QF Losses

[RodH]

Qantas have just announced a $1.08 Billion dollar loss in the last 6 months .
That's a hell of a lot of money but they reckon they still have $4 billion to tide them over.
Nice to have a little nest egg to fall back on.
This disastrous Covid bug sure has played havoc with a lot of balance sheets!!!

[SHVC]

Reading the ASX seems if domestic borders remained open QF group would be making a squillion. 70% decline in revenue and QF (domestic) QLink and JQ were generating positive cash flow JQ seeing 250,000 booking in Novemebr. Then there is the freight which is going off. International, well thats obvious outcome.

Once consumer confidence returns I think QF group will drown out any competitor.

[LostWanderer]

Reading the ASX seems if domestic borders remained open QF group would be making a squillion. 70% decline in revenue and QF (domestic) QLink and JQ were generating positive cash flow JQ seeing 250,000 booking in Novemebr. Then there is the freight which is going off. International, well thats obvious outcome.

Once consumer confidence returns I think QF group will drown out any competitor.

Hope so! I want to get back to work and agree QF certainly will dominate the competition in the Australian market once things get back on track.

But I know more than a few people who are sick of Alan/QF announcing "International travel will resume on date X!" to great media fanfare then as it has been the last, what is it now...two times?...zip...nada...no bueno. And this is after taking punters hard earned dollars on bookings in many cases. I still suspect towards mid 2022 will be the absolute earliest customer confidence really starts to return and good things begin to happen with international traffic. Til then a realist can only expect plenty more nasty financial losses are still coming for the group.

[Keg]

A lot of that stuff about dates resuming flying is about ‘signalling’ to the government and to keep the pressure on them. Perhaps even to generate an expectation in the community that they’ll be travelling soon so that if the government says ‘no’, people power will start to put pressure on them.

I love AJ’s optimism but ‘crazy brave’ is how I would describe the time frame!

[dr dre]

The market doesn’t seem too worried about it all. Share price up 4% this morning. Add to that this article published yesterday about similar share price rises earlier in the week:

Why did Qantas (ASX:QAN) shares soar 4% on Tuesday? (https://www.fool.com.au/2021/02/23/why-did-qantas-asxqan-share-price-soar-4-on-tuesday/)

[SHVC]

I think AJ is doing a good job keeping pressure on the gov. Best airline CEO in Australia at the moment I’m sure there are a lot of stood down pilots that will disagree, but the important thing you should have a job still in 2022

[Ladloy]

The market doesn’t seem too worried about it all. Share price up 4% this morning. Add to that this article published yesterday about similar share price rises earlier in the week:

Why did Qantas (ASX:QAN) shares soar 4% on Tuesday? (https://www.fool.com.au/2021/02/23/why-did-qantas-asxqan-share-price-soar-4-on-tuesday/)
If you read share forums they're very excited for more redundancies to 'cut the fat'

[Ollie Onion]

I don't think we have seen the full extent of redundancies at any Airline. We are not through this crisis and we have more cuts to come I am sure.

[Agent_86]

I don't think we have seen the full extent of redundancies at any Airline. We are not through this crisis and we have more cuts to come I am sure.

Rumours doing the rounds today is another 1500 VA staff to go next month? Ms Jayne has been too busy with the AO to announce it... :rolleyes:

[Barrt3344]

Where from? Head office has been cleaned out and is extremely lean. Cabin crew have been asked to pay back their voluntary redundancies and rejoin the airline. Don’t think there’s too much left to cut without considerably shrinking the airline.

[Foxxster]

Oh dear, I wonder if Mr Joyce has seen this.

Summer holidays hang in the balance after the World Health Organisation (https://www.dailymail.co.uk/news/world-health-organization/index.html) urged against using vaccine passports to facilitate international travel.

It said proof of a jab should not be required because there remain 'critical unknowns regarding the efficacy of vaccination in reducing transmission'.

The WHO added that inoculated passengers should not be able to sidestep existing travel restrictions designed to reduce Covid.
Setting out the WHO stance, the interim position paper states: 'At the present time, it is WHO's position that national authorities and conveyance operators should not introduce requirements of proof of COVID-19 vaccination for international travel as a condition for departure or entry.'It is a fresh blow for both holidaymakers and tourism bosses hoping vaccine passports will pave the way for overseas trips.

That people should be mandated to have a vaccine to enjoy greater freedom is a politically divisive issue being fought out in national capitals.

