Qantas has announced a double-digit profit plunge three weeks after slashing former CEO Alan Joyce’s pay package by $9million.
The national carrier under new chief executive Vanessa Hudson has reported a 28 per cent fall in statutory net profit after tax, taking it down to $1.25billion for 2023-24.
Ms Hudson used her first results presentation to distance herself from her controversial predecessor Mr Joyce, who was in charge when customers were sold tickets for cancelled flights.
‘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 into the future,’ she said on Thursday.
Qantas told shareholders earnings had fallen during the last financial year because of lower fares, more spending on customer loyalty programs, increased competition for international flights and reduced freight revenue.
Ms Hudson who replaced Mr Joyce in September last year, was CEO when her airline in May made a deal with the n Competition and Consumer Commission to pay $120million in fines for selling tickets for cancelled flights to 87,000 customers.
Earlier this month, Qantas announced it would reduce Mr Joyce’s remuneration by $9.26million, mainly through cancelling long-term incentives.
Before he was stripped of those long-term incentives, the former CEO had a total remuneration of $11.919million in 2022-23, including a base salary of $2.145million.
In a bid to win favour with workers, Qantas has offered 23,000 non-executive employees a $500 staff travel voucher to go towards already heavily discounted standby fares.
This was on top of a $500 voucher provided to employees in February, bringing the total to $1,000 for the year.
‘Our focus this year has been getting the balance right in delivering for customers, employees and shareholders while building a better, stronger Qantas Group,’ Ms Hudson said.
‘I want to thank every one of our people for the professionalism, hard work and commitment to delivering for our customers.’
Ms Hudson was confident ns would be more inclined to travel during the coming year, despite the cost-of-living crisis.
‘These investments come at a time when ns are continuing to prioritise travel over other spending categories, with intention to travel over the next 12 months remaining high,’ she said.
The Qantas Group, which also includes budget carrier Jetstar, returned to pre-Covid international capacity in May 2024, following the return of more aircraft including two Airbus A380s.
But additional flights also coincided with more competition, leading to an 11 per cent fall in revenue for the international flight division.
In its announcement to the n Securities and Investments Commission, Qantas said it expected international unit revenue to fall by 7 to 10 per cent in the first half of 2024-25, as revenue from domestic flight operations fell by 2 to 4 per cent.
The airline’s underlying profit before tax – an indication of what a company believes better reflects its earnings – showed a 15.7 per cent decline to $2.078billion.
Revenue, however, had increased by 10.7 per cent to $21.939billion.