Tag Archives: QANTAS Airways

QANTAS buys 51% of TripADeal

QANTAS Group has made this announcement:

  • Qantas buys 51 percent stake in fast-growing online travel business
  • Plans to significantly grow TripADeal’s revenue through a close partnership with Qantas Loyalty
  • Frequent Flyers can now use Qantas Points for any TripADeal holiday package

Qantas Frequent Flyers can now use their points on a huge range of holiday packages in a deal that sees the national carrier take a majority shareholding in the Australian-made travel business, TripADeal.

The stake allows Qantas Loyalty to immediately expand its exposure to the estimated $13 billion online packaged holiday booking market, which is experiencing significant growth as leisure demand booms and the shift to e-commerce continues.

Over the past decade, TripADeal has built thousands of direct supplier relationships with hotels, tour operators and other vendors that allow it to offer well-priced holiday packages both domestically and overseas. They also have their own tour guides based in over 30 countries.

TripADeal packages range from African safaris, Japanese ski trips and exploring Antarctica, to South Australian wine tasting tours and Bali beach holidays.

All of these ready-made holidays can now be booked using Qantas Points, regardless of which airline is part of the package. Frequent Flyers will also earn three points for every $1 they spend with TripADeal and can also use ‘points plus pay’ to make their holiday happen sooner.

The combination of TripADeal’s success at curating holiday packages together with the reach of Qantas Loyalty’s 14-million member base, plus the opportunity to redeem and earn points, is projected to drive a significant increase in TripADeal’s revenue in the next few years.

Pre-COVID, TripADeal had an annual growth rate of more than 40 per cent and in the 12 months prior to the pandemic, bookings were in excess of $200 million.  Monthly bookings are now significantly higher.

Qantas joins existing shareholders, the founders of TripADeal and private equity firm BGH Capital, which bought a stake in 2020.

The full terms of the all-cash purchase are commercial in confidence. The agreement provides a mechanism for Qantas to acquire the remaining 49 per cent of TripADeal in four years at an agreed multiple of TripADeal’s bookings at the time.

QANTAS aircraft photo gallery:

QANTAS to acquire Alliance Aviation (Alliance Airlines)

QANTAS Airways has made this announcement:

Qantas has reached an agreement to fully acquire Australian-based operator, Alliance Aviation Services Ltd (Alliance Airlines), enabling the national carrier to better serve the growing resources sector.

The agreement, which is subject to a vote from Alliance shareholders and competition clearance, would see Alliance become a wholly-owned part of the Qantas Group.[1]

There is no change to Qantas’ arrangements with Alliance as a result of today’s announcement given the approvals required, which would take a minimum of several months to secure.

Alliance has a fleet of 70 jet aircraft that seat up to 100 people each, making them well suited to charter operations. Between these charter services and a small number of passenger routes that overlap with large mine sites, Alliance accounts for around 2 per cent of the total domestic market.

The national carrier is Alliance’s biggest single customer, with a long-term agreement that sees Alliance operate up to 18 newly acquired E190 jets for QantasLink. This arrangement has helped open new direct routes and increase frequency across regional Australia.

Qantas bought just under 20 per cent of Alliance in February 2019 and at the time flagged its long-term interest in acquiring 100 per cent of the airline. The ACCC investigated that minority holding for three years and made no findings that it lessened competition.

Under the agreement announced today, the remaining 80 per cent would be acquired through a scheme of arrangement where Alliance shareholders receive Qantas shares worth $4.75[2] for each Alliance share they hold[3], representing a 32 per cent premium to Alliance’s volume weighted average price for the past three months. Qantas would issue new shares valued at approximately $614 million in a transaction that is expected to be EPS accretive for Qantas shareholders, before synergies.

Qantas has advised the ACCC of today’s announcement and provided detail of the anticipated benefits to customers. Qantas will continue to update the market on expected completion timing as the competition clearance and Alliance shareholder vote processes progress.

CEO Commentary

Qantas Group CEO Alan Joyce said acquiring the remaining shares in Alliance would mean QantasLink can better compete in the highly competitive charter segment, particularly given the shared fleet type of Fokker aircraft.

“Alliance’s fleet of Fokker aircraft are perfect for efficiently serving resources customers in WA and Queensland. They also have a big inventory of spare parts that would significantly extend the practical life of a combined fleet of around almost 70 Fokkers.

“Keeping these aircraft operating reliably for longer than either carrier could achieve by themselves will help keep costs down, which is ultimately good news for charter customers. There are also benefits from bringing together our operations planning and training facilities.

“The resources sector continues to grow and any new tender for airline services will be very competitive. It makes a lot of sense for us to combine with Alliance to improve the services we can offer, which is a positive for both airlines as well as the travelling public.

“We’ve opened up several new passenger routes using up to 18 of Alliance’s E190s, so bringing all 33 of these aircraft, plus their crews, into the Qantas Group would really expand what we could achieve.