The WHO's paper also says: 'National authorities should choose public health interventions that least infringe on individual freedom of movement.'

[wheels_down]

I don't think we have seen the full extent of redundancies at any Airline. We are not through this crisis and we have more cuts to come I am sure.
Jetstar 787 operation and all Jetstar Cadets?

Scoot sacked all the cadets. Local cadets got the boot and Aussie perm residents stayed.

Bring the cadets back mid decade.

[Barrt3344]

Jetstar 787 operation and all Jetstar Cadets?

Scoot sacked all the cadets. Local cadets got the boot and Aussie perm residents stayed.

Bring the cadets back mid decade.

Or you could simply enact the redundancy clause as per the EBA without singling out cadets.

[Street garbage]

I don't think we have seen the full extent of redundancies at any Airline. We are not through this crisis and we have more cuts to come I am sure.

Unfortunately, I don't think we have either. Despite the narrative of the Company, SH is being squeezed by 717 BNE/MEL base flying, Network in WA, a transfer of "Non- Business" flying to JQ (eg ADL-ASP-DRW), and Alliance in the future.

[wheels_down]

Cadets last in, first out. Sorry but everyone feels the same. They get the fast tracked way in, they get the fast tracked way out.

[Barrt3344]

Cadets last in, first out. Sorry but everyone feels the same. They get the fast tracked way in, they get the fast tracked way out.

Or again you could simply go with what the EBA states. That is what the majority of the pilot group voted in.

[Telfer86]

Not what happened at Scoot, first to go were foreign pilots on work visas , then Singaporean PRs , then likely Malaysian citizens
, objective to protect Singaporean citizens

Not looking great for Australian SOs but at QF at least an extensive warning was given & an option to avoid redundancies was available to all SOs

[SHVC]

Or again you could simply go with what the EBA states. That is what the majority of the pilot group voted in.

JQ EBA is pretty loose around this redundancy clause. 24 I believe. Seniority only being a consideration so seems JQ will do what JQ will want to do despite the unions.

[Paragraph377]

Oh dear, I wonder if Mr Joyce has seen this.

Summer holidays hang in the balance after the World Health Organisation (https://www.dailymail.co.uk/news/world-health-organization/index.html) urged against using vaccine passports to facilitate international travel.

It said proof of a jab should not be required because there remain 'critical unknowns regarding the efficacy of vaccination in reducing transmission'.

The WHO added that inoculated passengers should not be able to sidestep existing travel restrictions designed to reduce Covid.
Setting out the WHO stance, the interim position paper states: 'At the present time, it is WHO's position that national authorities and conveyance operators should not introduce requirements of proof of COVID-19 vaccination for international travel as a condition for departure or entry.'It is a fresh blow for both holidaymakers and tourism bosses hoping vaccine passports will pave the way for overseas trips.

That people should be mandated to have a vaccine to enjoy greater freedom is a politically divisive issue being fought out in national capitals.

The WHO's paper also says: 'National authorities should choose public health interventions that least infringe on individual freedom of movement.'

What an effing joke. So you get the precious ‘jab’ that Government keeps pushing as being the solution, and then they tell us we still shouldn’t travel and start going about normal activities. Why? Because in the Government’s rush to rush vaccinations through they didn’t account for different variations of the virus, some of which will only be 30% effective. What a joke.

[PoppaJo]

Or again you could simply go with what the EBA states. That is what the majority of the pilot group voted in.
The EBA states nothing. They can do whatever the hell they want. Your interpretation of the wording is wrong. Read closer.

What went on at Scoot (Cadets) and Tiger (Airbus specific) most certainly could play out here.

[blubak]

Unfortunately, I don't think we have either. Despite the narrative of the Company, SH is being squeezed by 717 BNE/MEL base flying, Network in WA, a transfer of "Non- Business" flying to JQ (eg ADL-ASP-DRW), and Alliance in the future.
Couldnt agree more,the 717s will be flying many more sectors with 80 -90% load factors whereas the 738 would have been well under 70% along with higher paid crew.
Network will start to get a bigger slice of any flying that costs less even if it means crews overnighting & alliance has the e jets now,they wont be sitting idle if a $ can be saved or made.

[gordonfvckingramsay]

Results Summary

Underlying Profit Before Tax: $124 million (down 91%)
Statutory Loss Before Tax: $2.7 billion (majority of which is non-cash, including aircraft write downs)
$4 billion revenue impact from COVID crisis in 2H20
Operating cash flow: $1.1 billion
Liquidity of $4.5 billion providing considerable buffer to manage uncertainty
Significant progress on initial steps of three-year recovery plan



It’s been a tough year no doubt, but the organisation turned a profit before tax and before write downs.

