Australia’s national carrier is setting a course to “recovery mode” after a traumatic year during which it slashed thousands of jobs in the wake of the coronavirus pandemic.
Qantas will begin repairing its balance sheet in the second half of fiscal 2021, as domestic borders reopen, costs continue to fall and freight and passenger traffic increases.
If all goes as planned, and there are no more material border closures, the airline believes it could be close to breaking even on an underlying earnings basis after last year’s loss.
The forecast also assumes international travel won’t recover until June or July next year.
“We’ve seen a vast improvement in trading conditions over the past month as many more people are finally able to travel domestically again,” CEO Alan Joyce said on Thursday.
“There’s been a rush of bookings as each border restriction lifted, showing that there’s plenty of latent travel demand across both leisure and business sectors.
“We are also seeing people booking several months in advance, which reflects more confidence that we’ve seen for a long time.”
Qantas expects its domestic capacity will be back up to almost 70 per cent of pre-COVID levels in December and be close to 80 per cent by the end of March.
“But overall, the group is still a long way off anything approaching normal,” Mr Joyce cautioned, adding that until a vaccine is available the risk of more coronavirus outbreaks remains.
“We also have a lot of repair work to do on our balance sheet from the extra debt we’ve taken on to get through the past nine months.”
Earlier this week, Qantas announced plans to outsource about 2000 positions.
The jobs affected are at 10 airports around the country and impact ground operations workers including ground crew, aircraft cleaners and baggage handlers.
Job losses across the group as a result of the crisis and associated border closures account for about 8500 of its 29,000-strong pre-COVID workforce.