Qantas flies high with near-$1 billion profit

Qantas flies high with near-$1 billion profit

Qantas has posted a $975 million pre-tax profit for the 2014-2015 financial year this morning, representing a $1.6 billion turnaround from just one year ago.

Every arm of the Qantas Group has listed squarely in the black, including the international division which had in the past represented the largest drag among the red-tailed teams.

Qantas International chalked up a full-year profit for the first time since the global financial crisis with an underlying pre-tax profit of $267 million, while Qantas Domestic listed a $480 million profit.

The Jetstar Group added another $230 million to the tally, up from a loss of $116 million in the previous financial year, with Qantas opting to write off its failed Jetstar Hong Kong operation.

The Qantas Frequent Flyer scheme poured a further $315 million into the Flying Kangaroo's pouch.

Also read: Qantas to buy Boeing 787, first flights from 2017

Those sky-high numbers come only 12 months after Qantas slumped to a record $2.8 billion loss.

While most of that was driven by a write-down in the value of Qantas' international fleet, the actual underlying loss of $646 million remained the biggest fall in Qantas’ modern history since the airline was privatised almost two decades ago.

Driving what is arguably the largest turnaround in Australian corporate history?

An extensive and still-underway cost savings program designed to strip out $2 billion in costs by 2017, which unlocked a whopping $894 million in the 2015 financial year alonelower fuel costs, which added some $461 million back to the bottom line; and the end of a gruelling capacity war on the domestic front with Virgin Australia.

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David Flynn
David Flynn is the editor of Australian Business Traveller and a bit of a travel tragic with a weakness for good coffee, shopping and lychee martinis.
 

22 comments

  • Rod Harmer

    Rod H

    20 Aug, 2015 08:11 am

    It's amazing what cunning accountants can do with financial reports. With the stroke of a pen they can turn huge losses into huge profits . IMHO there's some very tricky figuring being done !!!!!

     

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  • riley

    riley

    20 Aug, 2015 08:52 am

    Balance sheets don't lie!

    No member give thanks

  • Rod Harmer

    Rod H

    20 Aug, 2015 08:57 am

    That depends entirely upon who makes them up and the skill of the juggler !!!!!!!!!

    No member give thanks

  • Bizflyer

    Bizflyer

    20 Aug, 2015 04:32 pm

    Tesco's did

    No member give thanks

  • CityRail

    CityRail

    20 Aug, 2015 10:51 am

    That's basically what a CEO will do when they decide to get their company to have a big bath in the previous year so they can brutally cut as many staff as they like, then turnaround in a year or two to show how good they are and increase their bonuses and pay.

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  • Robbie Anderson

    wozzlegummich

    20 Aug, 2015 09:21 am

    Tenacious little bugger, isn't he.

    No member give thanks

  • Yohy

    Yohy

    20 Aug, 2015 09:28 am

    So it cost 2.8bil to make 1 bil? Hope they keep it up for the next few years to make back the rest of the loss and Joyce continues to forgo his bonus...

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  • fxdxdy

    fxdxdy

    20 Aug, 2015 10:08 am

    23c share holder distribution - employee bonuses - buying airplanes, it looks like it is raining money over there at Qantas:  http://www.qantasnewsroom.com.au/media-releases/qantas-announces-505-million-shareholder-distribution/ 

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  • jet_setter

    jet_setter

    20 Aug, 2015 10:47 am

    Alan Re-Joyce! ;) Woo Hoo, GO QANTAS! 

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  • JoeA350

    JoeA350

    20 Aug, 2015 11:05 am

    New routes are required to avoid stagnation!

    Sydney - Beirut is an important destination that Qantas can profit on.

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  • JoeA350

    JoeA350

    22 Aug, 2015 01:03 pm

    Why so many dislikes? Because we are living in a racist society?

    For those who actually do not know, Qantas did once upon a time service Beirut.

    Rome and Athens should also be added to the list of destinations, along with Paris and a return to Germany.

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  • AARON EISENBERG

    eisen100

    20 Aug, 2015 11:29 am

    To make any new route profitable you need to carry cargo on top of passanger. To Beirut you need at list 50,000 passangers a year and cargo to justify the route.

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  • AARON EISENBERG

    eisen100

    20 Aug, 2015 11:31 am

    Excuse my English. I meant of course at least 50,000 passangers and cargo to make it profitable - any new international route for that matter.

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  • Lotus Junior

    Lotus Junior

    20 Aug, 2015 11:33 am

    Wouldn't it be more comfortable to put the cargo in the hold?

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  • AARON EISENBERG

    eisen100

    20 Aug, 2015 11:40 am

    A 787-9 can carry up to 47 tons of cargo. Minimum three times a week you can figure out how important is to fly to a destination, not just carry business travellers but import/export of goods.

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  • AARON EISENBERG

    eisen100

    20 Aug, 2015 11:43 am

    That is why Qantas flies only to destinations Australia has enough trade with and business to justify a premium service. For a vacation destination Jetstar will do.

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  • AARON EISENBERG

    eisen100

    20 Aug, 2015 11:53 am

    Only carriers like Emirates who are heavily subsidised directly and indirectly by their state owners can even fly an a 380 to minor destinations with hardly any business travellers and cargo to justify it financially. They have other routes to compensate for some of these routs. Qantas and alike must make a profit on each international destination or not fly over there at all.

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  • JoeA350

    JoeA350

    20 Aug, 2015 12:02 pm

    Hi Aaron,

    In regards to your comment I totally agree. Hence why I said season flights!

    http://www.dailystar.com.lb/News/Lebanon-News/2008/Aug-20/54568-30000-australians-invade-lebanon-for-a-summer-visit.ashx

    See the link above, those figures have only increased

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  • highflyer

    highflyer

    20 Aug, 2015 01:43 pm

    Imagine their profit if they hadn't gone and invested in Jetstar HK.....

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  • Dejan Narat

    DCW

    20 Aug, 2015 03:19 pm

    Well Said

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  • Chris_PER

    Chris_PER

    20 Aug, 2015 01:54 pm

    Let me guess, Alan Joyce and his board are suddenly heroes.....So they should be making a profit when the cost of oil plummets.

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  • Ozshanel

    Ozshanel

    20 Aug, 2015 11:30 pm

    Sooo... why is Virgin not making a profit?  Speaks volumes about the mis-management going on there me thinks.

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Guest

21 Jul, 2019 10:35 am

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