“We plan to extend our program of guaranteed lower fares for residents in those few communities where Alliance operates its own passenger services, as well as access to our Frequent Flyer program,” added Mr Joyce.

[1] The agreement is a Scheme Implementation Deed, a copy of which is attached to the ASX announcement detailing the acquisition of same date by Alliance.

[2] The scheme consideration will be reduced by the amount of any dividends paid by Alliance in the ordinary course from now until completion of the acquisition.

[3] The number of Qantas shares received by Alliance shareholders will be determined using the volume weighted average price of Qantas shares in the 20 business days prior to the scheme record date (prior to transaction completion).

Alliance Airlines Route Map:

Alliance Airlines aircraft photo gallery:

QANTAS announces it will order 12 Airbus A350-1000s, 20 A220s and 20 A321XLRs

Airbus made this announcement:

Qantas Group has confirmed that it will order 12 A350-1000s, 20 A220s and 20 A321XLRs. The news was announced at a ceremony in Sydney attended by Qantas Group CEO Alan Joyce and Airbus Chief Commercial Officer and Head of Airbus International, Christian Scherer.

The A350-1000 was selected by Qantas following an evaluation known as Project Sunrise and will enable the carrier to operate the world’s longest commercial flights. These will include linking Sydney and Melbourne with destinations such as London and New York non-stop for the first time ever. Featuring a premium layout, the A350 fleet will also be used by Qantas on other international services. The A350-1000 is powered by the latest generation Trent XWB engines from Rolls-Royce.

In the single aisle category the A220 and A321XLR were chosen under an evaluation called Project Winton. The aircraft will be used by the Qantas Group on domestic services across the country, which can extend to over five hours. In addition, the A321XLR offers the range capability for flights from Australia to South East Asia, enabling the Qantas Group to open up new direct routes. The A220 and A321XLR fleets will both be powered by Pratt & Whitney GTF engines.

This agreement is in addition to the existing order for 109 A320neo Family aircraft, which includes the A321XLR for the Qantas Group low cost subsidiary Jetstar.

Qantas Group CEO Alan Joyce said: “New types of aircraft make new things possible. That’s

what makes today’s announcement so significant for the national carrier and for a country like Australia where air travel is crucial. The A350 and Project Sunrise will make any city just one flight away from Australia. It’s the last frontier and the final fix for the tyranny of distance.”

“The A320s and A220s will become the backbone of our domestic fleet for the next 20 years, helping to keep this country moving. Their range and economics will make new direct routes possible. “The Board’s decision to green light what is the largest aircraft order in Australian aviation is a clear vote of confidence in the future of Qantas.”

The A220, A321XLR and A350 are the market leaders in their respective size categories. In addition to offering the highest levels of passenger comfort, the aircraft bring a step change in efficiency, using up to 25% less fuel, a similar reduction in carbon emissions and a noise footprint 50% lower than  previous generation aircraft.

All in-production Airbus aircraft are certified to fly with a 50% sustainable aviation fuel (SAF) blend, with a target to increase this to 100% by 2030.

QANTAS issued this statement:

Australia’s national carrier has today confirmed an order for 12 Airbus A350-1000s to conquer the final frontier of long-haul travel and enable non-stop flights to Australia from any other city including New York and London from late 2025.

Codenamed Project Sunrise for the airline’s long history of endurance flying, Qantas has also shared preliminary concepts for its A350 cabin of the future that will offer a new level of comfort for all passengers on these direct flights that will cut up to four hours off total travel time compared with one-stop options today.

Customers onboard Qantas’ new fleet of A350 aircraft will be treated to luxurious First Class suites with a separate bed, recliner lounge chair and personal wardrobe; a next-generation Business suite; a new Premium Economy seat pitched at 40 inches, a new Economy seat pitched at 33 inches; and a dedicated Wellbeing Zone designed for movement, stretching and hydration. It has a total seat count of 238, the lowest compared with any other A350-1000 currently in service.

Global travelers can expect more direct routes to Australia, significantly reduced point-to-point travel time and a flying experience second to none – with a cabin interior and service design influenced by medical and scientific research carried out on three Project Sunrise research flights from New York and London to Sydney in 2019.

CEO COMMENTS

Qantas Group CEO Alan Joyce said: “For more than 100 years, Qantas has been at the forefront of transforming the way the world travels, particularly through direct flights. Now, the A350 and Project Sunrise will make almost any city in the world just one flight away from Australia. It’s the last frontier and the final fix for the tyranny of distance that has traditionally challenged travel to Australia.

“Our direct Perth-London flights started in 2017 and showed strong demand for the convenience and time savings from this kind of travel if the product and service is right. Pre-COVID it was the longest route on our network and had the highest customer satisfaction on our network. All signs point to that demand increasing post-COVID.

“The Qantas A350 travel experience will be truly exceptional, particularly across the premium cabins. Our First and Business Class Seats will set a new benchmark for premium long-haul travel.

