Celebrations will be taking place across Qantas today after the Flying Kangaroo reported a record $1.6 billion underlying profit before tax during the 2017/18 financial year.
Healthy levels of demand across the entire Qantas network led to the record-breaking figure, which is $200 million (or 14 percent) more than the previous financial year.
The group experienced a strong performance on its domestic network, with earnings before interest and tax (EBIT) reaching $1.1 billion, 25 percent higher than the last year. This was achieved through initiatives such as refitting Jetstar’s A320s to carry more capacity, investing in new lounges and wi-fi on Qantas aircraft, as well as attracting new small-to-medium corporate customers.
Meanwhile, those new 787s, direct flights to London and additional trans-Tasman flights with Emirates helped boost Qantas International‘s earnings by seven percent to $399 million.
Leisure demand played a large role in Jetstar’s success this year and even resulted in the low-cost carrier carrying 24 million passengers around Australia and overseas for under $100.
Bargain!
Despite disruptions caused by the Bali volcano throughout the 12-month period, the Group said Jetstar International still managed to post a strong profit thanks to new routes like Melbourne-Ho Chi Minh.
The Qantas Group said due to such strong results; it will return up to $500 million to shareholders. This comprises an increased, fully franked dividend of 10 cents per share to be paid on 10 October 2018 with a record date of 6 September 2018, as well as an on market buy-back of up to $332 million.
Additionally, the carrier has set aside money to reward its people with a bonus. This will bring the total amount set aside for non-executive employees to over $300 million over the last four years.
Chief Executive, Alan Joyce, said the record profit reflected a healthy market, the benefits of ongoing work to improve the business such as investment in wi-fi and domestic sales fares, as well as staff.
“Ultimately our success relies on the great service and dedication to safety from our people, which is supported by continuing to invest and innovate.”
Alan Joyce, Qantas Group Chief Executive
“This record result comes despite higher oil prices,” he said. “We’re facing another increase to our fuel bill for FY19, and we’re confident that we will substantially recover this through a range of capacity, revenue and cost efficiency measures, in addition to our hedging program.”
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