Qantas hails transformation programme after return to profit

Qantas hails transformation programme after return to profit

Qantas has returned to the black with a A$206 million post-tax profit in the six months to the end of December.

The Australian carrier made an underlying pre-tax profit of A$367 million in the period against a loss of A$252 million in the same period a year earlier.

Qantas’s international operations reported underlying earnings [EBIT] of A$59 million, a turnaround of A$321 million and its first profits since the global financial crisis in 2008, while its domestic business reported earnings up by A$170 million to A$227 million.

The half year results were boosted by a faster than expected implementation of a four year A$2 billion cost cutting plan that involves 5,000 job losses, early retirement of aircraft and wage freezes.

The ‘transformation benefits’ for the six months came in at A$374 million.

Lower depreciation costs following a writedown on the value of the Qantas fleet in August and the sharp fall in fuel prices also helped the airline report its best interim results since 2010.

The carrier said the outlook for the second half of its financial year had improved with overall demand described as being “stable”.

Chief executive Alan Joyce said: “The decisive factor in our best half-year result for four years was our complete focus on the Qantas transformation programme.

“It’s clear that without the impact of transformation, we would not be announcing a profit today.

“Our people have worked hard and made a huge contribution to bring about the change we need. They deserve great credit for this result.

“What sets this transformation apart is that we are reducing costs permanently while at the same time delivering Qantas’ best ever fleet, product and service.

“We are meeting or exceeding all our targets as we build a sustainable future for Qantas with an emphasis on growing long-term shareholder value.

“Our financial position is significantly stronger because of the actions we’ve taken, and we are giving Qantas a solid foundation for growth in earnings.”


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