Aviation

Qantas suffers $1.9bn loss, with international flights “unlikely” before July 2021

Huntley Mitchell

Huntley Mitchell

Qantas Group has taken a huge financial hit from the COVID-19 pandemic, revealing a net loss of $1.9 billion in FY20.

The statutory loss was a big swing away from the $891 million profit Qantas posted a year earlier, while the group reported a $124 million underlying profit before tax for the 12 months to 30 June 2020 – down 91 per cent on the prior year.

Overall revenue dropped 21 per cent to $14.2 billion, with a $4 billion revenue fall occurring in the second half of FY20 due to the COVID-19 crisis and associated border restrictions.

Qantas Group’s loyalty business suffered the biggest decline in revenue – down 26 per cent – while Jetstar’s revenue fell by 24 per cent, Qantas’ domestic revenue fell by 23 per cent, and Qantas’ international and freight division saw an 18 per cent slide in revenue.

Alan Joyce, CEO of Qantas Group, said the second half of FY20 was the toughest set of conditions the national carrier had faced in its 100 years, but that it had the resilience to deal with them.

“The impact of COVID on all airlines is clear. It’s devastating and it will be a question of survival for many,” he said.

What makes Qantas different is that we entered this crisis with a strong balance sheet, and we moved fast to put ourselves in a good position to wait for the recovery.

“We’ve had to make some very tough decisions in the past few months to guarantee our future. At least 6,000 of our people will leave the business through no fault of their own, and thousands more will be stood down for a long time.

“Recovery will take time and it will be choppy. We’ve already had setbacks with borders opening and then closing again.

“But we know that travel is at the top of people’s wish lists and that demand will return as soon as restrictions lift. That means we can get more of our people back to work.

“COVID is reshaping the competitive landscape and that presents a mix of challenges and opportunities for us. Most airlines will come through this crisis a lot leaner, which means we have to reinvent how we run parts of our business to succeed in a changed market.”

Joyce said the FY20 result showed how the COVID crisis had derailed what would have been a strong financial performance for Qantas.

“We were on track for another profit above $1 billion when this crisis struck,” he said.

“The fact that we still delivered a full-year underlying profit shows how quickly we adjusted when revenue collapsed.

“Qantas Loyalty’s profit was down less than 10 per cent and member satisfaction increased in the fourth quarter, which shows the strength of that business.

“Qantas Freight has been a major beneficiary of the shift to people shopping online and our charter flying for resources companies is strong.”

Joyce said COVID-19 will continue to have a huge impact on the company, and expects a significant underlying loss in FY21.

“Looking further ahead, we’re in a good position to ride out this storm and make the most of the recovery,” he said.

“Our market position is set to strengthen as the only Australian airline with a full service and low fares domestic offering, as well as long-haul international services.”

Qantas noted that its international network was “unlikely” to restart before July 2021, but there is a “possibility” of trans-Tasman flights being revived earlier.


Featured image source: iStock/Katharina13

SEE WHAT PEOPLE ARE SAYING

Leave a Reply

Cruise

13 Parties charged over last December’s White Island tragedy

by Ali Coulton

The eruption resulted in 22 deaths with many still recovering from the traumatic event that occurred during a cruise ship excursion on the New Zealand Island last year.

Share

CommentComments

Hotels

Property owner scores early wins against Virgin Hotels, as lawsuit proceeds to trial

A juicy court case between Virgin Group’s hospitality arm and a disgruntled hotel owner has seen the latter chalk up a couple of early wins.

Share

CommentComments

Aviation

Joyce meets with Victorian Premier over Qantas’ potential HQ move, as thousands more jobs get the chop

Qantas’ chief has taken a spin around Melbourne’s Airport prescient to see if it fits the bill as the airline’s new headquarters, just before another big job cut announcement.

Share

CommentComments

Wholesalers

Excite Holidays payout to creditors estimated to be more than previously thought

by Huntley Mitchell

Were you one of the unfortunate ones caught up in the wholesaler’s collapse earlier this year? Consider this a ‘must read’.

Share

CommentComments

Travel Agents

Helloworld CEO expects “dramatically reduced” competition will lead to boom time for agencies

by Huntley Mitchell

Andrew Burnes has some seriously good expectations for Helloworld agents, thanks to a predicted lack of competition from rivals.

Share

CommentComments

Destinations

Visit Sunshine Coast unveils new brand tagline

It’s getting a new CEO, and now Visit Sunshine Coast has a new tagline, too. Rumour has it that the office biscuit tin is next in line for a shakeup.

Share

CommentComments

Tourism

REVEALED: All the winners of the World Travel Awards 2020

Find out the top destinations, hotels and airlines to book your clients with post-COVID right here.

Share

CommentComments

Aviation

British Airways is flogging its onboard dining sets and bar carts just in time for Chrissy

Unlike Qantas, British Airways is selling its bar carts empty, which leads us to believe it may have missed the point as to why passengers get excited when the bar cart comes around.

Share

CommentComments

Cruise

CLIA calls for cruise ban to be replaced by newly proposed measures

The association has been busy making sure the government sticks to its plan of lifting the cruise ban by 17 December by suggesting a range of safety measures.

Share

CommentComments

Wholesalers

Intrepid launches cyber sale on 2021 Aussie and New Zealand trips

Slide into your clients’ DMs with these whopping savings, so you can get their 2021 bookings in before the silly season is well and truly upon us.

Share

CommentComments

Destinations

South Australia set to open its border to Victorians

It looks like ScoMo’s plan for domestic borders to be open by Chrissy is well on track, with the crow-eaters finally letting those from the Garden State back over their side of the fence.

Share

CommentComments

Destinations

Rob Thompson named Tourism Fiji’s acting CEO

While the search for Tourism Fiji’s next leader is well underway, the organisation has revealed who will be keeping the CEO’s seat warm.

Share

CommentComments