- Qantas CEO Alan Joyce said the billion dollar loss was ‘stark but not surprising’
- The loss was thanks to a $6.9 billion Covid-related loss on its half year results
- The airline said it has $4.2 billion in available cash to keep the airline afloat
- Mr Joyce said he expects international travel will resume at the end of October
- It is in-line with the date for Australia’s vaccine rollout to be effectively complete
PUBLISHED: 09:00 AEDT, 25 February 2021 | UPDATED: 10:22 AEDT, 25 February 2021
Qantas predicts international flights will return and Australia’s borders will be open by the end of October.
Resuming international flights can’t come soon enough for the Flying Kangaroo as it lost just over a billion dollars in six months.
The airline endured an underlying loss before tax of $1.03billion and a $6.9billion drop in revenue, noting the half-year results covered Victoria’s extended Covid lockdown and nationwide border closures.
The group’s statutory loss before tax was $1.47billion, which included further redundancy and restructuring costs of $284million, coming on top of the $642million provided in its 2020 full year results.
It also included a further $71million writedown of the A380 fleet, in line with its Australian dollar market value.
Qantas CEO Alan Joyce said he foresees international travel resuming at the end of October, in-line with the date for Australia’s vaccine rollout to be effectively complete.+4
- Qantas CEO Alan Joyce said he foresees international travel resuming at the end of October+4
- Qantas CEO Alan Joyce said he foresees international travel resuming at the end of October
‘Our priorities remain the safety of everyone who travels with us, getting as many people back to work as possible and generating positive cash flow to repair the balance sheet,’ he said.
‘The Covid vaccine rollout in Australia will take time, but the fact it’s underway gives us more certainty.
‘More certainty that domestic borders can stay open because frontline and quarantine workers will be vaccinated in a matter of weeks.
‘And more certainty that international borders can open when the nationwide rollout is effectively complete by the end of October.’
Qantas anticipates its domestic capacity will rise to 60 per cent of pre-Covid passenger levels in the third quarter, and to 80 per cent in the fourth quarter of 2021.
Mr Joyce hopes domestic travel will return some semblance of normalcy once premiers put an end to snap border closures as more Australians get vaccinated.
‘We’ve had very positive conversations this week with several premiers and chief ministers about how to restore confidence in borders as quickly as the health advice allows,’ he said.
‘Could we reach that point as soon as April? We think an assurance like that is worth pursuing – because it would accelerate the recovery in key parts of the economy and give many businesses, not to mention friends and families, instant certainty.’
Mr Joyce said the airline’s billion dollar loss was ‘stark but not surprising’.
‘During the half we saw the second wave in Victoria and the strictest domestic travel restrictions since the pandemic began,’ he said.
‘Virtually all of our international flying and 70 per cent of domestic flying stopped, and with it went three-quarters of our revenue.’
international borders open up.+4
Mr Joyce hopes domestic travel will return some semblance of normalcy once premiers put an end to snap border closures as more Australians get vaccinated
Qantas said it has $4.2 billion in available cash to keep the airline afloat until domestic travel returns to pre-Covid levels and international borders open up
Mr Joyce said Qantas Loyalty program still generated a strong cash contribution of $454million as the vast majority of points are earned from activity on the ground, while Qantas Freight had a record result because a lack of international passenger flying created a shortage of cargo space globally.
‘These factors couldn’t overcome the massive impact of the crisis, but they have softened it,’ he said.
Mr Joyce said despite huge challenges, he believes the results show the group’s underlying strength.
‘When we had the opportunity to fly domestically, we saw significant pent-up travel demand and generated positive cash flow,’ he said.
Qantas said federal government assistance, such as JobKeeper, has helped the airline through the profound impact of the travel restrictions, as have support for regional, domestic and some international flights that helped to keep key transport links active.