QANTAS MANAGEMENT: ADDING VALUE?
As a Qantas shareholder who has direct share holdings, and indirect holdings through managed funds, I have found some of the debate on this forum quite illuminating. It is easy to see why staff are disengaged, and I have to wonder if it is time for a shareholder revolt against those at the top? While they have delivered profit and produced good dividends, there has been little or no value added to shareholdings unlike most companies in the ASX200.
Why is management so engrossed with loss making enterprises instead of getting the Qantas brand right? How many millions were 'invested' in setting up Australia Airlines and now, how much is to be spent converting Australian Airlines to Qantas? Was the establishment of Australian a sound proposal?
How much has been so far invested in Jetstar Asia? Unfortunately not a lot is known about this millstone - seat factors aren't even published yet the Qantas shareholder is expected to put up and shut up. What would the losses have been at both Australian and Jetstar Asia if these companies were genuine stand-alone enterprises as much has been written here and elsewhere about Qantas providing a lot of support on a daily basis to these failures. Do they pay Qantas the full cost for these services that would have been paid if purchased elsewhere?
Maybe this is an inherent defect with Australian company law in that little detail has to be released about subsidiaries of listed companies but that said, the operating health of all the subsidiaries should be made known in the same way as the holding company.
Is there anyone here who can shed light on these questions that I would like to see put to Jackson and Dixon at the next AGM, or who can provide some ammunition for other questions that could be raised?
1. How much did it cost Qantas to paint 5 767's for Australian Airlines, and what is the cost now of having to paint them in Qantas livery?
2. What was the cost of putting the all economy seats to the Australian Airlines aircraft and what is now the cost of converting them back to Qantas standards?
3. What was the cost of the recent Australian Airlines uniform change and within but a few monthgs are being ditched to kit the crew in antas uniform?
4. How much was spent ferrying aircraft from Australia and Singapore during the time when Jetstar Asia scaled down its operations?
5. What is the daily aircraft utilisation at Australian Airlines and Jetstar Asia, and how do these rates compare with industry standards?
6. What are the cumulative losses of Australian Airlines and Jetstar Asia?
7. Would the Qantas bottom line have been better off were these two losses makers not set-up?
In view of the hefty bonuses and options those at the top of Qantas receive, some emphasis has to be put on their performance, and quite often the views of the workforce are the best guide, and can show us about other not so public difficult investments and problems. Shareholders not only expect profit but they expect growth, and need to know whay a company can't deliver. Qantas has produced the former but not the latter. Is that a feature of airlines?
Let it all hang out in an objective manner.
Regards all,
Mel.