Qantas dismissed reports that it is the subject of a takeover bid as it announced a doubling of annual profits today.
The airline’s net income to the end of June was AU$250 million (£159m) compared to AU$112m the year before.
Qantas chief executive Alan Joyce said reports of takeover talks were “pure speculation” and said the company had not received any formal approaches.
He said the growth in profit was achieved “despite a number of challenges facing the Qantas Group and the global aviation industryâ€.
“We achieved the result while overcoming significant external and operational factors, including a series of natural disasters, a 28% increase in average fuel prices and an underperforming international business,” he said.
He said the profit result was helped by the airline’s domestic operations but its international business had performed less strongly.
He added: “It is important to put the result in context. The group’s planned capital expenditure over the next two years exceeds $5 billion. Fuel prices are expected to remain high and there is considerable uncertainty in the global economy.
“Qantas International reported a loss of over $200 million in FY11 on invested capital of over $5 billion, an unacceptable return. Continuing down this path would be unsustainable.
“Last week we announced a five-year plan to turn the international business around. We will reduce investment in underperforming business areas and direct capital towards growth opportunities.
He said the future focus would be on growth in Asia.
“Our intention is that in five years time Qantas Airlines – domestic and international combined – will exceed its cost of capital on a sustainable basis.â€
by Bev Fearis