“The first Project Sunrise flights will be from New York and London, but the aircraft will also be able to operate non-stop flights to Australia from destinations such as Paris and Frankfurt.

“The Australian national carrier also announced the renewal of its narrow body jets as part of Project Winton with firm orders for 20 Airbus A321XLRs and 20 A220-300s as its Boeing 737s and 717s are gradually retired.

“All of these next generation aircraft – through their lower emissions, longer range, less noise and better economics – will improve how people travel around Australia and overseas.”

PROJECT SUNRISE

  • Will carry 238 passengers across four classes (First, Business, Premium Economy, Economy), with more than 40 per cent of the cabin dedicated to premium seating.
  • The cabin is specially configured for improved comfort on long flights and includes a Wellbeing Zone in the centre and more spacious seating in Premium Economy and Economy cabins.
  • Will be carbon neutral, with all emissions offset.

QANTAS to open a New seasonal Adelaide to Albury route in July

QANTAS Airways has made this announcement:

  • New seasonal Adelaide to Albury route to launch in July
  • Sale fares to Adelaide available from $179 one-way for limited time
  • Boost to Albury-Brisbane services in response to strong demand

Residents of Albury-Wodonga will be able to take advantage of a direct link to South Australia this winter as Qantas launches a new seasonal route between Adelaide and the border city.

From July 8 to September 25, 2022, the national carrier will operate two weekly return flights between Adelaide and Albury with its 50-seat Q300 aircraft.

The new service will be the only direct connection between South Australia and Albury, saving travellers more than three hours on a return flight compared to alternative flight options via Sydney or Melbourne.

For South Australians, the new route opens up a gateway to their closest snowfields, Falls Creek and Hotham in Victoria, for the ski season.

The new route will mean that Albury has direct connections to four capital cities with Qantas for the first time – Sydney, Brisbane, Melbourne and Adelaide.

Qantas will also increase return services between Albury and Brisbane from 7 to 10 each week, in response to strong demand on the route since Queensland’s border reopened late last year.

Other news:

Qantas and Jetstar will grow their international network out of Sydney, with new direct routes to India and Korea taking off this year, accelerating New South Wales’ post-COVID tourism recovery.

Sydney to Bengaluru (Bangalore) direct

Qantas will operate four weekly return flights from Sydney to Bengaluru (formerly known as Bangalore) from 14 September, using its widebody Airbus A330 aircraft.

These will be the first non-stop flights between Australia and southern India by any airline and will cut almost three hours off the current fastest travel time from Sydney to Bengaluru, a growing technology and financial services hub.

With a population of 13 million people, the Bengaluru community has strong connections to Australia for both business travel and people visiting friends and relatives. These trade connections are expected to strengthen following the recent announcement of the Australia-India free trade agreement.

Qantas will continue to operate up to five flights a week between Melbourne and Delhi, making it the only airline offering direct flights between Australia and both northern and southern India.

Planned codeshare agreement set to open up India 

Qantas intends to enter into a codeshare agreement with IndiGo, India’s largest domestic carrier, which will give customers improved one-stop access to more than 50 Indian cities.

The proposed agreement will mean Qantas passengers can transit seamlessly from Qantas flights in Bengaluru, Delhi, or Singapore onto IndiGo services to other major Indian cities as well as smaller ones such as Pune and Goa.

Under the planned agreement, Qantas Frequent Flyers will be able to earn and redeem points on connecting IndiGo flights (QF code only) and IndiGo will recognise Qantas Frequent Flyer benefits for tiered members (Silver, Gold, Platinum and Platinum One) including priority check-in, additional baggage allowance and priority baggage.

Qantas customers travelling on IndiGo will enjoy the same baggage allowance for the entire journey as well as complimentary food and drinks.

The partnership will extend to Jetstar customers who will be able to book connecting flights on IndiGo services through its Jetstar Connect platform on jetstar.com from late April.

New direct services to South Korea

Qantas and Jetstar will both launch direct flights to Seoul’s Incheon International Airport later this year, providing business, premium leisure and low-cost travel options between Australia and Korea.

Jetstar will become the only low-cost carrier to fly direct to South Korea from Sydney, with Boeing 787-8 Dreamliner flights operating from 2 November 2022 three times per week.

Qantas will begin direct flights between Sydney and Seoul from 10 December 2022 with its A330 aircraft, marking the first Qantas scheduled service to Seoul since January 2008.

The launch of these new direct services recognises the increasing popularity of South Korea as a must-see destination for Australians, with its rich cultural history, vibrant nightlife, and incredible food. In return, South Korean travellers – who pre-COVID travelled more frequently than any other nation in the Asia Pacific – consistently rank Australia as the top destination they want to visit.

Qantas Group international restart

Since Australia’s borders re-opened last November, led by New South Wales, the Qantas Group has carried almost 500,000 passengers on its international services across 27 international routes, with another six routes restarting next week.

