Regional Express (ASX:REX) share price edges lower on revised guidance

The regional airline operator shares are in the red today. We take a closer look into the company's latest release…

| More on:
qantas pilot putting hands to her face as if distraught

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Regional Express Holdings Ltd (ASX: REX) share price is in negative territory today. This comes after the regional airline operator advised it has revised its interim guidance for the current financial year.

At the time of writing, Regional Express shares are down 1.59% to $1.235.

Regional Express headwinds

In a statement to the ASX, Regional Express announced it will not meet its previously forecasted guidance given on 10 May 2021. The company earlier noted that it expected to break even for the 2021 financial year.

However, after the latest COVID-19 interstate border restrictions and lockdowns, Regional Express has suffered a loss in potential revenue. Forced flight cancellations to and from Melbourne, in particular, has disrupted the airline's recovery from the fallout of the pandemic.

This comes at a time when the company introduced new $39 fares between Sydney and Melbourne to challenge its bigger rival, Qantas Airways Limited (ASX: QAN).

As a result, Regional Express is now projecting a full year statutory loss before tax of around $15 million.

The company also said that it will be refunding affected customer tickets, in line with its COVID-19 refund guarantee policy.

Last month, Regional Express noted that overall demand across its business is sitting at 60% from pre-COVID levels. However, some states in Australia are performing better than others, with Queensland and Western Australia taking the lead.

Operations such as the Coffs Harbour and Port Macquarie route commenced in late March this year. Interestingly, these two regional centres account for around 40% of the total number of passengers in Regional Express' entire network.

Regional Express share price summary

Despite today's slight fall, over the last 12 months, Regional Express shares have climbed around 10%. Year-to-date share price performance has gone in the opposite direction, down more than 40%.

On valuation grounds, Regional Express has a market capitalisation of roughly $136 million, with approximately 110.1 million shares on issue.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Travel Shares

Bored woman waiting for her flight at the airport.
Travel Shares

Why is the Flight Centre share price falling today?

What's going on with this travel agent's shares?

Read more »

Man sitting in a plane seat works on his laptop.
Travel Shares

A 'once in a lifetime' opportunity for Qantas shares?

Can this stock fly higher?

Read more »

Two elderly men laugh together as they take a selfie with a mobile phone with a city scape in the background.
Travel Shares

Act fast if you want to receive the next Flight Centre dividend

It won't be long until this travel agent pays its next dividend.

Read more »

Man sitting in a plane looking through a window and working on a laptop.
Travel Shares

Why is the Webjet share price racing to a 52-week high today?

Webjet has been busy talking up its WebBeds business this morning.

Read more »

A businessman points a finger in accusation, indicating a share price or ASX company in trouble
Travel Shares

Qantas shares hit turbulence amid $250,000 fine for 'shameful' conduct

ASX 200 investors are bidding down the Qantas share price on Wednesday.

Read more »

A woman ponders a question as she puts money into a piggy bank with a model plane and suitcase nearby.
Travel Shares

Flight Centre shares plunge 7% despite return of the interim dividend

ASX 200 investors are sending the Flight Centre share price spiralling lower on Wednesday.

Read more »

Happy couple looking at a phone and waiting for their flight at an airport.
Earnings Results

Flight Centre share price on watch amid 565% half-year profit surge

Flight Centre shares could see some sizeable moves today after the ASX 200 travel stock reported on its half-year results.

Read more »

Two elderly men laugh together as they take a selfie with a mobile phone with a city scape in the background.
Travel Shares

Own Flight Centre shares? Here's what you need to know ahead of its results

The travel agent giant is releasing its results on Wednesday next week.

Read more »