Qantas reports a 28 per cent rise in net profit as boss Vanessa Hudson says the company will “learn from” the fallout of its unlawful outsourcing of ground handling.<\/p>\n
This morning, shareholders initially reacted positively to Qantas’ first-half profit result, with the company’s share price jumping 4 per cent, but that early enthusiasm quickly faded.<\/p>\n
A little after midday, its share price was trading around $9.98 a share (-6.34 per cent).<\/p>\n
“The market has struggled to digest the misses on underlying profit before tax and statutory net profit after tax (both below consensus), combined with management highlighting rising airport charges, government fees, and other costs outpacing inflation \u2014 raising questions about future margin sustainability,” IG analyst Tony Sycamore said in a note.<\/p>\n
Statutory profit includes costs attributed to Jetstar Asia’s closure, organisational restructuring, management of a cyber incident, legal penalties, and employee ownership plan awards.<\/p>\n
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Qantas touts ongoing fleet renewal<\/p>\n
When announcing the profit result this morning, Qantas Group chief executive Vanessa Hudson said the airline is still investing in the largest fleet renewal in its history, which has helped to drive the group’s recent financial performance.<\/p>\n
“Around 60 per cent of Jetstar’s increase in profitability in the half was driven by its new aircraft,” she said.<\/p>\n
“This gives us confidence in the benefits that will flow once Qantas’ new aircraft reach scale.<\/p>\n
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Vanessa Hudson says Qantas’ new aircraft are helping to drive the group’s financial performance. (ABC News: John Gunn)<\/p>\n
“We’ve already started to see an acceleration in deliveries for Qantas, with six new aircraft arriving in the first half and a further 30 arriving over the next 18 months.<\/p>\n
“Some of these new aircraft will replace older aircraft, while some will support growth by opening up new routes, like the ultra-long range A350s, which will operate Project Sunrise flights<\/a>.<\/p>\n “[We] are also increasing returns to shareholders. The Board has approved a $300 million fully franked base dividend, an increase of $50 million, along with a [$150 million] share buyback,” she said.<\/p>\n Penalties paid for illegal outsourcing, state of US economy being monitored<\/p>\n Qantas’ operating cash flow was down 15 per cent (-$321 million) to $1.75 billion in the half, year-on-year.<\/p>\n That was due to increased tax outflows and $90 million in legal penalties for illegally outsourcing its ground handling workforce<\/a> during the COVID pandemic.<\/p>\n Qantas fined $90 million for illegally outsourcing jobs<\/a><\/p>\n The airline giant will face a $90 million penalty over its decision to illegally outsource more than 1,800 ground handling jobs during the COVID pandemic.<\/p>\n The airline said the “gross impact” of the Albanese government’s “Same Job, Same Pay<\/a>” laws on the airline’s wage costs in financial year 2026 was approximately $95 million, but that impact was “expected to mitigate over time”.<\/p>\n Looking forward, the airline said it expected strong travel demand across its portfolio, with caveats.<\/p>\n “The evolving economic environment in the US will continue to be monitored,” it said.<\/p>\n Qantas’ Group Domestic unit delivered $1.05 billion in underlying EBIT (earnings before interest and taxes), up 14 per cent. Its domestic revenue grew by 5 per cent, supported by a 4 per cent increase in capacity.<\/p>\n Six new aircraft arrived in the half, including A321XLRs, which entered service in September. It says that as more aircraft enter the fleet, they will enable the planned retirement of the airline’s older Boeing 737s, beginning in late calendar year 2026.<\/p>\n It says QantasLink also benefited from fleet renewal, with more mod-life A320 and A319 aircraft supporting 10 per cent capacity growth across intra-WA.<\/p>\n Jetstar a stand-out<\/p>\n Jetstar’s domestic operations beat expectations.<\/p>\n Jetstar carried more than 8.5 million passengers in the half, which helped it deliver a 38 per cent increase in underlying EBIT, with more than half of Jetstar’s customers flying for less than $150.<\/p>\n