Qantas sees delay to flying overseas
QANTAS has pushed back the expected resumption of international travel from July to October, as the airline posted a “stark but not surprising” $1.47bn statutory loss for the first half of the 2021 financial year.
The latest results show the air carrier also received $459m in JobKeeper payments, which was paid to thousands of employees that had been stood down as well as to subsidise wages of those still working.
CEO Alan Joyce noted the
heavy loss covered the period that included nationwide border closures triggered by Victoria’s second wave, which slashed domestic travel by 70 per cent while international travel stopped altogether.
Looking ahead the airline hoped to resume international flying in October rather than July, and expected to increase domestic capacity to 80 per cent of pre-COVID levels by mid-year.
Mr Joyce revealed the resumption of international travel was discussed in a meeting with the Prime Minister, Deputy Prime Minister
and Treasurer last week. He said the subject of domestic border closures had also been raised in light of the vaccine rollout, and he was encouraged by the response.
“We’ve had very positive conversations this week … about how to restore confidence in borders as quickly as the health advice allows,” Mr Joyce said.
“For instance, is there a stage in the vaccine rollout where national cabinet could declare that the need to resort to domestic border closures is virtually gone? Could we reach that point as soon as
April? We think an assurance like that is worth pursuing.”
Despite the challenges of the past year, Mr Joyce said the results showed the group’s underlying strength, with the frequent flyer program and freight business performing well.
Of the 8500 employees identified as surplus to the Qantas Group needs, more than 5000 had left the business. There were 14,500 working but 11,000 remained stood down.
Despite the challenges facing the airline, Qantas Domestic managed to generate
positive underlying cash flow of $71m, with depreciation and amortisation taking the figure to a loss of $407m.
Qantas’ underlying loss, which strips out redundancy charges and other one-off costs, came in at $1.03bn for the December half. This compares to a $775m profit for the same period a year earlier.
Qantas International recorded a loss of $549m in underlying earnings before interest and tax (EBIT), whereas Qantas Loyalty achieved a $125m EBIT, down 29 per cent on the 2020 half year.