Jetstar and FFP save Qantas mainline as operating losses touch AUD30 million a month

Qantas’ mainline flying business has gone from a AUD1.23 billion profit before tax to a AUD77 million loss in the space of 12 months. Were it not for a AUD126 million profit before tax from Jetstar (up 23.5%) and AUD310 million profit from its frequent flyer business (up 142%), the Group would have been deeply in the red. And more of the same is expected. With Qantas mainline losing up to AUD30 million a month, the airline still faces a toxic combination of “high levels of volatility in the economic outlook, industry capacity, passenger demand, fuel prices and exchange rates continue”, making it “not possible to provide any profit guidance”. [2615 words]

CAPA Members Login Username: Password: Remember details

Instantly get access to this article now for USD15.00. or If you've already bought this article, you can view it by typing your Article Key:

This report contains the following subheadings:

• Second half earnings rout
• Yields stabilise, but at low levels
• Segment review: AUD107 million Group loss in second half
• New AUD1.5 billion cost cutting programme announced
• Qantas mainline suffers…
• Record year for Jetstar in deteriorating market conditions  
• Success in the tough Japanese market
• Initial profits with domestic New Zealand operations
• 400,000 pax on trans-Tasman services
• Strengthening Singapore hub as it focuses on Pan Asian growth 
• And not forgetting about the Australian domestic market
• Blow for Boeing, more A330s for Jetstar long-haul
• Looking again to Europe 
• Qantas Frequent Flyer – star performer
• Outlook: No dividend, no guidance and not much positive

This report contains the following charts and tables:

• Qantas Group segment performance (AUD mill): 1HFY1009 vs 2HFY2009
• Qantas international and domestic yield growth (% change year-on-year): Jul-2008 to May-2009
• Qantas Group segment performance (AUD mill): FY 2008 vs FY2009
• Qantas profit before tax: 1999 to 2009
• Qantas net profit margin: 2005 to 2009
• Qantas passenger number growth and PLF: 2005 to 2009