After racking up billions of dollars in losses during COVID, Qantas has produced a stunning turnaround, posting an underlying profit of AU$$2.47 billion ($1.63b) for the twelve months ended June 30th, 2023 (FY23).

Photo: Qantas

In FY22, the Qantas Group reported an underlying loss of AU$1.86 billion ($1.23b), and this year came close to doubling the 2019 financial year profit of AU$1.33 billion ($878m). This year marks the first full-year statutory profit since FY19, and since then the Qantas Group has accumulated losses of more than AU$7 billion ($4.62b). Qantas said the profit was underpinned by its now completed AU$1 billion ($660m) recovery program introduced in the first of those loss-making three years.

Domestic flying is the cream on the top

Total revenue reached AU$19.8 billion compared to AU$9.1 billion ($6b) last year and AU$17.97 billion ($1.19b) in pre-pandemic FY19. By segment, Qantas Domestic produced 33% of the revenue, International 37%, Jetstar Group 20% and Qantas Loyalty 10%. Qantas Domestic was the highest profit earner, contributing AU$1.27 billion ($838m) to underlying profit, up from a loss of AU$765 million ($505m) in FY22.

Photo: Ryan Fletcher/Shutterstock

Outgoing Qantas Group CEO Alan Joyce said the results show a substantial turnaround in finances and service over the last year, adding that customer satisfaction had improved significantly over the year.

"Flight delays and cancellations have largely returned to pre-COVID levels and we've shifted from heavy losses to a strong profit and pipeline of investment worth billions of dollars.

"We safely flew almost 70 billion more seat kilometers and doubled the number of people we carried to 46 million compared to the year before. It's because we're in a strong financial position that we're able to invest in new aircraft, new destinations and new training facilities - all things that will make us better in the future."

Domestic flying, which includes Qantas, QantasLink and Jetstar, increased to 103% of pre-COVID levels by the end of FY23, while international grew from 54% to 81% of pre-COVID levels during the twelve months. During FY23, the Group returned seven refurbished Airbus A380s to service, took delivery of two new Boeing 787 Dreamliners and added eight A321LRs.

Photo: Mitchul Hope via Flickr.

As has been the case for some time, Qantas Loyalty produced strong results to record an underlying profit of AU$451 million ($298m) on revenue of AU$2.19 billion ($1.44b). There are now more than 15.2 Qantas Frequent flyer members, with more than one million joining in the last financial year and 17% more members than in pre-pandemic 2019.

The Group finished FY23 with 336 aircraft: 126 in the Qantas fleet, 119 with QantasLink, 81 with the Jetstar Group and 10 flying for Qantas Freight. Qantas also announced today that it has placed firm orders for 12 Airbus A350 and 12 Boeing 787 Dreamliners as it phases out the 28 Airbus A330 widebodies fleet. It has also acquired a number of purchase-right options that give it flexibility for the future retirement of the ten A380s now in the Qantas International fleet.

The big giveaways

While making such a huge profit is great news for the airline, its shareholders and Airbus and Boeing, it might leave a lot of customers feeling peeved about the high airfares they have been paying to produce those profits. Interestingly Qantas also announced today sales on more than 90 destinations with more than one million seats on sale.

Photo: Ohmid Behzadpour / Shutterstock

Qantas fares will be discounted by up to 40%, including return flights from Sydney to London for AU$1799 ($1188) and Melbourne to Los Angeles for AU$1199 ($792). Jetstar sale fares start from as low as AU$29 ($20) one way and Jetstar international flights from AU$145 ($96) one way.

The airline is also gifting more than a billion Qantas Points to frequent flyers who have flown at least one Qantas flight in the past 12 months. Eligible customers will receive an email inviting them to choose between 1,000 points or 30 Status Credits, while those who flew ten times or more will be offered 5,000 points or 75 Status Credits. Of course there are plenty of terms and conditions, and all the information is available on the Qantas website.

What do you think about this massive turnaround by Qantas? Let us know in the comment section.