It's all coming to the surface.... and not before time...

Special Board Meeting
 

Anyone else heard the rumour of a Special meeting of the board in the near future; certainly before the results are announced?

Rumour suggests that the primary topic of conversation will centre on the future of certain senior execs.

Alan & Ms Jayne may be particularly unhappy........

....but it is only a whisper.....

Another excuse for a very expensive luncheon, methinks.

This Board of F@@ls have presided over this plane wreck for years. What has changed now?

And this was in 2011!
 

Yeah, they seem so happy together... :)



for those who haven't seen it

TIM

It's such a mix of emotions watching your clips, mostly funny, sometimes sad as we watch these cl@wns mismanage this whole sorry saga.

And a government, regulator and major shareholders sitting eerily quiet whilst the business sinks.

Disappointing.

It is fairly normal that an ASX listed board meet a couple of times before results are announced. There is the formal side including a meeting with the audit partner as well as getting the comms sorted and this year the comms at QAN will be interesting to say the least.

I doubt that AJ will be dumped as part of the results announcement though I wouldn't be surprised if his departure date is announced for some point in the future....which he would be unlikely to make. I further doubt that JH is in the frame for the next CEO unless LC just wants another puppet and a continuation of the past few years. Realistically QAN needs a "trophy" external candidate as the next CEO to indicate to the market that the disaster of the past few years are behind the business.

I am not so sure. While a hard-bitten cynic most of the time I believe that now its crunch time for both the board and the executive, and that we shall soon be rid of these damned pretenders.

I cannot imagine any new board being willing to double down on the Jetstar experiment, nor any serious CEO advocating it. There is much hard work to be done, for sure, and perhaps soon we will have a team willing to undertake it.

No one sees a future on the current trajectory...its not possible. Since our current malaise is the result of ten years of neglect it follows that it will take some years of redress to correct that. I am (foolishly?) optimistic that the correction may start before year's end.

In the lead up to the release of QF's results in the next couple of weeks, I thought it'd be interesting to put forward a few stats of QF's performance during AJ's reign

Profit before Tax (Underlying profit is a w@nk used to hide management stuff-ups)

FY09 $181M
FY10 $178M
FY11 $323M
FY12 -$349M
FY13 $17M

If he manages to lose the rumoured $800M this year, this will mean he has managed to earn negative $450M for shareholders throughout his reign... a dubious achievement for a CEO who has somehow managed to survive for 6 years.

On the plus side, his personal earnings over the 5 years to 30/6/13 were $22.3M on top of the $6.9M he earned in his 4 years heading up JQ. In addition to this, if he is terminated he received 6 months salary as well as keeping his entitlement of 4 int'l trips and 12 domestic trips FOC for the next 11 years.

It will also be interesting to check out how hard the Board are on him in relation to his short -term bonus. The key components are
1. "normalised" profit which as I said before is an accounting w@nk that wasn't even mentioned in Qantas' accounts prior to AJ becoming CEO,
2. achievement of safety standards (rewarding him for the hard work of other people)
3. building a strong domestic base (he started with a strong domestic base; he is just managing how it becomes smaller)
4. transforning the int'l business (who could argue that it hasn't changed??? Pity it got smaller not bigger though), and
5. growing Jetstar in Asia (LOL)

Last year he got a Poor on 1, Excellent on 2 & 4, Good on 3 and Satisfactory on 5. This year it is hard to see him earning anything above Poor except for safety which is someone else's job anyway.

Clipped,

Also very sad for me to watch as I have spent near 40 years flying Q as my preferred airline.. still do and it's a good product even by today's standards.

Clifford & Joyce have simply added unnecessary pressure on the staff by following the wrong strategy and then refusing to admit it, the two brand thing has damaged the business, for me, no doubt about that, they have spent far too much time chasing dreams taking their eye off the ball with the progress of the core business.

Again I post this graph as backup to my argument...

https://lh4.googleusercontent.com/-H.../001-graph.png

In 2008:
Aircraft
Qantas 174 (excluding Cobham)
Jetstar 36
By 2013:
Qantas 189 (excluding Cobham)
Jetstar 86
Now:
Qantas 157 121 (plus 36 ish from Qantas link)
Jetstar 115
It appears the more aircraft added to Jetstar the harder it has been to support and the profit fell away for all of the Qantas group over time.

It's obvious that all Clifford knew was to apply his out dated "thuggish" mining industry know how, a leftover from the 1990s IR war on staff costs, as if it's all their fault, never a good strategy with a "service orientated industry," it demoralises the front-line workers, simple as that, the evidence for all to see since he commenced his tenure. AJ is only a puppet to the board in my view, and to his credit, did well setting up Jetstar domestic. He was never the "right face" for the Qantas group, it simply just didn't fit, but we are stuck with it! Once he pulled off the "grounding stunt" enter the government at the time (Gillard's lot) who "huffed and puffed" but did nothing for the Qantas workers except stitch them up with their FWA lawyer mates, Labor's own legislation reform, the answer to the Liberals big bad idea "work choices" a scare campaign that helped Labor into power.



