‘Stark but not surprising’: Covid-hit Qantas announces $1 billion loss

Qantas has revealed the latest damage bill stemming from the coronavirus pandemic, announcing an eye-watering net loss of A$1.03 billion (NZ$1.1b).

On Thursday morning, Australia’s major airline posted the billion-dollar loss, a stark contrast to the interim profit in the prior year, which before the coronavirus pandemic sat at A$771 million.

Qantas chief executive Alan Joyce said the company is still navigating through the crisis, but the figures were a stark reality of how the pandemic has affected the carrier.

“These figures are stark but not surprising,” Joyce said.

“During the half we saw the second wave in Victoria and the strictest domestic travel restrictions since the pandemic began. Virtually all of our international flying and 70 per cent of domestic flying stopped, and with it went three-quarters of our revenue.”

The airline’s recorded an A$6.9b drop in revenue as a result of Covid-19, representing a 75.4 per cent slump compared to the previous corresponding period.

Earnings before tax, interest, depreciation and amortisation (EBITDA) were A$86m for the period.

Qantas noted its freight business is offsetting the heavy losses of the international flying business and its domestic operating had returned to an underlying positive cash flow position.

“Qantas Freight had a record result and has been a natural hedge to the lack of international passenger flying, which has created a shortage of cargo space globally,” Joyce said.

The airline noted ongoing domestic border closures had dampened its recovery, however the rollout of vaccines is prompting signs that transtasman bookings could begin by the middle of the year.

“The Covid vaccine rollout in Australia will take time, but the fact it’s under way gives us more certainty,” Joyce said.

“More certainty that domestic borders can stay open because frontline and quarantine workers will be vaccinated in a matter of weeks. And more certainty that international borders can open when the nationwide rollout is effectively complete by the end of October.”

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