Qantas swings to FY profit

Airline's underlying profit jumps, declines to provide guidance for current year, pointing to 'challenging and volatile' climate.

By Staff Reporter ·
29 Aug 2013

Qantas (QAN) says the "high degree" of volatility and uncertainty in the domestic and international aviation markets, global economy and on the price of fuel is preventing it from providing full-year profit guidance, after underlying profit before tax beat analyst forecasts.

Qantas reported a full-year pre-tax profit, before significant items, of $192 million, way above market expectations for $76 million.

Net profit at the airline came in at $6 million for the year to June, from a $245 million loss in the prior year, largely on a paring of restructuring costs and impairments.

Underlying profit jumped to $192 million in the period, from $95 million.

Revenue increased by 1% to $15.9 billion, from $15.72 billion in the prior year.

It has not declared a final dividend.

Qantas chief executive officer Alan Joyce said the operating environment for the airline remained "challenging and volatile" in the first half of the current year.

"No group profit guidance is provided at this time due to the high degree of volatility and uncertainty in the competitive environment, global economic conditions, fuel prices and foreign exchange rates," Mr Joyce said.

Group capacity was expected to grow by 1% to 2% in the first half of 2014, compared to the previous corresponding period, with domestic capacity tipped to increase by up to 2.5 per cent.

Qantas pared underlying EBIT losses for its international division to $246 million in the year to June, from $484 million in the previous corresponding period. Domestic earnings took a hit, falling 21% to $365 million, from $463 million, while Jetstar earnings dived 32 per cent to $138 million, from $203 million.