Qantas announces $1.9 billion loss

[TimmyTee]

https://www.smh.com.au/business/companies/qantas-swings-to-1-9b-loss-during-toughest-conditions-in-100-years-20200820-p55ngm.html (https://www.theage.com.au/business/companies/qantas-swings-to-1-9b-loss-during-toughest-conditions-in-100-years-20200820-p55ngm.html)
Qantas has swung to a $1.9 billion after-tax loss for the 2020 financial year after the COVID-19 pandemic forced it to ground most of its aircraft and halt international flights entirely.

Chief executive Alan Joyce said the pandemic presented the toughest set of conditions for the airline in 100 years, and that it was now unlikely Qantas will restart international flying before June next year, with the possible exception of flights to New Zealand.


The group reported a statutory loss before tax of $2.7 billion. The company did not announce a second-half dividend.

"The impact of COVID on all airlines is clear. It’s devastating and it will be a question of survival for many," Mr Joyce said. "What makes Qantas different is that we entered this crisis with a strong balance sheet and we moved fast to put ourselves in a good position to wait for the recovery."
Qantas' net loss was driven by a $1.4 billion non-cash write-down to assets including its fleet of Airbus A380s, which have been parked in the Californian desert for at least three years, and $642 million in redundancy and other restructuring costs. Excluding those one-off costs, Qantas reported an underlying profit of $124 million, down 91 per cent from last year.Qantas' revenue between April and the end of June fell 82 per cent, pushing annual revenue down 20 per cent to $14.2 billion.

In June, Qantas said it would axe 6000 jobs, or around 20 per cent of its workforce; retire its remaining 747s ahead of schedule and mothball most of its international aircraft for 12 months in an effort to cut costs. The airline is currently flying around 20 per cent of its pre-COVID domestic capacity.

Mr Joyce said Qantas was on track for a full-year profit of more than $1 billion when the COVID-19 crisis struck, and the fact that it still delivered an underlying profit showed how quickly it adjusted to the collapse in revenue.

“Recovery will take time and it will be choppy," he said. "We’ve already had setbacks with borders opening and then closing again. But we know that travel is at the top of people’s wish lists and that demand will return as soon as restrictions lift."

Around 20,000 Qantas staff remain stood-down from work, from a pre-COVID workforce of 29,000.

Qantas said it collected $267 million in payments through the JobKeeper scheme, with the majority going to stood down workers and the rest used to subsidise the wages of staff continuing to work.

[Lapon]

It's a little less dramatic when $1.4b of that is just asset write downs, although the next six months will be interesting. There seems to be confidence in domestic travel, limited only by border closures rather than demand.

[Redpanda]

Bonuses all round for executive management!

[TimmyTee]

It's a little less dramatic when $1.4b of that is just asset write downs, although the next six months will be interesting. There seems to be confidence in domestic travel, limited only by border closures rather than demand.

Whats the trade off for writing down the entire 380 fleet to the tune of $1.4bill? Didn’t the same thing happen for the 747s only a short while back?

[maggot]

Whats the trade off for writing down the entire 380 fleet to the tune of $1.4bill? Didn’t the same thing happen for the 747s only a short while back?
Keep the loss in as few reports as possible. Secure rights and move on (up...)

[dr dre]

Keep the loss in as few reports as possible. Secure rights and move on (up...)

So, maybe not next year but 21/22 should be a quite a profitable year.

[normanton]

It's Allan's transformation program all over again. Write off everything he can, announce a huge loss. Big profits from FY21-22 onwards. Hand shakes all round with huge management bonuses. Rinse & repeat.

[Angle of Attack]

I think they will find it hard to report an underlining profit for 20/21 unless by some miracle all this State border kids playpen fighting comes to an end.

[Ollie Onion]

This financial year will be a loss but not as bad as the one just announced and then a big profit 21/22. It is the transformational playbook repeated. Big bonuses coming for the executive team.

