2nd UPDATE: Virgin Atlantic Shakes Up Board To On Recovery

Virgin Atlantic Tuesday promoted Julie Southern to chief commercial officer and elevated Tim Livett to succeed her as chief financial officer as the long-haul airline shakes up its board to focus on growth and leveraging signs of recovery.

Southern, 50 years old, will take responsibility for growing the airline following one of the toughest economic periods in aviation history. She will be responsible for network expansion, trade alliances and driving revenue through pricing, sales and marketing.

"This promotion and change of emphasis for Julie will enable Virgin Atlantic to change gear in its recovery from recession," Virgin Atlantic Chief Executive Steve Ridgway said. "Julie's expertise has enabled the business to steer a course through some very difficult times but now we can utilize her strengths at the front end of the business, driving new relationships, revenues and ultimately our growth strategy."

The appointment appears to put Southern in position as successor to Ridgway, but she declined to speculate. "I'm very focused on my new post and anything else is way down the road," she said.

Southern said Virgin Atlantic had experienced a better-than-expected summer after first-quarter revenue climbed 10% year-on-year.

Yields have recovered as the industry withdrew capacity, but Southern warned against adding too much capacity too soon, and advocated a need for the industry to pursue rational, disciplined and sensible pricing.

"Last year, it was extraordinary the scale at which (airline bosses) were cutting fares and that just wasn't sustainable," she said. "We are now dealing with permanently higher oil prices."

It was still too early to celebrate the recovery with uncertainty remaining in the U.K. on how trading will develop during the winter season, she said. Concerns include U.K. government spending cuts, a rise in air-passenger duty, a hike in January in the rate of value-added tax and the impact of those factors on consumer confidence.

Virgin Atlantic is following a strategy of steady growth. Expansion is expected to come from new routes and additional services, Southern said. The real "game changer" for the airline will come when the carrier takes delivery in 2014 of Boeing Co. (BA) 787 planes, which will provide range capacity that will open up new routes, including to the Far East.

Southern was instrumental in reshaping the business and reducing costs during the economic downturn, when demand for travel plummeted. Before that, she helped steer the airline in the aftermath of 9/11 terrorist attacks.

Livett, 48, will now join Ridgway, Southern and Chief Operating Officer Steve Griffiths on the main board. Livett joined Virgin Atlantic in 2004 from Hudson Highland Group Inc. (HHGP) where he was European chief financial officer. Prior to that, he held a number of senior financial and commercial roles during an eight-year period at British Airways PLC (BAY.LN).

-By Kaveri Niththyananthan, Dow Jones Newswires; 4420 7842 9299; kaveri.niththyananthan@dowjones.com

Hudson Highland (NASDAQ:HHGP)
Historical Stock Chart
From Apr 2024 to May 2024