Qantas updates profit forecast.
Qantas has just issued a profit downgrade due to a “weakening revenue environment,” including a predicted $450 million full year loss for Qantas International.
The overall underlying group profit is expected to be in the range of $50-$100 million for the full year to 30 Jun, reflecting “the recent deterioration in global aviation operating conditions driven by the European economic crisis, the Group’s highest ever jet fuel bill, and substantial capacity increases in the domestic market that have reduced yields”.
The forecast $450m international loss is more than double the $216m deficit for the division last year, with structural issues in the business compounded by global economic factors “as well as the $100 million one-off cost of industrial action”.
Domestically both Qantas and Jetstar will deliver improved results compared to the previous year, and the overall profit is also supported by the strong performance of Qantas Frequent Flyer.
CEO Alan Joyce said the company had taken decisive action to mitigate losses, with the new Group structure with dedicated ceos for Qantas International and Qantas Domestic set to “bring further rigour to our business”.
More information in today’s Travel Daily.