[1A_Please]

"Never let a good crisis go to waste" Winston Churchill

[blow.n.gasket]

Stage manage for a Government bail out , then use that for another share buy back just prior to the next vesting date , bingo !

[machtuk]

The little leprechaun won't be missing out on too much he's cunning and will have our corrupt Govt and the SkyGod lovers in his back pocket! -)

[OBNO]

What’s a Skygod lover?

[roundsounds]

It's Allan's transformation program all over again. Write off everything he can, announce a huge loss. Big profits from FY21-22 onwards. Hand shakes all round with huge management bonuses. Rinse & repeat.
yep, you’ve nailed it!

[Angle of Attack]

Sky god lover? Lol, please tell...

[Double_Clutch]

When will QF be seeking Government support?

[C441]

When will QF be seeking Government support?
I'm sure Qantas and all the other airlines are constantly seeking government support in one form or another but it appears that, with no international network and a minimal domestic network, they won't actually need financial support for 12 to 18 months.

[packapoo]

Two of you need your eyes tested....

He said SkyGod :ugh:

[Mr Google Head]

When will QF be seeking Government support?

don’t think Alan believes in Government support; this from a newspaper 3 months ago:“Qantas CEO Alan Joyce warned against Federal Government assistance for his airline's competitor, saying help should not be offered to businesses that had been "badly managed".

Mr Joyce has repeatedly said airlines are facing a "survival of the fittest" scenario as the coronavirus pandemic grounds thousands of planes.

He has previously said Qantas is not seeking a bailout, but has warned that if Virgin gets government aid, the Federal Government needs to "level the playing field" to avoid distorting the market.”

[blow.n.gasket]

OBNO
What’s a Skygod lover?

I believe it’s either a battery operated marital aid or the brand name of some exotic prophylactic!

[gordonfvckingramsay]

Whether he’s posturing for a government handout or laying down a precursor to more job losses/downward pressure on pay and conditions, the only certainty is he will do VERY well out of this while we all burn.

[Aviater]

Whether he’s posturing for a government handout or laying down a precursor to more job losses/downward pressure on pay and conditions, the only certainty is he will do VERY well out of this while we all burn.

Never a truer word spoken.

While the share price is low, AJ & his sidekicks will transfer all of their income to share options at a predetermined price and stave of taking any salary for as long as they can/have to. Then when the timing is right and/or there's a big enough distraction, they'll collect their share options and cash them in. A very large percentage of executives around the world are using the same strategy during the downturn.

[ebt]

When will QF be seeking Government support?

It's already receiving it under the RANS and DANS programs, although the support is going on fewer routes as time goes on. It is route specific and aimed at ensuring a minimum level of connectivity, so not a bailout per se, but certainly helping to flights in the air.

[Arthur D]

Bonuses all round for executive management!

I’m confused, ASX release says no bonus....

Please explain?

[Double_Clutch]

AJ and crew deserve a bonus

[SandyPalms]

AJ and crew deserve a bonus

Why? Aren't they just doing their job?

[gordonfvckingramsay]

AJ and crew deserve a bonus

For......?

[ANstar]

For......?

For not running the business into the ground like over the fence at Virgin perhaps? I guess if you don't like working for the rat you can always go to VA. Oh wait....

[SandyPalms]

For not running the business into the ground like over the fence at Virgin perhaps? I guess if you don't like working for the rat you can always go to VA. Oh wait....

Again, isn’t that their job?

[gordonfvckingramsay]

Again, isn’t that their job?

Precisely.

And let’s not forget that most of the “amazing” numbers have been due to slight of hand and write-offs.

[Sunfish]

As I said some time ago, the bankers are worried about Qantas survival without a bail out.

[Green.Dot]

As I said some time ago, the bankers are worried about Qantas survival without a bail out.

Maybe these piece of sh;t Premiers can chip in to that bail out fund?

[dr dre]

As I said some time ago, the bankers are worried about Qantas survival without a bail out.

