Qantas announced its annual financial results on Thursday, disclosing a significant decline in pre-tax underlying profit to $2.06bn in the year ending 30 June. The airline attributed the contraction primarily to higher fuel expenses, which were exacerbated by geopolitical tensions affecting energy prices. Chief Executive Vanessa Hudson indicated the company would continue pursuing revenue growth opportunities, stating management would “push to maximise revenue and clearly, obviously, maximise earnings” despite strong passenger demand persisting amid cost-of-living pressures.
Fuel cost pressures have prompted operational adjustments to the fleet. Qantas accelerated its retirement timeline for the A380 aircraft to 2028, four years earlier than previously planned, citing expected increases in maintenance expenses and potential service disruptions. The company simultaneously outlined plans to acquire up to 20 additional aircraft starting in 2030, with consideration being given to Airbus A350-1000s and Boeing 787 Dreamliners as part of a broader fleet modernization initiative.
Qantas’s budget subsidiary Jetstar is central to the company’s profit recovery strategy. Jetstar recently introduced fees for carry-on luggage placement in overhead compartments, a move that drew criticism from consumer advocates. Leadership indicated further expansion of ancillary charges was forthcoming, with plans to unbundle additional services from base ticket prices while maintaining lower advertised fares. Non-seat related fees, encompassing checked baggage, seat selection, cancellation flexibility and food services, currently generate over $1bn of Jetstar’s $6bn annual revenue, with management projecting significant increases.
Across the broader airline group, overall revenue climbed 7% to $25.5bn during the 12-month period, though elevated fuel costs of $610m offset gains. The loyalty program contributed $625m to underlying earnings, reflecting 6% growth in active members. Despite the profit decline, Qantas’s share price rose more than 4% in early afternoon trading following the announcement.
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