Group international capacity is expected to reach more than 40 per cent of pre-COVID capacity in April.

Qantas has now added six new overseas routes in the past six months, including Perth-Rome and Melbourne-Delhi, Melbourne-Dallas Fort-Worth and Darwin-Dili as it taps into new markets.

All three new routes announced today are being supported by the NSW Aviation Attraction Fund, which is co-funded by the State Government and Sydney Airport. Kempegowda International Airport has also supported Qantas’ Sydney-Bengaluru flights.

 

QANTAS and Jetstar expand Sydney gateway with new flights to India and South Korea

QANTAS Airways has made this announcement:

  • Qantas to launch new direct route between Sydney and Bengaluru (Bangalore) in southern India.
  • Planned codeshare agreement with India’s largest domestic airline, IndiGo, to provide direct connections to 50 cities; new free trade agreement expected to strengthen demand.
  • Qantas and Jetstar to both launch new direct flights between Sydney and Seoul.

Qantas and Jetstar will grow their international network out of Sydney, with new direct routes to India and Korea taking off this year, accelerating New South Wales’ post-COVID tourism recovery.

Sydney to Bengaluru (Bangalore) direct

Qantas will operate four weekly return flights from Sydney to Bengaluru (formerly known as Bangalore) from 14 September, using its widebody Airbus A330 aircraft.

These will be the first non-stop flights between Australia and southern India by any airline and will cut almost three hours off the current fastest travel time from Sydney to Bengaluru, a growing technology and financial services hub.

With a population of 13 million people, the Bengaluru community has strong connections to Australia for both business travel and people visiting friends and relatives. These trade connections are expected to strengthen following the recent announcement of the Australia-India free trade agreement.

Qantas will continue to operate up to five flights a week between Melbourne and Delhi, making it the only airline offering direct flights between Australia and both northern and southern India.

Planned codeshare agreement set to open up India 

Qantas intends to enter into a codeshare agreement with IndiGo, India’s largest domestic carrier, which will give customers improved one-stop access to more than 50 Indian cities.

The proposed agreement will mean Qantas passengers can transit seamlessly from Qantas flights in Bengaluru, Delhi, or Singapore onto IndiGo services to other major Indian cities as well as smaller ones such as Pune and Goa.

Under the planned agreement, Qantas Frequent Flyers will be able to earn and redeem points on connecting IndiGo flights (QF code only) and IndiGo will recognize Qantas Frequent Flyer benefits for tiered members (Silver, Gold, Platinum and Platinum One) including priority check-in, additional baggage allowance and priority baggage.

Qantas customers traveling on IndiGo will enjoy the same baggage allowance for the entire journey as well as complimentary food and drinks.

The partnership will extend to Jetstar customers who will be able to book connecting flights on IndiGo services through its Jetstar Connect platform on jetstar.com from late April.

New direct services to South Korea

Qantas and Jetstar will both launch direct flights to Seoul’s Incheon International Airport later this year, providing business, premium leisure and low-cost travel options between Australia and Korea.

Jetstar will become the only low-cost carrier to fly direct to South Korea from Sydney, with Boeing 787-8 Dreamliner flights operating from 2 November 2022 three times per week.

Qantas will begin direct flights between Sydney and Seoul from 10 December 2022 with its A330 aircraft, marking the first Qantas scheduled service to Seoul since January 2008.

The launch of these new direct services recognizes the increasing popularity of South Korea as a must-see destination for Australians, with its rich cultural history, vibrant nightlife, and incredible food. In return, South Korean travelers – who pre-COVID travelled more frequently than any other nation in the Asia Pacific – consistently rank Australia as the top destination they want to visit.

Qantas Group international restart

Since Australia’s borders re-opened last November, led by New South Wales, the Qantas Group has carried almost 500,000 passengers on its international services across 27 international routes, with another six routes restarting next week.

Group international capacity is expected to reach more than 40 per cent of pre-COVID capacity in April.

Qantas has now added six new overseas routes in the past six months, including Perth-Rome and Melbourne-Delhi, Melbourne-Dallas Fort-Worth and Darwin-Dili as it taps into new markets.

All three new routes announced today are being supported by the NSW Aviation Attraction Fund, which is co-funded by the State Government and Sydney Airport. Kempegowda International Airport has also supported Qantas’ Sydney-Bengaluru flights.

QANTAS adds four new domestic routes, the A380 to return to Melbourne

QANTAS Airways launched four new routes across its domestic network on March 28, boosting connectivity between regional centers and capital cities.

The new routes – Adelaide-Newcastle, Brisbane-Wagga Wagga, Darwin-Townsville and Darwin-Cairns – provide direct connections and reduce travel time for customers. The national carrier is also the only airline to offer direct flights on two of the routes, between Adelaide and Newcastle and Brisbane and Wagga Wagga.

