The Australian aviation titan, Qantas Group, today unveiled its astounding financial rebound by posting a profit for the first time since FY19. After bearing the brunt of the COVID-19 storm for three long years, the airline behemoth has navigated its way back into the black with a profit of $2.47 billion before tax.

This sensational turnaround echoes the success story of David battling Goliath as Qantas, reeling from $7 billion in accumulated statutory losses over the past three years, emerges victorious.

The return to profitability can be attributed to the successful execution of the Group’s $1 billion COVID recovery initiative, an impressive 132% flight surge compared to FY22, and a rising travel demand tide, bolstering their revenue streams.

Major Highlights

• Colossal Profits: The Qantas Group proudly reported a staggering Underlying Profit Before Tax of $2.47 billion and a Statutory After Tax Profit of $1.74 billion. This robust achievement contrasts the $7 billion loss over the past three years.
• Covid Recovery Milestone: The company’s commendable completion of its $1 billion recovery initiative, marking a 132% surge in flying since FY22, has been a linchpin in these gains.
• Employee Rewards: In an awe-inspiring move, Qantas has allocated around $340 million to reward its workforce. This includes up to 1,000 shares for over 21,000 non-executive staff, amplifying the sense of pride and loyalty among its team.
• Fleet Expansion & Sustainability: Qantas has set the global stage abuzz with the announcement of orders for 24 state-of-the-art widebody aircraft. This includes 12 Boeing 787s and 12 Airbus A350s, revamping its fleet and ushering in an era of sustainable aviation.

Performance Metrics

Domestic and international segments have experienced phenomenal growth:

• Domestic Prowess: Domestic operations, encompassing Qantas, QantasLink, and Jetstar, soared to 103% of pre-COVID levels, capitalizing on robust travel demand and contributing an Underlying EBIT of $1.5 billion.
• Global Ambitions: Qantas’s international operations grew from 54% to 81% of pre-COVID levels, backed by the revitalization of seven Airbus A380s and new acquisitions.
• Freight and Loyalty: Qantas Freight and Qantas Loyalty have chipped in significantly, achieving a record Underlying EBIT of $451 million and increasing its membership base to 15.2 million.

Revitalizing the Skies:

Qantas Group, this year, demonstrated its operational prowess, outperforming other major domestic airlines for 11 months straight and witnessing Jetstar regaining its pre-Covid stature. And while customer satisfaction still has some catching up, it has improved considerably.

Gearing Up for the Future:

Based on newfound financial strength, Qantas has announced a massive order for 24 new widebody aircraft, with a mix of Boeing 787s and Airbus A350s. This robust investment aims to revamp and replace the aging A330 fleet by FY27.

Financial Stability & Returns

With liquidity sources nearing $10 billion and net debt dwindling to $2.89 billion, Qantas’s financial strength is unmatched. This fiscal stability has propelled the board to green-light a whopping $500 million share buy-back, scheduled for commencement in September 2023.

The Road Ahead

Looking forward, Qantas envisages a promising FY24 with over $1 billion in recurring cost benefits from its recovery program. With plans to further transform and invest, the company is poised to solidify its position as a global leader in the aviation sector.

Green Skies Ahead:

In a pivotal environmental move, Qantas, in partnership with Airbus and Boeing, will secure access to a staggering 500 million litres of Sustainable Aviation Fuel (SAF) annually from 2028. This initiative aligns with the airline’s vision of reducing carbon footprints, targeting 10% of its total fuel needs by 2030 with SAF.

A Gratitude Gesture:

The skies seem to be clear and generous for Qantas frequent flyers as the airline has launched an offer of over 1 billion bonus points and slashed fares. This is a small token of their appreciation and commitment to elevating the customer experience.

Employee Morale – Sky High!

Qantas Group acknowledges the pivotal role its workforce played in this magnificent turnaround. Approximately $340 million has been earmarked for bonuses, benefiting over 21,000 employees. This gesture is a nod to the relentless spirit of Qantas employees who steered the airline through the pandemic’s turbulent times.

CEO’s Take:

A jubilant Qantas Group CEO, Alan Joyce, articulated, “Flight operations have mostly reverted to pre-COVID standards, marking our transition from substantial losses to robust profits and future investments.”

He added, “We’ve increased our flight capacity by almost 70 billion seat kilometres and transported 46 million passengers – twice the previous year’s figures.”

Alan Joyce, CEO of Qantas Group, reflected, “This year signifies a monumental shift from challenging times to an era of profitability and tremendous growth. Our robust travel demand, introduction of new routes, and exemplary service delivery have been instrumental. I’m especially proud of our workforce, who have weathered the storm and are the real heroes of this success story.”

 

 

 

Written by: Octavia Koo

 

 

 

 

 

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