Qantas doubles annual profit to $263 million

SYDNEY — Qantas Airways Ltd. said Wednesday it more than doubled annual profit to 250 million Australian dollars ($263 million) but warned the business environment is too challenging to forecast earnings for the coming year.

The Australian flagship carrier’s result for the 12 months through June compares with AU$112 million net profit in the previous year. Qantas shares closed down 1.3 percent at AU$1.52 in Sydney.

The airline said it was not possible to provide a profit forecast for the year ahead because of uncertain economic conditions and the major changes taking place in the company.

Qantas chief executive Alan Joyce said the result was achieved despite a number of challenges facing the company and industry.

“This result reflects the strength of the Qantas Group’s portfolio and is our best performance since the global financial crisis,” he said in a statement.

“We achieved the result while overcoming significant external and operational factors, including a series of natural disasters, a 28 percent increase in average fuel prices and an underperforming international business,” he said.

Qantas announced last week plans to cut up to 1,000 jobs as part of a major shake-up of its loss-making international business that will include the launch of a new Asia-based airline.

It will also launch a budget airline in Japan to be called Jetstar Japan in partnership with Japan Airlines Co. and Mitsubishi Corp.

Qantas International on Wednesday reported a loss of more than AU$200 million.

“We will continue to focus on improving the customer experience, develop a stronger and broader alliance network and increase our focus on the world’s fastest growing aviation region,” Joyce told reporters, referring to Asia.

Qantas said underlying profit before tax — the airline’s preferred measure of financial performance — was AU$552 million, above the AU$377 achieved in the previous year.

Analysts had forecast underlying profit before tax of AU$514 million, while company guidance was for a figure between AU$500 million to AU$550 million.

Qantas said it had achieved its result despite a AU$224 million impact from natural disasters, including Australian cyclones, Japanese and New Zealand earthquakes and a tsunami and the Chilean volcanic ash cloud that grounded aircraft for days.

Qantas also expects to increase capacity in the first half of the current fiscal year by 8 percent.

Underlying fuel costs for the first half for the current fiscal year are estimated to increase by about AU$500 million to AU$2.2 billion.