Joyce and Evans lay out in it out in the March 14 2014 Senate hearing (Hansard Transcript). Routes were cash flow positive, yet these routes lost money once depreciation was taken into account. However, we now find out this depreciation figure was artificially inflated because the aircraft had an artificially high book value compared to actual value.
This book value could have been adjusted at any time, yet they chose not to. Why? because then the international operation would have been profitable once they did. Now, when the timing suits them for whatever reason, they adjust the book value with the stroke of a pen and QFI can now return to profitability.
FYSTI, I totally agree with you. QF management could have adjusted the book value a lot earlier but they obviously didn't want that and the only reason that a company's CEO would trash talk one of its divisions is because he wanted it to look bad. Joyce needed an excuse to cancel the Mainline A380 and B787 orders so that he would then have the cash to place the massive order of 110 A320's for all the Jetstar entities. If QF International continued to be profitable (it was prior to Joyce taking over) then the institutional investors would have reacted to any cancellation of orders - especially for the very fuel efficient B787's.
Apart from the book values now at a level that will allow routes to be profitable, the company still has to deal with the massive $11 billion debt that Clifford & Joyce have imposed on the airline.