Albo shifty as usual...



in this one about 1.50 in, Abbott says we have a problem, also shifty...(hmm lip service)

In hindsight, what's the difference?

The problem today, is we have the Liberal Government who accepted donations from the likes of Mr Clifford and other people of this type, so we just carry on. It's as if both parties don't give a damn about Aussie jobs..

Both major political parties appear to always prefer upgrades or nice lounges etc for themselves and family rather than worry about job security for Australian workers, the people they are supposed to represent, and the major reason why I fight on, you have done nothing wrong.... I am disgusted with both major political parties, they are both the same.... easily bribed by big business, this is Australia now.. no pride in anything Australian, with the exception of Nick X who has gone out of his way to support Qantas workers all along the way... Kudos to him!



As far as I know, Joyce never answered the questions properly put on notice, fobbed off... more on that later...



Just look at the last couple of weeks... DJs goes to the South Africans
DJ's duds to be junked: Woolworths

And another Aussie icon will go in due course as well.. all in the name of "free trade" of course.... code for selling the farm to line the pockets of a few!

All the way down to street level today, it's hard to find a positive comment regarding the management of Qantas (I guess why Livi is trying to change that with her social angels) they have done so much damage to the brand, to a point where this damage will only recover with a change of management from the board down in my view. As I have said before "Corporate Australia Is Sick," but allowed to bumble along provided Canberra is well looked after come donation time... that's what is really sad...

remember this back in 2011, it was all said then in a song...



I guess I am just a cry in the corporate/political wilderness..:uhoh:

Yet another own goal by JQ with regard to Jet Star HK - report in todays media:

Quote: 'The secretary of the Australian Department of Infrastructure and Regional Development, last week said the government did not want to give Cathay Pacific and other Hong Kong carriers increased traffic rights into Australia unless Australian carriers were able to use Hong Kong as a hub and Jetstar Hong Kong was approved.
“The very fact that Jetstar Hong Kong and Jetstar Australia have linked their two businesses by leveraging the setting up of Jetstar Hong Kong with traffic rights in Australia seems to make it pretty clear that Jetstar’s principal place of business is not Hong Kong, but Australia,” Mr Slosar (Cathay Chairman) told analysts on Wednesday.
“By default I think they have made the case that we would make that it doesn’t comply with the Basic Law.”

and today Cathay report massive increase 1H profit.

I think this ^^^^ is fair enough. Part of Australia's problem over the past couple of decades is its willingness to allow foreign carriers such generous access to OZ. Why should it not be reciprocated, to me it seems perfectly logical to withhold further access to OZ whilst the very same carrier is blocking the setup of an airline on its own turf that has an Australian interest.

Yet a wholly foreign owned entity can set up shop in Australia's domestic aviation market tomorrow with no restrictions whatsoever.

Cathay & Air NZ can post good profits but Clifford/Joyce can't
 

Cathay Pacific Profits Soar But Competition Hurts Yields

Cathay Pacific Profits Soar But Competition Hurts Yields

Cathay Pacific said Wednesday its first-half net profit soared to HK$347 million ($44.77 million) on higher passenger demand, but the Hong Kong flag carrier warned of a "challenging" outlook as surging competition held down fares.

The figure for the six months ending June 30 compared with a net profit of HK$24 million in the same period last year. Its first half revenue rose 4.6 percent to HK$50.84 billion.

But despite its upbeat performance, the blue-chip airline faces several challenges including persistently high jet fuel prices.

"The operating environment for the Cathay Pacific Group -- and the aviation industry as a whole -- remains challenging," group chairman John Slosar said in a filing to the Hong Kong stock exchange.

"On the plus side, we continue to strengthen our passenger network and the connections available through Hong Kong," he said.

Aviation analyst Daniel Tsang told AFP the huge increase in net profits was on account of the airline's improving passenger operations, which contributed to a sharp jump in revenues.

The airline's passenger revenue in the reported period was up 4.4 percent to HK$36.52 billion compared to the previous year, helped by the introduction of new long-haul routes to destinations such as Doha and Newark.

- Falling passenger yields -

However, Tsang said the airline will need to improve its passenger yields, a key measure of airlines' profitability, to maintain this earnings trend.

Passenger yield, the measure of the average fare paid by a passenger per mile, fell 3.5 percent to HK66.6 cents, reflecting weaker ticket prices in the face of surging competition.

