Strikes batter Qantas earnings
AUSTRALIA’S top airline Qantas Airways this morning posted a 51.5 per cent fall in first-half underlying profit after a bitter industrial dispute and high fuel bills took their toll and said it planned job cuts to offset challenging conditions.
Qantas, which suspended all flights for two days last year to bring a battle with unions to a head, said underlying profit before tax fell to A$202m (£137.6m) compared with A$417m a year ago. Analysts, on average, had expected earnings of around A$176m.
The global airline industry has been struggling to pass on higher fuel costs to customers as demand for business and leisure travel dwindles due to the global economic slowdown.
Qantas said it would withdraw some international services, retire early some aircraft, undertake to build a more competitive engineering operation and make changes to its catering business.
It added these changes would result in job losses. It did not specify the scale of job losses.
“We are making the right decisions to restore, retain and increase our efficiency and competitiveness and enhance long term shareholder value,” said chief executive Alan Joyce in a statement this morning.
In November, Qantas said it expected an underlying profit before tax of between A$140m and A$190m in the six months to December, forcing analysts to slash forecasts.
Qantas has said strikes, the grounding of its fleet and high fuel bills have cost it more than A$650m.