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Qantas profit soars 83.8pc to US$913.9 million as sales rise 2.4pc
AUSTRALIAN flag carrier Qantas posted an 83.8 per cent net profit increase to A$1.02 billion (US$913.9 million) in FY2016/17, drawn on revenues of A$16.2 billion, which increased 2.4 per cent year on year.
The Qantas Transformation Programme continues to underpin profit increases, delivering A$557 million of benefits over the financial year - ahead of a targeted A$450 million, said the statement accompanying the results.
Fuel costs were reduced three per cent, it said, and the revenue increase reflected cost reduction and revenue generation initiatives in the programme.
As a result, Qantas raised the target of Qantas Transformation to A$2.1 billion in benefits delivered by the end of financial year 2016/17, up from A$2 billion.
Freight revenue fell nine per cent during the financial year to A$850 million while passenger sales were up three per cent to A$1.39 billion.
Qantas Freight reported underlying EBIT of A$64 million, down 44 per cent on last year.
"The result reflects difficult global cargo markets and the end of favourable legacy agreements with Australian Air Express, impacting yields. However, the business is well-positioned for the future," said the Qantas statement.
"New long-term deals with Australia Post and Toll, the country's two biggest freight customers, are in place in the domestic market," it said.
Qantas Freight said it is also pursuing new opportunities internationally, in particular on triangular Australia-China-US routes.
The Qantas fleet totals 303 aircraft. During 2015/16, it purchased six aircraft and reclassified one from assets held for sale back into the fleet: Qantas - two B717-200s, one Bombardier Q300 and one Fokker 100 - Jetstar, three B787-8s.
Qantas removed three aircraft from service in 2015/16 including two lease returns. These included two A330-200s and one B747-400.
The Qantas Group's scheduled passenger fleet average age is now 8.6 years, within the targeted 8-10 year range.
The record performance is a 57 per cent per cent improvement on financial year 2015. It means Qantas can resume dividend payments, reward 25,000 EBA-covered employees with a one-off cash bonus and continue investment, including extending wi-fi to Qantas?regional and international fleets and finalising the network and customer experience for the Qantas Dreamliner.
Total underlying EBIT in the domestic market - across both Qantas and Jetstar - was a record A$820 million, up A$191 million, and total underlying EBIT in the international division was A$722 million, up A$374 million.
Said CEO Alan Joyce: "Qantas expects to continue its strong financial performance in the first half of financial year 2017, in a more competitive revenue environment. We are focused on preserving high operating margins through the delivery of the Qantas Transformation Programme, careful capacity management, and the benefit of low fuel prices locked in through our hedging."
The Qantas Transformation Programme continues to underpin profit increases, delivering A$557 million of benefits over the financial year - ahead of a targeted A$450 million, said the statement accompanying the results.
Fuel costs were reduced three per cent, it said, and the revenue increase reflected cost reduction and revenue generation initiatives in the programme.
As a result, Qantas raised the target of Qantas Transformation to A$2.1 billion in benefits delivered by the end of financial year 2016/17, up from A$2 billion.
Freight revenue fell nine per cent during the financial year to A$850 million while passenger sales were up three per cent to A$1.39 billion.
Qantas Freight reported underlying EBIT of A$64 million, down 44 per cent on last year.
"The result reflects difficult global cargo markets and the end of favourable legacy agreements with Australian Air Express, impacting yields. However, the business is well-positioned for the future," said the Qantas statement.
"New long-term deals with Australia Post and Toll, the country's two biggest freight customers, are in place in the domestic market," it said.
Qantas Freight said it is also pursuing new opportunities internationally, in particular on triangular Australia-China-US routes.
The Qantas fleet totals 303 aircraft. During 2015/16, it purchased six aircraft and reclassified one from assets held for sale back into the fleet: Qantas - two B717-200s, one Bombardier Q300 and one Fokker 100 - Jetstar, three B787-8s.
Qantas removed three aircraft from service in 2015/16 including two lease returns. These included two A330-200s and one B747-400.
The Qantas Group's scheduled passenger fleet average age is now 8.6 years, within the targeted 8-10 year range.
The record performance is a 57 per cent per cent improvement on financial year 2015. It means Qantas can resume dividend payments, reward 25,000 EBA-covered employees with a one-off cash bonus and continue investment, including extending wi-fi to Qantas?regional and international fleets and finalising the network and customer experience for the Qantas Dreamliner.
Total underlying EBIT in the domestic market - across both Qantas and Jetstar - was a record A$820 million, up A$191 million, and total underlying EBIT in the international division was A$722 million, up A$374 million.
Said CEO Alan Joyce: "Qantas expects to continue its strong financial performance in the first half of financial year 2017, in a more competitive revenue environment. We are focused on preserving high operating margins through the delivery of the Qantas Transformation Programme, careful capacity management, and the benefit of low fuel prices locked in through our hedging."
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