Virgin Australia has posted an eight-fold rise in underlying profit before tax in the first half to $81.5 million as a result of ongoing fare increases in the domestic market and better conditions in the international market. 
On a bottom line basis, Virgin reported a $62.5 million profit in the first half, up from a $47.8 million loss in the same period the prior year. It did not reveal how much the lower fuel price had contributed to the result, but the carrier has previously flagged relatively lesser benefits from the oil price fall than rival Qantas.
Virgin will not unveil its detailed half-year financial figures until   February 11, but it provided information on its   December quarter results on Thursday because major shareholder Singapore Airlines is obliged to disclose its share of Virgin's earnings each quarter.
Virgin reported an underlying profit before tax of $73 million in the   December quarter, up 32.2 per cent from the prior year, in what is typically the strongest quarter of the year for the airline. 
Consensus estimates are for Virgin to report a full-year underlying profit before tax of $143.4 million, up from a $49 million underlying loss before tax the prior year. Qantas is expected to report an underlying profit before tax of $1.67 billion this financial year.
Virgin chief executive John Borghetti said his airline's performance in the   December quarter was underpinned by strong unit revenue and yield growth, particularly in Virgin's domestic arm, as well as an ongoing improvement in Tigerair Australia, strong momentum from the Velocity loyalty arm and strict cost discipline.
While the financial performance in the domestic market was positive as a result of fare increases, there were signs demand remained weak. Virgin cut its domestic capacity by 1.2 per cent during the period and filled 77.7 per cent of seats, down from 78.1 per cent the prior year.
Qantas, which trimmed mainline domestic capacity slightly in   October and   November but has not yet released statistics for   December, filled around 77.4 per cent of seats during that period.
Both carriers have been more rational with their capacity levels since 2014. Airfare prediction app Hopper's Consumer Airfare Index for Australia last month found the average domestic leisure flight for leisure travellers had risen by 2.9 per cent to $271 over the last year, despite the decline in oil prices. That compares with other regions, such as the United States, where domestic airfares have been falling.
Mr Borghetti said Virgin's international business had continued to improve, despite the financial impact of volcanic activity in Bali which led the carrier to cancel around one-third of its flights to the holiday destination in   November.
Virgin filled 82.7 per cent of international seats in the   December quarter, up from 80.8 per cent the prior year, having flown 6 per cent fewer available seat kilometres as a result of the Bali issues. 
Virgin will switch its flights from Melbourne, Adelaide and Perth to Bali from its mainline division to low-cost carrier Tigerair from next month to help improve its financial results.
Tigerair grew its capacity by 7.4 per cent as a result of having added its 14th A320 aircraft, but it managed to keep the percentage of seats filled steady at 86.5 per cent.