Qantas sees profit drop following reputational damage

Australian carrier Qantas has reported a 16 per cent year-on-year decline in profits for the 2024 financial year, according to results published on Thursday (29 August).

Covering the 12 months to 30 June 2024, the carrier posted an underlying profit before tax of AU$2.47 billion (down 16 per cent year on year) and a statutory after-tax profit of AU$2.35 billion (down 28 per cent compared to 2023).

Revenue across its international business also fell to AU$755 million, while revenues for its domestic business, which include budget carrier Jetstar, saw a 14 per cent year-on-year increase to AU$1.36 billion.

Qantas reported a return to pre-Covid international capacity in May 2024, which included the introduction of two new A380 aircraft. Revenue, however, was offset by an increase in competitor capacity, the carrier said, which resulted in an 11 per cent reduction in unit revenue.

The carrier added that the performance if its Perth-London, Perth-Rome and its recently launched Perth-Paris routes “continue to provide confidence” ahead of the anticipated launch of non-stop flights to London and New York from Melbourne or Sydney.

The FY24 result reflects a difficult period for the carrier, which has suffered severe reputational damage following a malpractice lawsuit involving the sale of tickets for cancelled flights in 2022.

The carrier said its diminished earnings were the result of lower fares, weaker freight revenue and increased spending on “customer initiatives”, which included a recent AU$80 million investment to address customer “pain points”.

Commenting on the FY24 result, Qantas CEO Vanessa Hudson said: “Our focus this year has been getting the balance right in delivering for customers, employees and shareholders while building a better, stronger Qantas Group.

“Restoring trust and pride in Qantas as the national carrier is our priority, and while there’s more work to do, we’ll get there by delivering for our customers and people consistently in the future.”