In the first half of the financial year 2025, Qantas Group and Jetstar, are experiencing massive growth. This growth exceeded initial projections, demonstrating strong performance across their networks. Specifically, Jetstar Domestic saw a significant rise in revenue per unit due to increased travel interest. Additionally, Qantas Domestic reported year-on-year improvements in passenger load factors and corporate travel.
For the first half of FY25, the Group anticipates a 3-5% increase in Domestic Revenue per Available Seat Kilometer (RASK) compared to the previous year. Conversely, International RASK may experience declines of 7-10%, reflecting ongoing market challenges. Nonetheless, Qantas Loyalty remains a strong performer, particularly after the recent launch of Classic Plus Flight Rewards. This loyalty program predicts at least a 10% increase in underlying EBIT for FY25, despite some expected adjustments in fair value impacting earnings this first half.
However, the Group faces fuel price volatility, influenced by geopolitical factors that could affect operational costs. Qantas estimates its fuel expenditure for the first half of FY25 will reach approximately $2.55 billion. This figure accounts for hedging and carbon costs. Notably, the Group maintains robust hedging strategies, allowing it to benefit from any potential drops in jet fuel prices.
As a gesture of appreciation, about 27,000 Qantas Group employees will receive a total of $28 million in “thank you” payments recorded in the first half of FY25. Furthermore, the ongoing $400 million on-market share buy-back, initiated after the FY24 results, has progressed significantly. The program is 45% complete, with an average share price of $7.23, and aims for completion by December 31, 2024. Overall, Qantas Group shows resilience and strong growth prospects as it navigates a dynamic travel environment.
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