interests now stand to own almost 40 percent of the Australian company.

 


“The Chinese travel market represents Australia’s fastest growing and most valuable inbound travel market, with inbound passengers from China increasing by approximately 18 percent per year since 2010,” said Borghetti. “In 2015, over one million Chinese travellers visited Australia, spending approximately A$8.3 billion in total on their journeys. By 2020, almost 1.5 million Chinese travellers are projected to visit Australia in a market expected to be worth up to A$13 billion.”

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