"For this upward trend to be sustained, arresting this yield decline is paramount and a prerequisite," he said.

Revenue for its air cargo business, which took a toll for more than two years due to the weak economy and demand for shipments, rose 3.4 percent compared to the first half of last year, at HK$11.66 billion.

But over-capacity in the air cargo market created downward pressure on rates, with the airline seeing cargo yield falling by 6.9 percent.

"We expect our cargo business to be better in the second half of 2014 than it was in the first half. We are well placed to take advantage of any increase in demand," the airline said.

Cathay also indicated that high fuel prices were partly mitigated by operating more fuel-efficient aircraft.

Five new aircraft, including two Boeing 777-300ERs, were delivered to Cathay during the reported period, as it retired two Boeing 747-400 passenger aircraft.

Eleven new aircraft will be delivered in the second half of 2014, as it continues to modernise its fleet.

"Cathay is pretty aggressive in renewing its fleet. By end of 2014, it will only have seven gas-guzzling 747-400s," analyst Tsang said.

The International Air Transport Association in June said airline profits are improving and that it expects airline companies to record combined net profits of $18 billion for 2014, down from its earlier forecast of $18.7 billion made in March.

by W.G. Dunlop © 2014 AFP

No restrictions domestically.

But can't do any international ops without government approval. Same as Hong Kong.

Can't speak for other routes but the Hkg-Aus routes are granted on a purely one for one basis as negotiated by their respective governments. The traveling public/tourism industry shouldn't have to suffer because the current Aus based incumbent hasn't the ability to use their current slots, let alone an increase in bilateral flights.

Joyce gone by November. Cross your fingers.:ok::D

Correct, being that HKG doesn't have a domestic market. There is nothing stopping CX starting up their own domestic feeder network inside Australia calling it 'Cathay Australia' or something.

So why can't VA fill those slots ? Why single out Qantas ? Australian passengers have more then 1 option to go west or north and its not an open skies policy. CX have the basic monopoly out of Australia for those who want to go to via HKG to anywhere they fly, isn't that enough ? Not that I tend to agree with joyce and co but really whats the point of fighting over scraps on the over saturated Australia-Europe market when their current policy is to not replace retired aircraft with anything at all.

Besides

Isn't that enough ?

600,

I would say 'No' to your question as CX are upgrading 1 of their SYD services to a 777 by replacing an A330 very soon. PER-HKG is served by CX only, and they want more services asap but are not allowed. Word on the street is those flights will be upgraded to 777's as well.

b.

So here in lies a point of contention. Australia is already more then adequately served by foreign airlines at the moment. So much so that they're all complaining about yield pressures lowering profits in the Australian market.

That being the case, in what interest would it be to the government of today to allow more capacity dumping which will in turn further erode the ability of an Australian owned and Australian Employer's ability to make profits, pay tax, support the country ? We already have cheaper then taxi fare flights available. We already have extreme lcc's operating internationally. It's not going to get any cheaper in relative terms.

Cathay lobbied their government extremely well to make it all but impossible to set up shop in Hong Kong unless you're a local which is fair enough. Why shouldn't Qantas lobby the Australian government to limit the amount of capacity dumping until they get something they want ? At the same time why would CX get upset about it ? International air transport rights are an economic tool that should be mutually beneficial to everyone, there's not much point benefiting foreigners exclusively at the expense of locals. The Hong Kong/Chinese government understands this point, CX can't have their cake and eat it too.

The Answer...
 

Everyone knows the Answer to Qantas the airlines problems....get rid of Joyce & the board & sell Jetstar and watch it implode...without Qantas, Jetstar will fail in a number of months....
Time to sell the Orange Cancer!

Trouble is....who would want to buy Jetstar as a stand alone entity?

The Jetstar conundrum...
 

With the proviso that its after cocktail hour, I think that the non-sale of Jetstar is telling in many ways. Everyone thinks that due dilligence would reveal that JQ is very much a dependant child still, and is unable to exist on its own. The details of how much monay it bleeds from mainline have always been kept obscured in reports of financial results.

If Jetstar was the amaaaazing business that these idioti have claimed then they would have sold it to themselves and let Qantas flounder. That they didn't and won't shows that they don't believe their own rhetoric. (Along with everyone else)

For years now the only way that Jetstar can compete with Qantas on many routes has been when Qantas abandons those routes.

The initial case for Jetstar kinda made sense, but it is now larger than its natural market domestically, and an open wound internationaly. In a more rational world JQ would be a domestic + Bali & Phuket carrier less than 2/3 its current size. It would still be the carrier of last resort, discounting the excrable TigerAir.

Correct.

Note the performance of the brand where they have to stand on their own feet.

