Qantas has recorded a billion-dollar half-yearly profit after it had battled years of pandemic-induced losses.
The turn around was revealed by the airline and followed a $456 million loss for the previous 12 months.
An underlying profit before tax of $1.43 billion was recorded along with a statutory profit after tax of $1.0 billion. This figure is 49 per cent higher than its previous first-half record result achieved for the 2018 financial year.
Qantas’ net debt also declined to $2.4 billion, resulting in statutory earnings of 53.9 cents per share.
In total, the results marked a $2.7bn turnaround on the previous period.
Total revenue came in at just under $10bn, which was more than three times the figure for the first half of the last financial year.
Chief executive Alan Joyce said there were several factors behind the airline’s turn around.
“All of our segments and the details in the documents that we released today are some broad drivers of a financial point again,” he said.
“The first is travel demand, which remains very robust, particularly leisure travel. While interest rates and inflation are expected to hit discretionary spending at some point, we’ve yet to see any signs of that moving forward.
“In fact, the research shows that travel is one area that people want to prioritise over the next 12 months.”
Mr Joyce earlier said the result marked a “huge turnaround considering the massive losses we were facing just 12 months ago”.
“When we restructured the business at the start of Covid, it was to make sure we could bounce back quickly when travel returned,” Mr Joyce said.
“That’s effectively what’s happened, but it’s the strength of the demand that has driven such a strong result.”
Airline staff are also set to benefit from the surge with a round of travel credits released by the business.
“Our people have been absolutely central to our recovery and that’s why we’re so pleased to be in a position to reward them with up to $11,500 in cash and shares, and why we’ve given them another $500 in staff travel credit today,” Mr Joyce said.
“Returning to profit means we can get back to reinvesting for our customers, which is clear from the network, fleet and lounge announcements we’ve made, and from the Project Sunrise cabins we’re previewing.
“Importantly for our investors, this also sets us up to deliver long term shareholder value.”
However, he was quick to point out the boom hadn’t come without rising costs for the customer.
“Fares have risen because of higher fuel costs, but also because supply chain and resourcing issues meant capacity hasn’t kept up with demand,” Mr Joyce said.
“Now those challenges are starting to unwind, we can add more capacity and that will put downward pressure on fares.
“In terms of overheads, we expect the costs we’re carrying from the extra operational buffer will start unwinding from this half and into next financial year.”
Qantas said fuel costs were up 65 per cent compared to before the pandemic, while airfares had increased by 20 per cent since 2021.
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