Qantas’ $400m share buyback

New Qantas chief executive Vanessa Hudson has revealed a 13.2 per cent fall in half-year profit in her first financial results since taking over the top job.

For the six months to December 2023, Qantas made a statutory profit of $869m, down from the previous corresponding period’s $1bn, in a fall explained by greater investment in customer services and high fuel costs.

Qantas announced it will accelerate the rollout of high speed Wi-Fi on international flights as part of a suite of investment for customers. Major upgrades to digital platforms and the interior of new A220 aircraft were also revealed alongside the results.

Meanwhile, underlying profit slipped to $1.25bn, from $1.43bn in the first half of 2023, slightly above consensus estimates, on the back of a healthy 12.3 per cent increase in revenue to $11.13bn.

Qantas Domestic held its position as the biggest moneymaker for the group, with $641m in earnings, down from $785m in the 2023 first half.

Jetstar leapfrogged Loyalty and international to be the second most profitable segment of the group, increasing its earnings from $177m to $325m in the half on the back of strong demand for leisure travel.

Qantas Loyalty also saw its profits rise to $270m from $220m.

The group withheld a dividend, as in recent previous periods. But it announced a new on-market share buyback of $400m.

Delivering her first financial results as chief executive, Ms Hudson said there was much work happening to lift service levels.

“Having the financial strength to keep investing is key and that makes the strong performance that all business units had in the first half so important,” Ms Hudson said.

“We understand the need for affordable air travel, and fares have fallen more than 10 per cent since peaking in late 2022. At the same time, we’ve seen a cost benefit from fewer cancellations and delays and scale benefits as more international flying returns.”