Addendum
Air New Zealand and Qantas keep their shareholders happy
September 1st 2017
Qantas Airways continued to strengthen its balance sheet with the announcement that its latest full-year underlying profit was $1.4 billion (US$1.1 billion), its second best result in its 97-year history. Read More » But in a tough year for international business, profit declined by 17%, to $852 million (US$673.1 million), and passenger revenue was down 1% for the 12 months.
Qantas Group CEO, Alan Joyce, said: “All of the group’s divisions - Qantas and Jetstar domestic, Qantas and Jetstar international and its frequent flyer program - were in the black. Jetstar posted its second highest profit in 13 years, but said earnings fell by 8%, to $417 million, compared with 12 months ago.
Joyce confirmed he had written to Airbus and Boeing and challenged them to produce an airliner that could fly non-stop between Sydney and London and Melbourne and New York by 2022.
Joyce said he had asked the manufacturers to give their next-generation aircraft currently under development, Airbus’ 350ULR and Boeing’s 777X, the range to fly non-stop and with a full passenger load on the routes.
The strong Qantas results came a week after rival, Virgin Australia, posted a loss of $2.5 million for the year, a big improvement on the $32.4 million deficit of a year earlier and well ahead of forecast losses of $14.2 million.
Across the Tasman, Air New Zealand (Air NZ) reported a 17% drop in after tax profit, to $NZ382 million (A$351 million), but said the results were still the second best full year earnings in the airline’s history.
Air New Zealand CEO, Christopher Luxon, said: “This year Air New Zealand faced an unprecedented increase in the level of competition from some of the world’s largest airlines and effectively rose to the challenge.” There also was evidence that some overseas carriers were pulling back capacity, he said.
Based on current conditions and assuming an average jet fuel price of US$60 a barrel, the airline is aiming to improve on its 2017 earnings.
