The Flying Kangaroo, Qantas is back in black, after earning an underlying profit of $367 million and statutory profit of $206 million for the six months to December 2014.
The result is a $619 million improvement over the same period the prior year.
Chief executive Alan Joyce said growth met and exceeded the company’s targets and attributed success to the airline’s $2 billion transformation program.
Cheers to profits! Qantas Alan Joyce earlier this year opening the airline’s first upgraded A330.
The transformation program launched in 2013 and included the consolidation of Australian call centres, job losses around the company’s business, plus major fleet and network changes.
The airline has also reduced the fleet age to the youngest it has been in 20 years and simplified aircraft from eleven to nine different types.
A reduction in fuel prices also saw the airline save some $33 million and the removal of the carbon tax helped drive profits up by $59 million.
“What sets this program apart is that we are reducing costs permanently, while at the same time delivering Qantas’ best ever fleet, product and service.”
Alan Joyce, Qantas Chief Executive
The airline boss said he believes the airline is now in a strong position for ‘sustainable growth’ and expects to meet profit goals by the end of the financial year.
For the first time since the GFC, Qantas International was profitable, with an underlying earning of $59 million – a turnaround of $321 million over the same six months to 31 December 2013.
Joyce expects all areas of the business to be profitable by the end of the financial year.
So far, Qantas’ domestic business has reported an improvement of $170 million compared to the same six months the prior year. This is ‘well over the halfway’ mark to reach profitability of just under $300 million for 2014/15 financial year.
The Jetstar Group saw its underlying earnings for the six months to 31 December 2014 reach $81 million – an improvement of $97 million year-on-year.
Domestically, Jetstar achieved earnings of $63 million, which Mr Joyce said was driven by improved yields and loads, while Jetstar International earnings of $51 million were attributed to network restructure and the roll-out of the Boeing 787.
Mr Joyce said outlook for the rest of the financial year has improved, although demand for the domestic market is mixed, while international seems steady.
“We expect all operating segments to be profitable in the full year.”