Qantas today announced its strongest profit since before the Global Financial Crisis and an order for eight B787-9 aircraft, to be delivered from calendar year 2017 to gradually replace five older B747s to start a “new era” for Qantas International.
For the 12 months to 30 June 2015, Qantas reported an Underlying Profit Before Tax of $975 million and a Statutory Profit Before Tax of $789 million. The underlying result is a turnaround of $1.6 billion compared with financial year 2014, including Qantas’ best ever second half performance, with all segments of the Qantas Group reporting robust profits and returning their cost of capital.
Qantas Freight reported record Underlying EBIT of $114 million, compared with $24 million in financial year 2014, driven by transformation benefits of $38 million and high load factors. The business renewed Australia Post as its biggest domestic freight customer as well as adding a new major customer, Toll Group.
The carrier said the driving force behind the Group result was progress with the Qantas Transformation programme, which realised $894 million in transformation benefits during the year and saw Qantas meet its target of paying down more than $1 billion in net debt. As a result, Qantas has reached its optimal capital structure – enabling it to resume shareholder returns while continuing to invest in growth and renewal.
Chief executive Alan Joyce said the milestone acquisition of the next-generation Dreamliner for Qantas International marked the scale of Qantas’ turnaround and signaled a new phase of renewal and growth.
“We are halfway through the biggest and fastest transformation in our history,” Joyce said. “Without that transformation, we would not be reporting this strong profit, recommencing shareholder returns, or announcing our ultra-efficient Dreamliner fleet for Qantas International.
“We have reshaped our business for a strong, sustainable future – and because we moved quickly and made tough decisions early, we have strong foundations to build on.”
The Jetstar Group reported record Underlying EBIT of $230 million, up from a loss of $116 million in financial year 2014, driven by strong performances in the Australian domestic and Australian international market. Jetstar International achieved a record profit as it introduced more B787-8s into its fleet. Jetstar’s New Zealand business was also profitable and all the Jetstar-branded airlines in Asia (Jetstar Asia (Singapore), Jetstar Pacific (Vietnam) and Jetstar Japan), improved their performance compared with financial year 2014, with losses halved.
The outlook for the Qantas Group sees expected to increase by 3-4 per cent in the first half of financial year 2016 compared to the first half of financial year 2015. Group Domestic capacity expected to increase by 0-1 per cent in the first half of financial year 2016 compared to the first half of financial year 2015.
International capacity will also increase, driven by utilisation, new route launches and the B787-8 transition. Qantas said no Group profit guidance will be provided at this time due to the “high degree of volatility and uncertainty in global economic conditions, fuel prices and FX rates”.
