Qantas Airways Limited (ASX:QAN) FY18 profit jumps 15% to $980 million

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ASX:QAN

Qantas Airways Limited (ASX: QAN) has reported a full-year net profit to $980 million, an increase of 15%, which it says was helped by strong performances from the domestic flying business of Qantas and Jetstar.

Results Highlights

  • Net profit up 15% to $980 million
  • Underlying profit before tax up 14% to $1.6 billion
  • Final dividend of 10cps vs 7.0cps year ago

Australia’s major airline posted a record underlying profit before tax of $1.6 billion, up 14%, while revenue and other income rose 6.2%t to $17.06 billion.

The group’s domestic flying division delivered earnings of $1.1 billion, a 25% jump from the previous year, due to more seats being squeezed on planes, particularly its Jetstar A320.

Qantas international business increased its earnings by 7% to $399 million and maintained its earnings.

The airline has declared a fully-franked final dividend of 10 cents per share, up 3 cents from a year earlier, while a share buyback program is ongoing.

Chief executive Alan Joyce said the record profit reflected a strong market as well as the benefits of ongoing work to improve the business and build long-term shareholder value, but warned of challenges ahead.

“We’re facing another increase to our fuel bill for 2018/19 and we’re confident that we will substantially recover this through a range of capacity, revenue and cost efficiency measures, measures, in addition to our hedging program,” he said in a statement.

Outlook

Qantas did not provide a specific guidance for 2018/19, but said its fuel bill is expected to jump by $690 million to $3.9 billion, while group expenditure would rise by around $250 million.

It expects transformation benefits of $400 million in the current financial year.

The Qantas share price closed 1.61% lower at $6.72 on Wednesday.

Since the beginning of 2018, the Qantas Airways Limited share price has climbed 33.33%, compared to the S&P/ASX 200 Index, which has gained 3.31% in the period.

with AAP 

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Lauren Surplice is a keen follower of the stock market, investing in individual companies and funds. She follows the daily stock market news, covering the ASX stocks that are moving the markets. You can contact Lauren at laurens@thecapitalclub.com.au