But seemingly not the investors. Share price up almost 4% the day after the announcement. Share price up to $3.70 from $3.20 three weeks ago. They’re seeing something these supposed bankers aren’t.

[DirectAnywhere]

But seemingly not the investors. Share price up almost 4% the day after the announcement. Share price up to $3.70 from $3.20 three weeks ago. They’re seeing something these supposed bankers aren’t.

A bailout? Potential government $$$ is always good news. Look at US stocks in the midst of the biggest recession/ depression for almost a century.

[gordonfvckingramsay]

A bailout? Potential government $$$ is always good news. Look at US stocks in the midst of the biggest recession/ depression for almost a century.

The board and the shareholders know very well that the Gov will never see the country without a national carrier, all they have to do is sit back and await the ill gotten gains. Then the recovery with an effective monopoly will see them all rewarded handsomely with post COVID price hikes a certainty.

[Double_Clutch]

Maybe AJ will seek a market lead approach to funding and bailout?

[Bug Smasher Smasher]

Maybe these piece of sh;t Premiers can chip in to that bail out fund?
Need to get the states to start funding JobKeeper. Watch how quickly the borders open up then.

[Green.Dot]

Need to get the states to start funding JobKeeper. Watch how quickly the borders open up then.

100% BugSS!

Although I suspect WA won’t care, they will just keep feathering their own nest and keep riding on their resources to prop them up.

[Sunfish]

Opening interstate borders isn’t going to help until customers have confidence that the coronavirus risk is both small and manageable.

[Ragnor]

Opening interstate borders isn’t going to help until customers have confidence that the coronavirus risk is both small and manageable.

Define small and manageable. No other premier can.

[normanton]

Don't be fooled by the figures.

Qantas actually made a $120m profit (awesome effort).

Huge write down of 380 fleet (note the exact same thing happened to the 747's)

$600m for redundancy payouts (funded by the release of new shares)

It cost Qantas nothing. It's nothing more than a paper loss for future company tax relief.

[Green.Dot]

Don't be fooled by the figures.

Qantas actually made a $120m profit (awesome effort).

Huge write down of 380 fleet (note the exact same thing happened to the 747's)

$600m for redundancy payouts (funded by the release of new shares)

It cost Qantas nothing. It's nothing more than a paper loss for future company tax relief.

So are you now telling us LWOP is not required to secure our future? All is rosy?

[No Idea Either]

It cost Qantas nothing. It's nothing more than a paper loss for future company tax relief.

Nothing more than a paper loss for an amaaaaaaaaaazing turn around and another amaaaaaaaazing 26 Million bonus😒😒

[normanton]

So are you now telling us LWOP is not required to secure our future? All is rosy?
Not at all. The second half of the year was a huge loss. Shielded by the fact that the first half was a huge profit.

[Transition Layer]

So are you now telling us LWOP is not required to secure our future? All is rosy?
Haha, gold!

[gordonfvckingramsay]

Don't be fooled by the figures.

Qantas actually made a $120m profit (awesome effort).

Huge write down of 380 fleet (note the exact same thing happened to the 747's)

$600m for redundancy payouts (funded by the release of new shares)

It cost Qantas nothing. It's nothing more than a paper loss for future company tax relief.

So you’re saying that QF is profitable but just not profitable enough?

[Reflex10]

Big write-offs in B747 values a few years back and A380's now simply confirm that previous profits were overstated by not charging sufficient depreciation etc.
Sets it up for a stream of higher profits as happened with the last big write-off a few years ago.
Very cunning!!

[Keg]

Tino La Spina boned.

[SandyPalms]

Terrific. Now he can get a job at dodgy brothers used cars, where his talents can really be used.

[Denied Justice]

Was COVID the excuse or the reason ? :confused:

[1A_Please]

....or shielded by a dubious selection as to what is normalised profit. Having staff would seem to be part of running a business so not entirely sure why exiting the staff is not part of normal profit. The same applies to fuel hedging.

