airlinesqantasThird Quarter FY19

first_imgairlinesqantasThird Quarter FY19 The Qantas Group has delivered revenue growth in the third quarter of FY19 and says it remains on track to fully offset the impact of significantly higher fuel costs compared with last year. Total revenue between 1 January and 31 March 2019 grew by 2.3 per cent to $4.4 billion and Group Unit Revenue was up by 4 per cent.Qantas’ overall market share of corporate travel revenue increased by 2.5 percentage points in the quarter to its highest level in three years, despite a net reduction in capacity. Market share of small-to-medium business travel continued to grow, assisted by initiatives from Qantas Loyalty.Group International Unit Revenue increased by 6.2 per cent, with a particularly robust performance by Qantas International. Network changes drove revenue performance, as did competitor capacity reductions on long haul routes in response to higher fuel costs, which in-turn led to increased market share for Qantas International.Performance of Jetstar’s international services was heavily impacted by the timing of Easter and school holidays, with a significant amount of demand shifting to April. Despite this, Unit Revenue continued to grow. The broader Jetstar Group saw an 8 per cent increase in ancillary revenue per passenger in the third quarter, supported by new luggage options and Club Jetstar membership.Qantas Loyalty continued to see strong revenue growth from the Frequent Flyer program as well as its other businesses, including Qantas Money and Qantas Insurance. There are several initiatives to be announced in the fourth quarter that will continue to support Loyalty’s performance, with earnings growth of 7-10 per cent expected for the second half of FY19.Qantas and Melbourne Airport have also reached an agreement for the sale of the airline’s domestic terminal, and the airline has secured future access to Terminal 1 for $355 million, of which $276 million will be received in cash in this financial year, with the remaining value to be accrued in future periods.The transaction includes a 10-year access agreement for Terminal 1 with all aeronautical and retail assets transferring to Melbourne Airport. Qantas retains exclusive access to Terminal 1, including lounges, for domestic services. Options to operate some international flights from Terminal 1 outside of peak domestic times will be assessed.While the proceeds from this sale will be accounted for in FY19, the gain will be excluded from Underlying Profit Before Tax and, as advised at 1H19, contained within the Group’s net capital expenditure guidance.last_img

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