Qantas set to return to the black
The Qantas Group says it expects to return to profitability on the back of the successful implementation of its business plan and lower fuel prices. It expects underlying profit before tax in the range of A$300 million (US$247 million) to A$350 million for the first six months of financial year 2015.
All operating segments of the Qantas Group are expected to be profitable in the first half (to December this year).
The Group said the strong turnaround in its financial performance is being driven by rapid progress with the A$2 billion accelerated Qantas Transformation programme announced 12 months ago. “To date, all targets under the programme have been either met or exceeded.”
After realising $204 million in Qantas Transformation benefits in the second half of financial year 2014, the Group is on track to realise at least $350 million in further benefits in the first half of financial year 2015.
It also expects to receive a A$30 million benefit in the first half from lower Australian dollar fuel prices.
Qantas CEO Alan Joyce said the Qantas Transformation programme was gathering pace and, with a more stable operating environment, benefits were flowing directly to the Group’s financial results.
“Today we confirm that Qantas is set to report its best first half result since 2010,” Mr Joyce said. “This demonstrates that the strategy we have outlined to transform our business is working. This is an improvement of over A$550 million compared with the first half last year, with Qantas Transformation being the primary driver of the turnaround.
“Qantas is 12 months into a three and a half year program, but these strong early results give us the confidence that we will continue to meet all the targets we have set. We are committed to completing the full, $2 billion program to ensure a sustainable, competitive position for the long term.
“Thanks to the hard work of our people, we are delivering the cost and revenue-focused initiatives needed to strengthen our business, without compromising the premium service that matters to our customers. As our recent announcements show, from new lounges to new routes and the upgrade of our A330 fleet, customers remain at the heart of our strategy.”
Qantas announces its first half results for the financial year 2015 on 26 February 2015.