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lowerlobe
16th Aug 2007, 01:32
Record earnings cap a turbulent year for Qantas


Danny John
August 16, 2007 - 10:40AM

Margaret Jackson said the past year had been an unsettling one for Qantas.
Photo: Andrew de la Rue
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Qantas capped a tumultuous year that included a failed $11b private equity bid for the airline, by declaring today a record pre-tax profit of $1.03 billion.

The result was a vindication of the airline's strategy to expand its international and domestic operations, but also underlined claims by major shareholders that the carrier was undervalued by the takeover bid that collapsed earlier this year.

Net earnings of $720 million was also a record for the company which has announced an on-market buy-back of around 10 per cent of its shares which when completed over the next few months will reduce the equity base by $1 billion.

This is expected to further underpin the share price of the company which up until the latest market turmoil has consistently outperformed the Airline Partners Australia consortium's offer of $5.45 a share.

Shareholders have also been rewarded with a fully franked ordinary dividend of 15 cents per share doubling the full year pay out to 30 cents per share, a rise of 36 per cent on the corresponding period last year.

As announced earlier this week, the profit figure includes a provision for an expected fine by US regulators of $47 million to cover the airlines alleged involvement in a fuel-surcharge price-fixing cartel by its freight division.

Outgoing Qantas chairman Margaret Jackson, who quits later this year after the controversy generated by the APA takeover bid, said the result had significantly improved the company's cash position. This now stood at $3.4 billion which provided enough surplus capital to make the share buyback possible and therefore reward shareholders further.

Qantas chief executive Geoff Dixon said the profit figure, and the underlying strong operating position, had been underpinned by its two airline brand strategy with JetStar replacing the main airline on many routes that have been previously unprofitable.

Following its launch in May 2004 JetStar was now making a pre tax profit of $112 million per annum, this is expected to increase further over the coming year as Qantas outlined further growth in profit for 2007/08 well in excess of today's result.

The airline has decided to grant $1,000 worth of shares and a cash bonus of $1,000 to all of its staff as a reward for their loyalty during a difficult but extremely profitable year.

Ms Jackson said the past year had been an unsettling one for Qantas employees but that the airline had now moved on from the takeover and was now concentrating on future growth.

In early trading, Qantas defied the market malaise to rise 1.7 per cent to $5.37.

Howard Hughes
16th Aug 2007, 02:12
Buy back? Or pay off for those people who supported the sale...:hmm:

Sunfish
16th Aug 2007, 04:30
Gee! Who wooda thought? A "legacy" airline, in the face of intense international competition from fiendish foriegn government owned airlines that simply drip with taxpayers money, a fuel bill that has increased stratospherically by $500 million last year..............and it still makes a record profit of $720 million?

That Qantas Board of Directors and the Senior Managment Team must be composed of superhuman geniuses to pull this off! What a virtuoso performance! Give all of them an AO!

How could anyone produce such a magnificent result given that the company was for sale as a wreck just a few months ago? Talk about Lazarus with a triple bypass....

This has to be the greatest company revival in the history of the joint stock corporation........

....or is it?

Enema Bandit's Dad
16th Aug 2007, 04:41
Welcome back Sunny old son! I think you'll find they're doing so well because Geoff Dixon has taken on board aircraft as his adviser. :eek:

RedTBar
16th Aug 2007, 04:42
Wow QF lists a record profit and sunfish returns....sunfish heard you missed out on the chairmans job?

Not to worry so did aircraft and the professor

"Talk about Lazarus with a triple bypass...." Funny about that because a lot of others thought exactly the same thing.

Fliegenmong
16th Aug 2007, 05:51
Sunfish ! Good to see you back!

EBD - That's very good, very very good.:D

The Kavorka
16th Aug 2007, 07:22
Jetstar make 112 million and win best LCC and best cabin crew (oz/nz)

go you good thing!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!:ok::ok:

lowerlobe
16th Aug 2007, 08:11
Is there any question this J* profit maybe an example of creating accounting?

As far as the award goes,well..mmmmmmm.

Best Cabin Crew mmmm

Keg
16th Aug 2007, 08:14
Outgoing Qantas chairman Margaret Jackson...said the result had significantly improved the company's cash position. This now stood at $3.4 billion which provided enough surplus capital to make the share buyback possible and therefore reward shareholders further.

Another report in the SMH said that this 3.4 billion is about 400 million in front of where the estimates where a while back. My question is why was this surplus being put aside and what would APA have done with it had they gotten hold of QF. :mad:

tail wheel
16th Aug 2007, 08:17
34.075 mill pax at approx $35 per pax fuel levy = $1.193 billion.

