After reporting its biggest-ever annual loss for the 12 months ending in June 2014 – A$2.8 billion – Qantas has sprung back, reporting an underlying profit of A$367 million (US$289 million) for the six months ending December 2014.
Qantas freight delivered its best half-year earnings before interest and taxes (EBIT) since 2006-2007, with improved international markets driving the strong performance to the tune of US$34.3 million EBIT. The Qantas Freight division reported underlying EBIT of US$42.1 million, an improvement of US$33.5 million on the prior corresponding period.
Strong loads on the China-U.S. and U.S.-Australia cargo routes helped offset soft domestic freight performance, Qantas reported.
Earnings before taxes and interest for the international division were US$46 million, the first time it has posted a profit since before the global economic recession.
Cost-cutting and the hard reality of some 5,000 layoffs are part of the reason for the about-face. A wage freeze has been in place since December 2013 – since July 2012 for executives. Chief executive Alan Joyce said Qantas “was meeting or exceeding all our targets as we build a sustainable future.”
Qantas’ stock rose 6 percent following the news. The results bested the airlines’ own prediction of a profit of A$300 million to A$350 million, forecast in December.