Qantas expects to record a $300-350 million profit for the six months from July to December, CEO Alan Joyce revealed today, with all divisions of the airline – including its beleaguered international arm – tracking back into the black.
The pretax underlying profit would be Qantas' strongest performance in the second half of the calendar year (first half of the financial year) since 2010.
The result is largely driven by Qantas' cost-cutting and efficiency drive and bolstered by increased passengers and revenue following a cease-fire in the 'capacity war' between Qantas and Virgin Australia, along with the falling cost of jet fuel.
The transformation program alone is expected to return $350 million in cost savings in the six months to December 31, while lower fuel prices should keep an extra $30 million in the kitty.
Qantas Group CEO Alan Joyce said the overall result would represent an improvement of some $500 million against an underlying loss of $252 million over January-June 2014.
“This demonstrates that the strategy we have outlined to transform our business is working.”
“Qantas is 12 months into a three-and-a-half-year program, but these strong early results give us the confidence that we will continue to meet all the targets we have set,” Joyce said.
“We are committed to completing the full, $2 billion program to ensure a sustainable, competitive position for the long term.”
Virgin Australia is also tipping a return to pretax profit in the same July-December period, although the airline has yet to nominate a number.
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