Three weekly return flights will operate on Darwin-Townsville, Brisbane-Wagga and Adelaide-Newcastle with four weekly return flights on Darwin-Cairns, together adding more than 2,300 seats into Qantas’s domestic network each week.

Qantas has also recommenced flights between Sydney and Toowoomba with an improved business-friendly schedule offering double daily weekday flights and daily weekend flights.

On the international side, Melbourne’s post-COVID tourism recovery is set to accelerate with Qantas launching a new direct route from Dallas/Fort Worth and significantly increasing flights from Los Angeles.

From December 2, 2022, the national carrier will operate four weekly return flights between Melbourne and major US hub, Dallas-Fort Worth International Airport (DFW), with its Boeing 787 Dreamliners.

These are the first direct flights by any airline between the two cities and follows the success of Qantas’ longstanding Sydney-Dallas/Fort Worth route.

Dallas/Fort Worth is home to Qantas’ partner American Airlines, providing seamless connections between Australia and over 200 cities across the US, Canada, Mexico and South America.

LA FLIGHTS DOUBLING & A380s RETURNING

Qantas is adding another four weekly return flights between Melbourne and Los Angeles with its 787s, up from four currently, to meet strong demand on the route.  The additional flights are operating from this week.

The airline’s refurbished A380s will resume operating some of these flights to LA from December, marking the return of Qantas’ superjumbo and reintroduction of First Class to Melbourne.

The aircraft have a reconfigured Business cabin, with 70 updated suites, an extended Premium Economy section with 60 seats(up from 35) as well as refreshed Economy and First cabins. The upper deck lounge (open to Business and First passengers) has been expanded and upgraded with booth style seating for 10 people, a self-service bar and an option to order signature drinks and snacks. Thirty Economy seats were removed to make room for more premium seating.

LOUNGE REOPENS

The Qantas Melbourne International Business Lounge has today welcomed its first visitors since the start of pandemic, with customers flying to Delhi this morning the first to reacquaint themselves with the lounge.

The Melbourne First Lounge, which operated as a hybrid First/Business Lounge during the pandemic, has reverted to the full premium offering.

QANTAS launches flights to the Heart of Australia, joins the NFT craze

QANTAS Airways will today launch flights to the heart of Australia to bring Australian and international visitors to the red center and the world-famous Uluṟu-Kata Tjuṯa National Park.

Qantas will operate four flights a week on a Boeing 737-800 aircraft between Sydney and Uluru on a Monday, Wednesday, Friday and Sunday to support the iconic tourism destination’s post-pandemic recovery.

These new Qantas flights will be in addition to existing Jetstar flights from Sydney, Melbourne and Brisbane to Uluṟu taking the total Qantas Group flights to 18 weekly return flights in time for the upcoming peak tourist season.

Uluru features in the opening scene of Qantas’ latest reinvention of its iconic ‘Still Call Australia Home campaign, which launched on Friday.

With the inclusion of Uluṟu, the Qantas Group has launched 52 new domestic routes, including since the start of the global pandemic, as Australians seek out new holiday adventures both at home and overseas.

In other news, QANTAS will join the NFT market:

Qantas NFTs

 

A new way to own a piece of Qantas history is on its way.

We’re looking to the future for our next collection of memorabilia. A new set of digital art collectables is gearing up for release as non-fungible tokens (NFTs).

Using blockchain technology, each piece of digital artwork will be one-of-a-kind allowing you to buy, own, collect and sell your unique tokens.

In a world-first, the initial buyer of a Qantas NFT will be able to earn Qantas Points^, with more exciting future benefits for Qantas NFT holders underway.

Stay tuned for more details in the lead up to a mid-year release. Qantas NFTs will be released with net zero emissions, using low-carbon platforms and carbon offsetting.

QANTAS and Jetstar add New Zealand flights

QANTAS Airways and Jetstar Airways are gearing up to reunite families and friends and take tourists across the Tasman following confirmation that New Zealand will reopen for quarantine free travel to all Australian travelers next month, just in time for the Easter holidays.

From April 13, Qantas and Jetstar will operate up to 30 return flights per week across the Tasman on five routes, up from the two return flights a week currently being operated. Prior to COVID, Qantas and Jetstar operated more than 170 return services a week between Australia and New Zealand.

Qantas will fly daily from Brisbane, Melbourne and Sydney to Auckland and Sydney to Christchurch with a mix of its Boeing 737s and wide-body Airbus A330 aircraft

Jetstar will operate three weekly flights from the Gold Coast to Auckland using its Airbus A320 aircraft.

Qantas and Jetstar will further increase flights during May and June and resume flights from Australia to Queenstown and Wellington.

Connections are available on Jetstar’s New Zealand domestic network of more than 60 return flights per week to five destinations. Trans-Tasman flights also connect seamlessly with Qantas’ Australian domestic flight routes and its extensive international network.