[Foxxster]

It’s been a tough year no doubt, but the organisation turned a profit before tax and before write downs.


thanks in large part to “Qantas Loyalty’.

During the period, the Group’s Domestic airlines flew approximately 30 per cent of their Pre-COVID network but remained profitable contributing $71 million at the Underlying EBITDA level. The Group’s International operations fell into losses, contributing an Underlying EBITDA loss of $86 million, as the Group’s International passenger operations were largely grounded. Qantas Freight delivered a record performance providing a natural hedge to the impact of the grounding of the passenger business, limiting the losses from Group International. The resilience of the Qantas Loyalty business was again demonstrated as it generated a significant positive cash flow contribution for the Group and an Underlying EBITDA of $152 million. This reinforces the benefit of the diversification of earnings it provides.

plus you can’t look at before tax, before depreciation, before whatever, they are real expenses. Yes it is one look at a company but ....

debt has increased quite significantly.. 840 million.

[gordonfvckingramsay]

thanks in large part to “Qantas Loyalty’.

During the period, the Group’s Domestic airlines flew approximately 30 per cent of their Pre-COVID network but remained profitable contributing $71 million at the Underlying EBITDA level. The Group’s International operations fell into losses, contributing an Underlying EBITDA loss of $86 million, as the Group’s International passenger operations were largely grounded. Qantas Freight delivered a record performance providing a natural hedge to the impact of the grounding of the passenger business, limiting the losses from Group International. The resilience of the Qantas Loyalty business was again demonstrated as it generated a significant positive cash flow contribution for the Group and an Underlying EBITDA of $152 million. This reinforces the benefit of the diversification of earnings it provides.

plus you can’t look at before tax, before depreciation, before whatever, they are real expenses. Yes it is one look at a company but ....

debt has increased quite significantly.. 840 million.

Agree, but a lot of write downs are done so by choice as a tax offset strategy.

[V-Jet]

debt has increased quite significantly.. 840 million.

Put yourself in Joyce's position. Not in bed, I hasten to add, but financially.

He has a MASSIVE opportunity to write down whatever the hell he wants. There will be losses everywhere. He will be bleeding losses. Although, not so much for his personal salary, obviously. He will still get paid, but for everything else - it's a cataclysmic disaster.

Qantas is (and in this regard I agree with the tepid little worm) too big to fail. In spite of everyting (sic) he's (sic) done for (sic) the Company, it will leap from the bowels of destruction to an incredible turnaround in whatever time frame can be mutually agreed by his (sic) accountants and the Govt.

Up until about September last year I did have (some) sympathy for Elaine. It wouldn't have been easy, But he was 'always' too big to fail. He knew it, the Govt knew it, and he is a master of graft, political soft glove 'persuasion' and naturally, persecution of staff.

That bit is yet to come.

[McLimit]

Qantas will ******* a-niiiiiiihilate the competition. Lay down misere.

Best airline CEO in Australia at the moment

:}:} gee-sus, look at the competition. That's like saying Eddie the Eagle is the best ski jumper in a one man event.

[novice110]

Much easier to sell JobKeeper 2.0 for International employess if the expectation is an October 2021 end.

Might get it over the line - and then extend when borders haven't opened as expected.

As opposed to trying to sell a 12 month or longer JK package.

[morno]

The EBA states nothing. They can do whatever the hell they want. Your interpretation of the wording is wrong. Read closer.

What went on at Scoot (Cadets) and Tiger (Airbus specific) most certainly could play out here.

Just to clarify, I believe that the Tiger example is not a good one. That is what they (Virgin/Tiger) wanted to do (Airbus redundancies), however it was pointed out that they couldn’t actually do that, and that became the first downfall that resulted initially in everything bar the Melbourne flight attendants becoming redundant. Eventually of course the whole brand was discarded of.

[wheels_down]

Just to clarify, I believe that the Tiger example is not a good one. That is what they (Virgin/Tiger) wanted to do (Airbus redundancies), however it was pointed out that they couldn’t actually do that, and that became the first downfall that resulted initially in everything bar the Melbourne flight attendants becoming redundant. Eventually of course the whole brand was discarded of.
I thought A320 crews got the news in Feb, then as things proceeded to get worse, in late March when Virgin was basically trading insolvent, 737 crews were added to the list also?

