Karryon Qantas Boeing 737

HEALTHY GROWTH: Qantas is on track to offset higher fuel costs

The Aussie carrier’s revenue between 1 January and 31 March 2019 grew by 2.3% to $4.4 billion and Group Unit Revenue was up by 4%.

This came despite a shift in the timing of Easter (which began in the third quarter of FY18 but moved wholly into the fourth quarter of FY19), meaning much of the revenue moved into the fourth quarter.

International Unit Revenue increased by 6.2% with network changes and competitor capacity reductions on long haul routes driving this growth.

“Internationally, the outlook is positive and continues to improve. The long-term fleet and network changes we’ve made are delivering revenue growth, and total market capacity in the fourth quarter is contracting in response to higher fuel prices.”

Qantas Group CEO Alan Joyce

Joyce said domestically the demand was mixed. The resources sector continues to grow and they’re capitalising on that with a lot of extra flying in Western Australia and Queensland.

They are seeing “increased softness” in parts of the domestic corporate market for May and June. Joyce said this may be temporary though as the Federal Election “always has a dampening impact on travel demand”.

Meanwhile, Qantas has reached an agreement with Melbourne Airport for the sale of the airline’s domestic terminal for $355 million, including a 10-year access agreement for Terminal 1.

Qantas retains exclusive access to Terminal 1, including lounges, for domestic services. Options to operate some international flights from Terminal 1 outside of peak domestic times will be assessed.

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