The Qantas Group has posted its first full year statutory profit since FY19. For the full year 2023 (FY23), the Group achieved an underlying profit before tax of AU$2.47 billion and a Statutory after tax profit of AU$1.74 billion. This compares with AU$7 billion in accumulated statutory losses over three prior years.
Underpinning the profit was completion of the Group’s AU$1 billion recovery programme (launched in the first year of those losses), a 132% increase in flying compared with FY22 and strong travel demand driving significantly higher revenue.
As of June 30, 2023, the Group had liquidity sources of around AU$10 billion, including AY$4.4 billion in cash and undrawn facilities and AU$5.6 billion in unencumbered assets.
Net debt fell to AU$2.89 billion – well below the AU$3.7 billion to AU$4.6 billion target range and the FY19 level of AU$4.7 billion. This exceptional balance sheet strength, combined with cashflows from what is a structurally enhanced business, is expected to underpin future aircraft deliveries and shareholder returns.
The Board of the Group approved a return to shareholders of up to AU$500 million via an on-market share buy-back, which will commence in September 2023. This follows a return of AU$1.0 billion during FY23 via share buy-backs at an average price of AU$6.19.
The Group has announced a firm order for 24 widebody aircraft, consisting of 12 Boeing 787s and 12 Airbus A350s. With deliveries starting in FY27 and continuing into the next decade, these aircraft will replace the bulk of the current A330 fleet, with purchase right options stretching out until at least FY37 to provide flexibility for future growth and, ultimately, replacement of the A380 fleet.
This order secures delivery slots for sought-after wide-body aircraft with pricing that represents an excellent opportunity for the Group. It is in addition to the order for 12 specially modified A350s to operate Project Sunrise flights, arriving in FY26.
The Group’s fleet plan has significant flexibility built in, allowing for adjustments depending on market conditions and its financial framework.
As part of this new order, Qantas will partner with Airbus and Boeing to access to up to 500 million litres of Sustainable Aviation Fuel (SAF) per annum from 2028, including from the United States. This represents up to 90% of the SAF required to reach the Group’s 2030 interim target of 10% of its total fuel needs and enhances the Group’s pathway to reducing emissions. (£1.00 = AU$1.96 at time of publication).