[empacher48]

Since I’ve been grounded through this, I’ve taken it upon myself to up-skill in the business world.. Funny thing, when the economy tanks, it’s usually not the Finance or Accounting department that get stood down..

But one thing I’ve learned is that profit and loss statements are just for the paying of tax. Minimise the profits, make large losses and you can carry those tax credits on for as long as you can. It means you don’t have to pay as much tax during the great turn around. If you’re going to record a loss, make it as big as you can get away with. Profit and loss does nothing to the share price and the value of the company.

The cash flows are what adds the value, if you don’t have the cash to pay a dividend, watch your share price fall faster than a brick, taking the value of the company with it. Keep a positive cash flow during the worst crisis the industry and the share price will at least remain stable and then head for the skies at the end.

No matter what you think of Joyce, he’s doing a good job making sure the QF group is around for a long time and do what it’s main job is. Returning appropriate wealth to its shareholders.

[Foxxster]

Agree, but a lot of write downs are done so by choice as a tax offset strategy.

there weren’t a lot of write downs. And they are usually done for one of two reasons. The first being there is a legal requirement to do so if the book value of an asset exceeds its market value. Which is what happened with Qantas and it’s aircraft.

the other reason is usually where a new ceo takes over and uses management discretion to drag out all the skeletons and also deliberately be more cautious than required so that things can be unwound in subsequent years to boost profit in those years and hence bonuses tied to profit and share price to get bonus shares tied to the share price.

examples are for a bank, bad loan provisions. New ceo says they think there is not enough provided so add a few hundred million. Or more. Insurance companies it is the amount put away for future claims, again you can move several hundred million based on management discretion. There are other tricks. But watch next time a new ceo takes over a bank, insurance company etc. the results for that year will always be terrible, a lot worse than the previous years. The results will then miraculously recover in the next and subsequent years.

The same thing happens in major downturns like the GFC and perhaps now, but there are other tricks ...

on a side note regarding Qantas, we all know that the previous years profits have been significantly created because of the low oil price of around $40US a barrel. Take a look at the price now. Just over $63 and climbing. Hmmmm.

[Foxxster]

Since I’ve been grounded through this, I’ve taken it upon myself to up-skill in the business world.. Funny thing, when the economy tanks, it’s usually not the Finance or Accounting department that get stood down..

But one thing I’ve learned is that profit and loss statements are just for the paying of tax. Minimise the profits, make large losses and you can carry those tax credits on for as long as you can. It means you don’t have to pay as much tax during the great turn around. If you’re going to record a loss, make it as big as you can get away with. Profit and loss does nothing to the share price and the value of the company.

The cash flows are what adds the value, if you don’t have the cash to pay a dividend, watch your share price fall faster than a brick, taking the value of the company with it. Keep a positive cash flow during the worst crisis the industry and the share price will at least remain stable and then head for the skies at the end.

No matter what you think of Joyce, he’s doing a good job making sure the QF group is around for a long time and do what it’s main job is. Returning appropriate wealth to its shareholders.

sorry, what you have written is complete garbage.

have you checked the consolidated cash flow statement of Qantas for this year. -861 million from operations, -514 million from investing, +468 million from financing. That was due to increased debt.

and returning appropriate wealth to shareholders. Thanks for the laugh.

reading your post again, perhaps it was satire.. I hope so.

[WillieTheWimp]

I thought A320 crews got the news in Feb, then as things proceeded to get worse, in late March when Virgin was basically trading insolvent, 737 crews were added to the list also?
Correct...First it was the A320 in BNE and SYD only. At that point the A320 and 737 was safe in MEL. (February)

Then it was all A320. (Early March)

Then everyone. (Mid-late March)

At no point was seniority a consideration at all!

[WillieTheWimp]

Just to clarify, I believe that the Tiger example is not a good one. That is what they (Virgin/Tiger) wanted to do (Airbus redundancies), however it was pointed out that they couldn’t actually do that, and that became the first downfall that resulted initially in everything bar the Melbourne flight attendants becoming redundant. Eventually of course the whole brand was discarded of.
Yes it was pointed out that they couldn't do it. The majority on the 737 were the most junior. However, the company was going ahead regardless. The 737 was retrenched as a result of Covid and the groundings taking place. It was not due to the legality of the Airbus redundancies.

Unless your EBA is watertight and completely unambiguous around redundancy—most are not, expect the company to take the most efficient option.

