Everyone can see the HUGE depreciation/amortization costs associated with the failing mainline.
Qantas has leased 9 A330's to Jetstar Intl Ops.
Qantas has leased 5 A320's to Jetstar Dom Ops.
A330-200's have a list price of $200million.
A320's have a list price of $85million
Depreciation is over 20 years in Qantas.
If Jetstar had to pay the depreciation 'costs' on their balance sheet, of the A330's roughly 9 x $10million = $90 million / year the underlying EBIT looks a bit sad.
If Jetstar had to pay the depreciation 'costs' on their balance sheet, of the A320's roughly 5 x $4.25million = $21 million / year the underlying EBIT looks even sadder.
$169million - $111million = $58million If the same standards of depreciation were applied to the Jetstar balance sheet as they are to the Qantas balance sheet.
I don't claim any level of accuracy here please point it out to me if I'm wrong, I'm happy to be corrected.
Of course it makes sense to put the aircraft on the balance sheet for depreciation purposes on the side of the group which benefits the group as a whole I don't dispute that, I do dispute if the above is the case and it's being used as an industrial tool to drive down wages.