Crawley based Virgin Atlantic has announced losses of £80 million for the last financial year.
Revenue was up three per cent and, with 5.4 million passengers, numbers increased two per cent.
The company fly out of Gatwick and Heathrow and say big hikes in the price of fuel and air tax has made it a difficult year.
The airline say even with the current climate it has still continued to invest with £50 spent upgrading planes at Gatwick and £100 million of improvements for its Upper Class passengers.
Virgin Atlantic Chief Executive, Steve Ridgway said: “In an incredibly challenging market, we have managed to grow top line revenues and fly more customers than last year.
"However, with the prevailing uncertainty in the economy, sky high fuel prices and a 25% hike in our air passenger duty fees, converting this sales growth into profit has not been possible.
“Despite this backdrop there can be no let up so to keep Virgin Atlantic at the forefront of airline customer innovation we have announced our biggest ever service and cabin investment programme.
“We have had an encouraging start to the year, continuing to grow our passenger numbers and our revenue. Our new route launches to Vancouver and Cancun will strengthen our position as the number one UK long haul leisure airline.
"The Mumbai route will prove very important in connecting business traffic from East to West via London and enabling the UK to better connect with the one of the world’s most vibrant economies.
“The introduction of the A330 aircraft will further enhance what is already one of the youngest fleets in the world and each plane will use 15% less fuel per seat. These aircraft will add significant additional cost savings to our operating efficiencies programme, helping us to combat the economic headwinds that are currently prevailing,”