JQ Asia - fail
JQ NZ - fail
JQ Japan - fail
JQ Vietnam - fail
JQ Int - shrinking massively, + ex QF routes (mel - sin, syd - hnl, cns - nrt, cns kix) still a fail
JQ HKG - stop it hurts

Why is Jetstar NZ a fail, it is profitable and has bought low fares to the NZ population. I find it interesting that when a couple of people made the mistake of wishing Qantas out of business lots of Qantas peeps got very upset that people were wanting to see them out of work. Yet on so many posts here people are wishing for ALL those Jetstar employees and families to be pit out of work. Yes Jetstar has had an effect on big brother but to blame it for ALL Qantas' problems is too simplistic and an 'easy' out.

..................

Red Q - Fail
Dual AOC - Fail

I do note the change of language from the likes of Strambie. Stating QF mainline may return to more "premium leisure" destinations. The first two were Gold Coast & Hamilton Island.

Additionally deploying the A330 on SYD-HNL & also increasing it's frequency.

There's been talk of new mainline destinations & returning to previously serviced destinations. It'll be interesting to see how it pans out.

Yes, Jetstar NZ is profitable. Costs of $24.3M with income of $26.8M equals a profit of $2.5M. However the source of income for Jetstar NZ is Jetstar Australia ie. JQ AU pays JQ NZ for labour costs + 10% which is then paid back as profit.
As far as the JQ NZ operation being profitable for the QF group, who knows...
I don't think anyone is wishing anyone else out of a job, but questioning the management that might end in everyone being out of a job is probably appropriate.
If the business case of being the cheapest in the market to make the most money was the right one, then surely the results should be coming in by now...

Even more reason
 

Even more reason to sell Jetstar and set it aside of the Qantas Group....see if it actually can survive...which everyone except QF Management and the media that swallow the constant loads of accounting rubbish..

Only problem with this theory, is that QANTAS has been left in such a perilously weak state from years of neglect and incompetence, that jetstar may end up (with decent management and an improved product) being the perfect competitor to squash QANTAS.

"Only problem with this theory, is that QANTAS has been left in such a perilously weak state from years of neglect and incompetence, that Jetstar may end up (with decent management and an improved product) being the perfect competitor to squash QANTAS."

I wouldnt say competitor more like a constant Leach....9 A320 basking in the Sun in France, 6 regular A320 on the ground in Japan...787 utilisation to the point of ridiculous for a new type...yeah if competition is driving you to bankruptcy due to one part of the "Qantas Group" bleeding you dry then yes..

The genie is out of the bottle now.

If Qantas sells Jetstar, it'll be to cashed up foreign buyers. More than likely the Chinese. These guys don't play the game on short term outlooks and quarterley statements. They play with the next generation in mind. What's best for china.

One thing is for sure, there will be no more protection of Qantas on its highest yielding routes. Jetstar will crush Qantas. It has a cheaper cost base and if it goes upmarket and even rebrands it'll be a big headache.

If Qantas keep Jetstar, it'll probably crush Qantas too.

More bad news being leaked to the AFR, pre 28th August Results?

The AFR is reporting today the possibility of another 2000 to 3000 jobs to go on top of the 5000 already announced.

That last one explicitly denied by Joyce about two hours ago. Words like stability, looking to the future, setting up for growth, were just some of the phrases. Said no more job losses beyond what was announced. Well, that's today's plan anyway. :suspect: Time will tell I guess.

Indicated that the 28th will be the announcement about future direction re frequent flyers sell off, splitting AOCs, etc to do possibly do a virgin and so on. He seemed positive about the future and he freely admitted that he had been worried over the last couple of years but is now much more hopeful. Reckoned things were starting to turn for both domestic and international.

Said things are softer at Jetstar. I just figured they must be in EBA negotiations. :ok:

I guess we'll know in a couple of weeks how honest he was being.

What...Joyce is talking, really?

Were his lips moving?

Keg,

Just out of interest do you have a link or reference for Joyce's statements just now (or were they internal)?

Cheers,
PM

Qantas plan sparks cuts concerns
:ugh::yuk:

Well, better pump it up by giving them more Qantas routes.

beat me to it 600ft-lb I find this piece most interesting
I also find interesting what Jamie Freed says in the video towards the end..

Now a mainstream view, another "fail" to be added to above fail list posts..about 30 sec in the video below...



It feels like he just made it up! No doubt now the management's flawed strategy has damaged the LH business, the board has failed spectacularly in my view. I think LC will be under huge pressure come AGM time.. finally the media may have woken up... well, we will see about that over the coming weeks..

A very sad situation.. but this story is essentially a rehash of what Gareth said the other week, a good effort in trying to unravel his confusing accounting speak.

Yeah Keg, there wasn't anything in the media about it, did you attend a private meeting with him? ;)