The Qantas Group continued to deliver strong earnings in a mixed market in the first half of full-year 2020 (FY20), with an underlying profit before tax of AU$771 million and a statutory profit before tax of AU$648 million.
The underlying result was AU$4 million less than the same period last year – despite AU$51 million in higher foreign exchange related cost impacts, a AU$68 million impact from global freight weakness and disruption in Hong Kong, and a AU$55 million increase in operating costs from the sale of domestic airport terminals.
The Qantas Group has taken immediate action in response to demand weakness as a result of the evolving Coronavirus situation, focused chiefly on capacity management. Qantas Group CEO Alan Joyce said: “Coronavirus resulted in the suspension of our flights to mainland China and we’re now seeing some secondary impacts with weaker demand on Hong Kong, Singapore and to a lesser extent, Japan. Other key routes, like the U.S. and U.K., haven’t been impacted.”
“We’re taking action now to limit our exposure to softening markets. The Group’s total capacity to Asia will reduce by 15% from now until at least the end of May and Qantas’ only route to mainland China (Shanghai) will remain suspended for the same period.” (US$1.00 = AU$1.51 at time of publication.)