Eligible frequent flyers heading across the Tasman will be able to enjoy pre-flight time in Qantas’ Sydney and Melbourne International First and Business lounges as well as the Brisbane International Lounge.

Qantas continues to offer a Fly Flexible booking policy with unlimited flight date changes available on trans-Tasman flights booked before 30 June for travel until 31 December 2022 (fare difference may apply).

MORE SEATS FOR FREQUENT FLYERS

Throughout May, every Qantas and Jetstar flight will be a Points Plane meaning Frequent Flyers can use Qantas Points to book any seat as a Classic Reward Seat. Seats on these flights can also be purchased with cash.

For the rest of the year Qantas has already increased the availability of seats that can be booked with points on Qantas’ trans-Tasman routes by up to 50 per cent.

Classic Flight Reward seats across the Tasman start from 18,000 points with Qantas and 14,400 with Jetstar plus taxes, fees and carrier charges.

QANTAS Airbus A380 first class takes off again

QANTAS Airways will reinstate its full First Class offering at the end of this month both on the ground and in the air as post-pandemic international travel steadily recovers and the national carrier wakes up more of its A380 superjumbo fleet.

A fourth Qantas A380 has emerged from the Californian desert with Reginald Ansett (VH-OQH) leaving the storage yard this month for the first time since it was parked there in March 2020.

Qantas utilized the down time while the aircraft were in the desert to upgrade the popular A380s increasing the number of premium seats and refurbishing the cabins. The aircraft have a reconfigured business class cabin, with 70 updated business suites, and an extended premium economy section with 60 seats, up from 35, as well as refreshed economy and First cabins.

The upper deck lounge has also had a full upgrade with booth style seating for 10 people, a self-service bar and an option to order signature drinks and snacks.

From March 27, Qantas will reopen its Sydney and Melbourne International Business Lounges as more passengers take to the skies and revert its First Lounges in Australia, which operated as hybrid First/Business Lounges during the pandemic, to the full premium offering.

Eligible First Lounge customers will again enjoy a Neil Perry curated à la carte dining menu, Champagnes and fine Australian wines, as well as a seasonal cocktail selection.

The Spa will also reopen offering bespoke pre-travel treatments such as hot stone massages and mini facials using LaGaia products.

The First cabin on the 485-seat A380 is popular with Frequent Flyers for its comfortable suites with fully lay flat beds, premium Neil Perry multi-course dining experience, award winning Australian wine cellar and Martin Grant designed PJs.

Qantas will also reopen its First Check-in suite at Sydney International for First customers and top tier Frequent Flyers to enjoy a personalized and streamlined check-in.

The Qantas A380 currently operates flights from Sydney to Los Angeles and from June will also operate flights between Sydney and London via Singapore.

QANTAS Group posts a half year loss

QANTAS Group issued this financial statement:

  • Underlying EBITDA loss: $(245) million.
  • Underlying Loss Before Tax: $(1.28) billion.
  • Statutory Loss Before Tax: $(622) million.
  • Positive statutory net free cash flow: $552 million, supported by Mascot land sale and strong Qantas Loyalty and Freight cash contribution.
  • Net debt declined to $5.5 billion; within target range.
  • Total liquidity of $4.3 billion.
  • Flying performance significantly impacted by lockdowns, ramp-up costs.
  • Approximately $(650) million negative impact from Omicron in 2H22.
  • Recovery program on track to deliver >$900 million in annualized cost benefits by end FY22 (ahead of schedule).
  • Recovery and retention plan for employees, including 1,000 share rights for approximately 20,000 employees.

The impact of Delta lockdowns and emergence of the Omicron strain drove the Qantas Group to its fourth consecutive half yearly statutory loss of the pandemic, but with some tailwinds accelerating balance sheet repair.

The Group’s flying operations were severely impacted by widespread domestic lockdowns and continued international restrictions, reducing the Group’s total flying to 18 per cent of pre-COVID levels during the half.

As a result of these severely depressed market conditions and ramp-up costs, the Group recorded an Underlying EBITDA loss of $245 million for the first half of FY22. Underlying EBIT loss was $1.13 billion, reflecting non-cash depreciation and amortisation. Revenue losses since the start of the pandemic grew to more than $22 billion.

However, cash generated from the sale of under-utilized land at Mascot; a rush of flight bookings as the Delta lockdowns ended; international border closures easing in the second quarter; and strong contributions from Qantas Freight and Qantas Loyalty made significant inroads to balance sheet repair. Net debt finished the half at $5.5 billion, putting it within the Group’s target range.

In a sign of the post-Delta recovery, the Group recorded three consecutive months of positive net free cash flow between October and December (excluding the land sale), largely as a result of the recovery in forward bookings.

The quick ramp-up of key international services, plus the addition of new routes across Jetstar and Qantas, was key to seizing early momentum in travel demand as restrictions eased.

