Sydney - Australian flag carrier Qantas has bounced back into the black, the airline announced on Thursday, with a modest annual net profit boosted by cost-cutting and its alliance with Emirates.
The airline posted a profit of A$5 million ($4.5-million) in the 12 months to June 30, a major improvement on the historic A$245-million loss the previous year, when high fuel costs and industrial action hammered the bottom line.
Its underlying profit before tax - the airline's preferred measure of financial performance - was A$192-million, up from A$95-million.
“The market is very tough. But we are focused on the elements we can control,” said chief executive Alan Joyce as the carrier recovered from its first annual loss since privatisation in 1995.
“We have Australia's leading airlines and loyalty business - and we have a clear strategy to build an even stronger business for the future.”
The group's troubled international division remained a weight on the company, posting a loss of A$246-million in the year to June.
But that compares with a loss of A$484-million the previous year, signalling that Joyce's strategy of scrapping less profitable routes, expanding into Asian markets and hooking up with Dubai-based Emirates is paying dividends.
“We have made considerable progress with our turnaround plan for Qantas International and we remain on track towards our target for the business to return to profit in FY15,” Joyce said.
Under the Emirates alliance, Qantas has shifted its hub for European flights to Dubai from Singapore, which Joyce said had given the group a strengthened position on routes to Europe, the Middle East and North Africa.
“Bookings have been very positive, running at about twice the level of Qantas's previous codeshare arrangements for flights to Europe,” he said, adding that the full benefits were expected to flow from 2015.
“We have reduced Qantas International's cost base by 5 percent, having withdrawn from loss-making routes, retired ageing aircraft and completed the reconfiguration of nine Boeing 747s and all 12 of our A380s, resulting in improved fleet economics.”
He added that the group's focus “remains squarely on making Qantas International a competitive and sustainable business that can ultimately grow again”. - Sapa-AFP