Qantas Soars to Record Half-Year Profit

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By Jacob Maslow

Qantas has posted a record pre-tax profit of $921 million Australian dollars for the six months leading to December thanks partly to falling oil prices.

The result is the Australian airline’s biggest first-half profit in its 95-year history.

The company’s half-year profit was $554 million higher than the same period in 2014, reflecting 151% increase. Qantas shares, however, declined 5% in early Sydney trading despite the announcement of a $500 million share buyback.

Analysts say investors were probably expecting more capital returns through dividends instead of share buybacks.

After reporting its biggest annual loss in 2014, the airline implemented changes aimed at boosting revenue and reducing costs.

“Without a focus on revenue, costs and balance sheet strength, today’s result would not have been possible,” chief executive Alan Joyce said on Tuesday.

The airline said plans to cut $2 billion worth of costs by the end of next year are on track, with over $1 billion worth of debt removed from the balance sheet and 4,500 out of 5,000 jobs already cut.

Qantas said it will not be giving any annual profit guidance due to “industry and economic dynamics”.

Meanwhile, the airline said that passengers will soon be enjoying faster WiFi on its flights.

Qantas said it partnered with ViaSat for the upgrade of its in-flight Internet access offering. The planned upgrade will reportedly bring up to 10X faster internet connection than conventional on-board WiFi.

Trials are set to begin in late 2016, and will be followed by a full roll-out across Qantas Domestic’s fleet of A330s and B737s in 2017.

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