[upset jet]

stranded cost?

[banana cucumber]

Sorry for a silly question - why does AJ takes 65% cut while others take 85%? Shouldn't he or all staff on the same pay cut?

[itsnotthatbloodyhard]

Sorry for a silly question - why does AJ takes 65% cut while others take 85%? Shouldn't he or all staff on the same pay cut?

Maybe Tino made the mistake of asking the same thing.

[hotnhigh]

Hickey, Webster, Evans, la Spina. Hmmm seems like they aren’t getting the right talent. Good luck Andrew David. Thank god the bloke at the top is so good.

[dr dre]

As much as dabbling into conspiracy theories about why TLS is leaving makes us all think we’re smarter and know the “real truth”, the story presented is by far the most logical one. His position became redundant as Int CEO as there is no Int flying forecast for a year. When it does start up again it could probably be managed under existing management structures for a little while before a dedicated Int CEO is needed again.

As much as TLS copped criticism over his initial letter to Flt Crew last year, I think he showed a lot of effort by turning up to most webinars and taking questions on demand. It’s never a good thing to be made redundant in any job.

[Qantas 787]

As much as dabbling into conspiracy theories about why TLS is leaving makes us all think we’re smarter and know the “real truth”, the story presented is by far the most logical one. His position became redundant as Int CEO as there is no Int flying forecast for a year. When it does start up again it could probably be managed under existing management structures for a little while before a dedicated Int CEO is needed again.

As much as TLS copped criticism over his initial letter to Flt Crew last year, I think he showed a lot of effort by turning up to most webinars and taking questions on demand. It’s never a good thing to be made redundant in any job.

If they wanted him to stay, they would have found a lower position for him. Who knows if he was offered that.....he might have been given another role and decided against it

[Ragnor]

TLS never got a stand down clause in his contract I'm guessing!

[normanton]

Crikey! If this isn't a wake up call for many, I don't know what is.

[Stickshift3000]

Sorry for a silly question - why does AJ takes 65% cut while others take 85%? Shouldn't he or all staff on the same pay cut?

AJ's salary has been reduced to 65% of normal pay, his direct reports are on 85% of normal pay.

I'm sure AJ can afford it!

[Transition Layer]

When it does start up again it could probably be managed under existing management structures for a little while before a dedicated Int CEO is needed again.

Au contraire. I think they’ll need a new CEO in place sooner rather than later to manage the logistical nightmare that will occur during start up, getting aircraft and crew back on line and investigating new routes (hint, the usual hunting ground of the US and UK won’t be a great option initially).


Crikey! If this isn't a wake up call for many, I don't know what is.

If only he’d taken LWOP Normanton! That would have saved him!

[Xeptu]

Nah! He would have put his hand up for VR and got paid out handsomely. Now he's free to start up QF International with AJ as a major shareholder :)

[Green.Dot]

Must be tough- imagine that, being shown the door with your millions and retiring on the beach. Where do I sign up?

[blubak]

Terrific. Now he can get a job at dodgy brothers used cars, where his talents can really be used.
To get a job there he will need to spend some of his redundancy to buy a tie,no more open neck shirt work days

[normanton]

If only he’d taken LWOP Normanton! That would have saved him!
Should have checked his contract!

[ruprecht]

Should have checked his contract!
Why? You didn’t check yours.

[Green.Dot]

Why? You didn’t check yours.

Mods, is it possible to add some LIKE buttons to this platform?

[A320 Flyer]

Mods, is it possible to add some LIKE buttons to this platform?

second that...

LIKE!

[Blueskymine]

Why? You didn’t check yours.

Brilliant.

Normanton I’m playing the worlds smallest violin for you.

[ConfigFull]

Big, big, big like.

[normanton]

Why? You didn’t check yours.
Sorry. What didn't I check in the contract?

If your going to say the CR package, then go re-read the question.

Brilliant.

Normanton I’m playing the worlds smallest violin for you.
That's great. Why?