Australia’s Qantas Airways announced its full year results, with net profit falling 17 percent as a one-off gain last year flattered the previous result.
In its financial year to end June, Qantas reported underlying pre-tax profit of AUD$1.4 billion, an 8.6 percent drop on 2016’s record result. Net profit came in at AUD$853 million, from AUD$1.03 billion the previous year.
In its financial report, Qantas pointed to the success of its three year turnaround programme and the resulting “significant improvement in financial performance”. The turnaround achieved its target of AUD$2.1 billion in benefits to the airline.
Chief executive Alan Joyce said Qantas will be “taking the energy and focus from the turnaround, and putting it into continuous improvement… to deliver AUD$400 million in benefits every year.” He said that process has already started.
Qantas carried 53.6 million passengers during the year, a 2 percent increase on the previous year. RPK (revenue passenger km) passenger traffic was also up 2 percent on an ASK (available seat km) capacity increase of 1 percent. Resulting revenue seat factor edged up 0.5 of a percentage point to 80.6 percent.
Unit costs rose by 1 percent, but unit revenue failed to keep up, with a 2 percent drop.
On costs, the Australian flag carrier said an 18-month wage freeze had helped to offset inflation and build a more competitive and sustainable wage position. It announced a AUD$2,500 bonus to non-executive full time employees, and AUD$2,000 to part time staff.
Looking forward, Qantas said it will further reduce domestic capacity in the first half of its 2018 financial year (by 1 percent), but overall group capacity, including international and Jetstar, will grow by 3 percent. Unit revenue is expected to increase in 1H18 on stronger demand.