Qantas posts $1.9bn loss but revenue jumps 54% as air travel surges after borders reopen

Qantas has posted a full-year underlying pre-tax loss of $1.86bn after border closures and travel uncertainty as the Covid-19 pandemic weighed on earnings.

The airline’s net loss after tax for the year to 30 June narrowed to $860m, compared with $1.7bn the year before.

“These figures are staggering and getting through to the other side has obviously been tough,” Qantas chief executive, Alan Joyce, said.

The results came as engineers fired a shot across the bow of the airline on Thursday morning with a one-minute work stoppage.

The Australian Licensed Aircraft Engineers Association is pushing for a 12% pay rise, which it says would amount to 3% a year over the four years since their existing agreement lapsed in 2019.

Qantas engineers who are ALAEA members started their shifts one minute late.

“Just sit at a table for one minute,” federal secretary, Steve Purvinas, said in a message to members.

“This will not harm passengers or the airlines, it will remind them that from this point, our options can be expanded at any time with three workdays’ notice,” he said.

The protected action happened as Qantas announced its revenue for the year was up 53.5% to $9.11bn.

Purvinas has told the ABC that the pay push equates to just 3% a year, and that engineers had accepted requests for wage freezes or minimum increases previously, and had not had a pay rise since 2019.

Staff morale is “absolutely in the gutter”, he said.

Alan Joyce announced the airline’s full-year results in Sydney. Photograph: Dean Lewins/AAP

Shares in Qantas jumped on the news of the results, up 8% to $4.91 by 10.25am in a firm Australian market.

Qantas said flying levels for the year averaged 33% of pre-pandemic levels after the pandemic significantly disrupted air travel, but finished the financial year at 68%.

“We always knew travel demand would recover strongly but the speed and scale of that recovery has been exceptional,” Joyce said.

Sign up to Guardian Australia’s Morning Mail

Our Australian morning briefing email breaks down the key national and international stories of the day and why they matter

Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy. We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply.

That, along with lower debt levels, enabled the airline to announce an on-market share buyback of up to $400m, although it will still not pay any dividend for the year.

“Our debt is now below our target range – so in addition to the investments we’re making in customers and our people, we’re in a position to start repaying shareholders,” Joyce said.

The airline’s net debt is down to $3.9bn at the end of the 2021/2022 financial year, from a high of $6.4bn.

Qantas said long periods of low activity combined with restart costs resulted in a full-year underlying loss of $1.1bn at its domestic operations, which include low-cost carrier Jetstar.

But sustained recovery in domestic travel demand translated into positive earnings for the fourth quarter, Qantas said.

A Qantas spokesperson also said the stoppages would not affect customers.

“These token one-minute stoppages won’t have any impact on customers or our operations,” they said.

“We’re committed to pay increases for our licensed engineers, but the union’s pay claims are as high as 12% for one year, or three times the wage increases agreed to recently by thousands of other employees across the group.”

Heavy losses in the group’s international passenger business were again offset by a record performance of Qantas Freight, which benefited from high yields amid a shortage of cargo space globally.

Overall, Qantas’ international and freight division posted an underlying loss of $238m.

Qantas Loyalty accelerated its earnings growth to double digits in the second half.

The airline said it is now focusing on responding to current operational challenges.

Key customer measures including contact centre wait times, cancellation rates and mishandled bag rates are trending back towards pre-pandemic standards during August 2022, the company said.