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Qantas returns to black as turnaround takes effect

Qantas returns to black as turnaround takes effect

Qantas Group today reported an underlying profit before tax of $192 million, for the year ended 30th June 2013.

In a statement the airline group said the result demonstrated progress in its strategy against a challenging backdrop, with high fuel costs, excess capacity in the domestic market and intense competition in the international market.

Qantas Domestic, Jetstar and Qantas Loyalty were all profitable, while Qantas International halved its underlying EBIT losses.

The group’s comparable unit cost was improved by five per cent, reflecting cost reduction and productivity improvements.

Qantas Transformation initiatives delivered $171 million of strategic benefits over the course of the year, and a further $257 million in ongoing cost management to offset annual inflation.

The result reflects a number of positive and negative impacts to underlying profit before tax, the statement explained.

Negatives included the Dubai hub transition, the carbon tax, pilot back-pay and additional start-up losses in Jetstar’s new ventures in Asia.

Qantas Group chief executive Alan Joyce said the level of activity and achievement across the group over the past 12 months had been immense.

“We have launched a global partnership with Emirates - shifting our hub for Europe flights to Dubai - maintained our strong domestic market position with the Qantas-Jetstar dual brand strategy, continued building Jetstar in Asia, and achieved another record result with Qantas Loyalty,” he explained.

“The market is very tough.

“But we are focused on the elements we can control.

“We have Australia’s leading airlines and loyalty business – and we have a clear strategy to build an even stronger business for the future.”