Shares in Qantas jumped almost 10% yesterday as the airline’s stunning turnaround continues. The carrier has now flagged AUD 2 billion in benefits from improvements deriving from its ongoing business transformation .
Chief executive Alan Joyce says Qantas has held domestic market share at more than 63% per cent, telling the Sydney Morning Herald yesterday he saw that as “a great structural advantage that we don’t see changing”.
At an investors’ briefing yesterday, Qantas forecast its full year costs should be lower this financial year, since the price of fuel plummeted, saving the airline AUD 550 million.
Qantas also forecast AUD 2 billion in transformation benefits by 2017. The airline is on course to slice AUD 1 billion from its debt in the 2015 financial year. The business transformation is tipped to deliver over AUD 875 million in benefits by financial year 2015.
Joyce believes the airline is on track to deliver the biggest transformation in Australian corporate history. The carrier expects a resumption of dividends in the coming year – a prospect which will delight Qantas shareholders, though there are no firm promises. The airline last paid a dividend in 2009.
Qantas has so far cut 4000 of the 5000 jobs targeted by 2017 under its controversial cost-cutting plan.
Earlier this week, the airline reached an in-principle agreement for an enterprise bargaining agreement covering about 2000 domestic cabin crew. It includes an 18-month pay freeze.
Joyce added that Qantas and Jetstar are experiencing significant growth in the Asia-Pacific market.
Written by Peter Needham