Qantas boosts weeks-old profit forecast as air-travel rebound accelerates

QANTAS Airways upgraded profit expectations for the final six months of 2022 just weeks after its initial forecast, highlighting the intensity of a demand rebound that has sent fares soaring.

The Australian airline said on Wednesday (Nov 23) it expects underlying profit before tax in the period of between A$1.35 billion (S$1.24 million) and A$1.45 billion. That’s A$150 million higher than the range Qantas provided only on Oct. 13.

The improving outlook, after the financial trauma of the pandemic, allows Qantas to further slash borrowings and increases the chances of more shareholder returns early next year.

Net debt is now expected to fall to between A$2.3 billion and A$2.5 billion by Dec 31, Qantas said. That’s about A$900 million better than the airline expected last month.

“Consumers continue to put a high priority on travel ahead of other spending categories,” Qantas said. “Low levels of net debt put the board in a position to consider future shareholder returns in February.”

Revenue is accelerating due to flight bookings on Qantas and low-cost division Jetstar stretching into early 2023 and beyond, the airline said. BLOOMBERG