Liquidity remained strong with $4.3 billion in cash and undrawn facilities as at 31 December.

Concern regarding the Omicron strain had a dampening impact on travel demand in December that intensified in January and was compounded by the unexpected delay to Western Australia’s border opening. However, forward demand for both international and domestic services has improved during February – helped by Australia’s full reopening to all visa holders and the announcement of a new date for WA’s borders to open. This positive momentum is expected to continue in coming months.

The slow recovery in travel demand exacerbated stranded labour costs associated with the decision to stand up all Australian-based employees in December. This resulted in a temporary surplus of around 17 per cent of the Group’s workforce in quarter three.

GROUP DOMESTIC

Delta-related lockdowns meant that domestic travel demand was heavily subdued for most of the first half, with the Group only flying 42 per cent of its pre-COVID capacity. While there was a positive demand spike in November and December, the traditional summer peak was below expectations due to Omicron-related uncertainty.

Group Domestic operations recorded an Underlying EBITDA loss of $388 million.

With the 15 new routes launched in the six months to December 31, Qantas and Jetstar have now announced 48 new domestic routes in the past 18 months as Australians look for new opportunities to travel.

Careful management of capacity meant that 92 per cent of the Group’s domestic flying in the half was
cash positive.

Almost half of the $840 million in structural recovery benefits delivered so far have been in Qantas Domestic, with a final target of approximately $500 million per annum in savings by the end of FY23 – resulting in a significantly lower cost base compared with pre-COVID that will assist with recovery in a competitive market.

Within the period, the Group announced the Airbus A320neo and A220 families as the preferred aircraft for Project Winton, its domestic fleet renewal program. The decision is still subject to final Board approval and discussions with work groups on the arrangements required to operate the aircraft, with an order anticipated by the end of FY22.

GROUP INTERNATIONAL AND FREIGHT

A record performance by Freight offset cash losses from Qantas International as it emerged from hibernation, with the whole division achieving positive Underlying EBITDA of $89 million. Depreciation and amortization took this to an Underlying EBIT loss of $238 million.

The standout result by Qantas Freight highlights the natural hedge it has provided during the pandemic due to a lack of cargo capacity on passenger aircraft.

While some of this demand will ease beyond FY22 as international passenger flights increase, there has been a permanent shift in e-commerce patterns and freight operations are expected to remain higher than pre-COVID levels. In response, Qantas announced the conversion of two A330 passenger aircraft into freighters to support this market shift as well as taking delivery of its third A321 freighter.

Qantas was able to ramp-up quickly to take advantage of accelerated international border openings in November, with high levels of pent-up demand captured on new services to Delhi and the return of services to London, Los Angeles and Singapore.

Despite these bright spots, international flying remained significantly impacted by the continued closure of Australia’s international border to tourists throughout the half, and the reintroduction of border restrictions by other countries as they managed Omicron.

Qantas International has achieved approximately $325 million in recurring structural cost benefits and is on track to increase this to greater than $400 million by FY23, which will significantly assist in recovery.

Jetstar had limited opportunities to fly internationally due to continued border restrictions across its key markets in South East Asia. Jetstar Japan narrowed its losses as domestic flying in that market started to recover.

QANTAS LOYALTY

Qantas Loyalty remains a strong performer with continued earnings growth in the first half of FY22 delivering a strong cash contribution and an Underlying EBIT of $127 million.

The number of Frequent Flyer members continued to grow (up 150,000 to 13.8 million) as did the number of points earned on the ground. All five major financial services partners have been re-signed as well as key supermarket partner, Woolworths. New and expanded deals were signed with Optus, Accor and bp, creating more opportunities for members to earn and redeem points.

In a continued expansion into financial services, Qantas Business Money will launch in 4Q22, enabling small to medium enterprises to transact in foreign currencies at highly competitive rates and earn points in the process, in a partnership with Airwallex.

A combination of border openings and increase in seats available to Frequent Flyer members by up to 50 per cent saw some record levels of redemption. The program also maintained record levels of member satisfaction in the half.

Qantas Loyalty announced a new Green Frequent Flyer tier, aimed at rewarding members for making eco-friendly decisions on the ground as well as in the air.

SUSTAINABILITY UPDATE

Sustainability is a key priority for the Group as it emerges from the pandemic. Significant work took place in the half on the pathway to reach net zero emissions by 2050. In a first for any Australian airline, Qantas purchased up to 30 million litres of Sustainable Aviation Fuel (SAF) over three years for flights departing Heathrow, London.

In March, the Group will announce more detail on its sustainability strategy, including an emissions reduction target for 2030.