Nice little lurk!!

B A Lert
16th Aug 2007, 09:46
Jetstar International contributed a small profit of $3 million in its first year of operations (excluding start up costs).

Well, I'll be :mad: ! There'd be nothing like honesty to tell it how it is but as we have seen, that is expecting too much of some people. Have Jet* International no start up costs or are they simply too difficult (and frighteningly high) to accurately determine?

Let the spin continue.

toolish
17th Aug 2007, 03:53
28 Million start up cost, but hang on that can't be right Qf paid all those cost didn't they, Oh no that's right the cost was really 100 Million but they didn't want to put that much on the balance sheets:ugh:

QFinsider
17th Aug 2007, 04:07
You know the smartest guts in the room...No not Macquarie bank, Enron!!

The disgusting behaviour resulted in a piece of new legislation that has guys like Dixon worried...

The Sarbane-Oxley Act....

It is intended to disclose acconting practices that are less than honest and protect investors...
In a nutshell it relates to the presentation and availability of financial information.


"Jetstar make $112million"

Not quite sonny it takes a little more to start an airline from scratch and until very recently all information pertaining to transfer costs are conveniently hidden, it is merely an IR exercise, designed to convince people they NEED to be paid less.....

QF DRIVE
17th Aug 2007, 04:54
At the end of the day does it matter if QF paid $5 or $50 mil to set up Jetstar. Its the GROUP profit that counts. How much did Sunstate, QF link etc contribute ?

lowerlobe
17th Aug 2007, 05:10
QF DRIVE At the end of the day does it matter if QF paid $5 or $50 mil to set up Jetstar

Well,actually it does matter.If it costs more to set and run something than it makes then it's not really worth it.

Sunstate,QFLink etc...were not set up by Darth and were in fact up and running when he took over.

It would be interesting to find out the real stand alone costs of J* if QF were not around.Then and only then could you make a argument about J*'s viability and real purpose.

QF DRIVE
17th Aug 2007, 06:36
The fact is that Jetstar is not a stand alone company, it is part of the QF Group. (I saw it written on the side of the A330). It may have its own structure BUT the main decisions are made by the QANTAS Board.

roamingwolf
17th Aug 2007, 06:52
exactly mate how much is the rat propping up jokestar

toolish
17th Aug 2007, 06:54
Jetstar wasn't set up from scratch

roamingwolf
17th Aug 2007, 06:56
how do you work that one out

Fliegenmong
17th Aug 2007, 06:58
Aircraft could set something up like this from scratch!

Easy with a bunch of 457 visa holders on AWA's - bowl of rice a day (A teaspoon of soy sauce to go with it can be considered your yearly bonus)

toolish
17th Aug 2007, 06:58
Impulse AOC

roamingwolf
17th Aug 2007, 07:04
mate thats like saying a hillman imp turned into a monaro.the only thing in common is they both have wheels.

toolish
17th Aug 2007, 07:26
I kept the words to a minimum so it could be easily understood.

It was not set up from SCRATCH (ie from nothing) but of course there are cost associated with the change:zzz: But that's right Qantas paid all of those

stubby jumbo
21st Aug 2007, 04:37
We just hads one of the Clowns from EXCO on board masquerading as Management.

Just to crack some conversation I said to him:

"not a bad profit result"?

He looked up in total disbelief and said:

"Yeah not bad I suppose , BUT............we're in a sweet spot and its only going to last for a while".

I was so stunned by this "lack of" response , that I walked off. Only afterwards did it sink in. Then I thought.......

These people have totally lost the plot. Why???


Record profits.
Best in our history.
Future aircraft orders of $25 billion.................and yet , they still can't celebrate success. The REASON why 1,2,& 3 are there is due to the efforts of ALL staff -hooraay!

Now I get why some staff member "king hit" Jimmy Bow tie in the Car Park one night a few years back.

Its called TOTAL FRUSTRATION :ugh::ugh::ugh::mad::mad::mad::oh::oh:

lowerlobe
21st Aug 2007, 06:12
Stubby....

"Yeah not bad I suppose , BUT............we're in a sweet spot and its only going to last for a while".


Stubby ,pity you didn't ask him why then was APA so willing to borrow so much money to buy the company.

or is this another example of managment hiding the true value so they can cry poor at every opportunity.

It reminds me of the comedy scene (Mel Brooks I think) where someone asks this Jewish lady how she is going.She looks at him and say's.. "Not bad but could be better"