Is it a new sim I presume as you said you've not sent a text before from phone, although it is strange you can do everything else but text, usually you have to activate the sim with virgin then everything should work after about ten minutes.To activate sim you have two choices, the first choice is texting ready to 789678 on old sim, but easier way is on the web,
www.virginmobile.co.uk/activate, just follow the steps, basically putting in your mobile number and thats it. switch off phone and reboot.
---------- Post added at 22:43 ---------- Previous post was at 22:38 ----------
Perhaps under network settings it needs to be set to virgin, usually its automatically done when sim is placed in