LOOKING AFTER CUSTOMERS

Uncertainty around border restrictions and testing requirements has been a significant challenge for customers as travel resumes. Recent initiatives to help include:

  • Fly Well –continued investment in technology to increase contactless and self-service options at airports; social distancing as lounges have re-opened; enhanced cleaning onboard.
  • COVID help hub  guiding customers through every step of their journey from destination-specific information at the time of booking, to reminders and tailored messages as they get ready to fly.
  • Fly Flexible –unlimited date changes on all Qantas domestic and international fares extended through to April 2022.
  • Extension of flight vouchers –extended credit vouchers to enable travel until 31 December 2023, with Jetstar doing the same for vouchers issued due to COVID-19 disruptions.
  • COVID insurance – offering peace of mind with COVID-specific travel insurance.
  • Vaccine recognition program – over 700,000 customers received Qantas Points, status credits and flight vouchers in recognition of being fully vaccinated against COVID-19.

REWARDING EMPLOYEES

As the Qantas Group recovers from the pandemic, it’s important that employees who help deliver that recovery share in the success.

Our people have faced unprecedented challenge and uncertainty over the past two years, enduring long periods of stand downs as well as wage freezes as the Group battled to remain viable and moved to repair the damage done by COVID.

The Board today confirmed that a Recovery and Retention Plan – which was first flagged in September 2021 – will reward around 20,000 eligible non-executive employees with rights to 1,000 Qantas shares.

At the current share price, the rights for each eligible employee are valued at more than $5,000. As the Group recovers, these rights allow us to reward our employees in line with shareholders.

The rights are subject to conditions including the Group delivering on the key targets of its COVID recovery plan and the employee remaining with the company. If conditions are met, the rights will convert to shares in August 2023. These will be new shares issued by Qantas to employees.

No annual executive bonuses will be paid in FY22 for the third year in a row and in addition to a two year wage freeze. However, managers and senior executives will be eligible for a share rights-based Recovery and Retention bonus in August 2023 based on the same performance and service conditions as non-executive employees. Formal invitations to participate in this plan will be issued in coming months and will be accompanied by relevant ASX disclosures.

CEO COMMENTS

Qantas Group CEO Alan Joyce said: “Most of Australia was in lockdown for several months of the first half, so the loss we’ve announced today isn’t surprising but it is frustrating.

“We saw a sharp rebound in travel demand when borders started opening in November and December, only to be hit by the Omicron wave and all the uncertainty that came with it.

“The uncertainty carried over into January but demand has started to recover as Australia adjusts to truly living with COVID. Our frequent flyer surveys show the intent to travel is extremely high and we’re seeing good leisure demand into the fourth quarter. We’ve also seen a sharp uptick in international ticket sales in the past few weeks.

“Predictions in a pandemic are naturally fraught, so we always forecast according to the best information we have but with the agility to adjust as needed. The fact we have all our Australian-based employees back at work means it makes sense for us to fly where it’s cash positive to do so.

“Despite all the uncertainty, we finished the first half with net debt back inside our target range and with strong liquidity, meaning we can start to look further ahead at strategic decisions on fleet, network and growth opportunities.

“We’re on track to deliver more than $900 million in annualised savings through restructuring by the end of FY22, which is ahead of schedule and means we’re able to recover faster and perform better than a pre-COVID Qantas Group could have.

“The challenge of COVID hasn’t obscured the challenge of sustainability and emissions. Since January, we’ve been adding sustainable aviation fuel into our flights from London and we’re on the cusp of doing the same out of the US. We’ll have a significant update on our plans for emissions reduction next month.

“We’re very conscious of the support and patience shown by customers and shareholders as we all wait for travel conditions to stabilise. In the meantime, we’ve done a lot of work to put this company in the best possible position to deliver.

“Employees across the Qantas Group have lived through enormous challenge and uncertainty over the past two years. Many have been stood down for extended periods of time and we’ve asked them to accept a wage freeze to help our company get through an unprecedented crisis that many other airlines didn’t survive.

“I’m pleased that we’re able to offer our people a direct stake in the national carrier through a reward and retention program. It means those who help us through the recovery can share in the success, just as they have in the past.”

OUTLOOK

While travel demand is strengthening and there have been positive developments on international borders in recent weeks, Omicron is likely to negatively impact Group EBIT by an estimated $650 million in 2H22.

Key assumptions for FY22 are:

  • Group Domestic capacity expected to be 68 per cent of pre-COVID levels in 3Q22, increasing to 90-100 per cent in 4Q22.
  • Group International capacity expected to be 22 per cent of pre-COVID levels in 3Q22, increasing to 44 per cent in 4Q22.
  • Net capital expenditure (excluding land proceeds) in FY22 is expected to be $850 million.
  • Underlying depreciation and amortisation in FY22 is expected to be $1.8 billion.
  • Recovery and restructuring program expected to achieve greater than $900 million in annualised benefits by FY22.
  • Net debt expected to be within target range by end of FY22.
  • Leisure travel will continue to lead domestic recovery, with good demand expected into 4Q22.
  • Corporate travel demand outlook remains unchanged. Recovery delayed due to Omicron and now expected to commence with return to office activities in key states from March 2022.