[Doors To Manuel]

Oh dear, I wonder if Mr Joyce has seen this.

The WHO added that inoculated passengers should not be able to sidestep existing travel restrictions designed to reduce Covid.

That people should be mandated to have a vaccine to enjoy greater freedom is a politically divisive issue being fought out in national capitals.

The WHO's paper also says: 'National authorities should choose public health interventions that least infringe on individual freedom of movement.'

It beggars belief that the WHO and all the other govt bodies across the world are urging us all to get vaccinated, and then turning round and saying 'ha ha, but there is no proof that this actually works, fooled ya!' Are they not reading the drip feed of studies that are showing the stunning efficacy of even just 1 dose from pretty much all the main vaccines currently being used?
As for the issue of vaccines being mandated.....don't we already have that, albeit only now with Yellow Fever and in a very few countries.

C'mon, let's get flying again!

[Come in spinner]

WHO, etc.
are just enjoying their time in in the light.

[ScepticalOptomist]

Not what happened at Scoot, first to go were foreign pilots on work visas , then Singaporean PRs , then likely Malaysian citizens
, objective to protect Singaporean citizens

Not looking great for Australian SOs but at QF at least an extensive warning was given & an option to avoid redundancies was available to all SOs

What nonsense.

[Fonz121]

What nonsense.

Agreed. What's with the QF SO demise you seem so keen on Telfer? Seems to be a recurring theme in your posts.

[McLimit]

Dear Me, if there is not a more corrupt, unethical, incompetent, deceitful lieing bunch of ***** than the WHO I'll stand rooting. Anyone who mentions them in any justification of health 'advice' is just showing how stupid and ignorant they are. Probably Victorians, Western Staters & Queenslanders (in that order) mention WHO most.

[Paragraph377]

WHO, UN, just more alphabet soup agencies that are a protected cocoon for bureaucrats and politicians. They all speak the same language - bull****. Another mob of idiots are IATA. Publishing statistics on the downturn of airline profits, passenger numbers and aircraft movements. No **** Sherlock. Why do we need these fools to tell us what we already know!! The majority of people on these forums are hard working frontline people badly affected by this global shutdown. Organisations like IATA and WHO are just seeking relevance within a world economic environment that doesn’t need them anymore. The production of useless data that does nothing to enable industry to either survive (barely), get back on its feet, or provide solutions to the current issues if they should occur again.

[Telfer86]

Not at all Fonz

Anyone who asked me I told to do LWOP to protect your position

I just didn't(& still don't) subscribe to the "push" from AIPA that it was all just a bluff & only take it you had a solid alternative

Also a push from the mid-ranks to keep a protective layer beneath them

So it was my view that a CR from the bottom up is a distinct possibility & calling yourself Iconic etc ain't gonna change that

You may have a different view & that is your right as it is a free country (another topic there I guess)

[Fonz121]

I don't disagree that a CR from the bottom will be how it's done, but I also don't see it being necessary. I guess the main risk is the company using it as a threat to get any variations they want over the line. If they do want to run a CR program, what's to stop them doing it after everyone starts coming back from lwop in Sept? It would be a king dick move but nothing to stop them doing it.

But I still believe that with all the progress being made around the world that there is finally some light at the end of the tunnel and CR won't happen. It's mostly a PR battle now.

[blubak]

I don't think we have seen the full extent of redundancies at any Airline. We are not through this crisis and we have more cuts to come I am sure.
The been everywhere man(Andrew David) confirmed yesterday at a senate inquiry that more job losses are definitely very possible.
He announced he has worked for 6 airlines so the next place for him could be back to VA to join Jane or maybe Rex,he is running out of places to go.

[ScepticalOptomist]

Not at all Fonz

Anyone who asked me I told to do LWOP to protect your position

I just didn't(& still don't) subscribe to the "push" from AIPA that it was all just a bluff & only take it you had a solid alternative

Also a push from the mid-ranks to keep a protective layer beneath them

So it was my view that a CR from the bottom up is a distinct possibility & calling yourself Iconic etc ain't gonna change that

You may have a different view & that is your right as it is a free country (another topic there I guess)

I advised the opposite. By the time the company would execute any CRs all of the LWOP takers would be back. IF the company were going to execute CR (and I don’t believe they will need to) the juniors who took LWOP would be back on stand down and not protected by anything - only with less entitlements to pay out. Smart move by the company to reduce costs. That’s all it was - fear based bluff, that worked too well! Now paying FOs to do SO lines as they are short.