Qantas Fin Analysis
Case Study on Qantas Airways Limited / Qantas Group (‘QIL’)
The principal activities of the Qantas Group are the operation of international and domestic air transportation services, the provision of freight services and the operation of a Frequent Flyer loyalty program.
Key Business Drivers
1. Brand value and dominant share in the domestic market.
2. Product and Service innovation.
3. Consistent high load factor.
4. Strong multi –brand strategy and service offering (i.e. Operating both, the budget brand Jetstar and premium brand Qantas).
5. Price of Aviation Turbine Fuel (ATF)
6. Stable domestic economy.
7. Global strategic tie-up for its International service offerings.
8. Aircrafts with lowest average age.
Financial Analysis (Consolidated – Per Statutory Books)
For the year ended
Unit
30 June 2012
30 June 2011
Total Revenue
$ M
15,724
14,894
Operating Profit (excluding Fuel Cost)
$ M
5,431
5,312
Fuel Cost
$ M
4,220
3,627
Finance Cost (Net)
$ M
176
113
Depreciation & Amortization
$ M
1,384
1,249
PBT
$ M
(349)
323
Tax benefit / (expense)
$ M
105
(74)
PAT
$ M
(244)
249
Cash Accruals (CA)
$ M
1,140
1,498
Tangible Networth
$ M
5,279
5,558
Long Term Debt
$ M
5,430
5,454
CA / Long Term Debt
%
21
27
Leverage
Times
1.24
1.09
Interest Cover
Times
6.88
14.91
Operating performance
1. QIL registered an overall growth in revenues of ~6% in FY 12 as compared to FY 11. The revenue growth was contributed, among others, by the Frequent Flyer Program offering through the acquisition of the company Wishlist in its domestic market.
2. QIL’s revenue from international passenger and freight service declined due to global slowdown. QIL’s high occupancy level (~80%) in the domestic market and stellar growth of Jetstar (38% capacity growth) in Asia has substantially offset this decline in revenue. The Available Seat Kilometres increase by 5% in FY 12 to 139,423 M signifying an increase in QIL’s market
The principal activities of the Qantas Group are the operation of international and domestic air transportation services, the provision of freight services and the operation of a Frequent Flyer loyalty program.
Key Business Drivers
1. Brand value and dominant share in the domestic market.
2. Product and Service innovation.
3. Consistent high load factor.
4. Strong multi –brand strategy and service offering (i.e. Operating both, the budget brand Jetstar and premium brand Qantas).
5. Price of Aviation Turbine Fuel (ATF)
6. Stable domestic economy.
7. Global strategic tie-up for its International service offerings.
8. Aircrafts with lowest average age.
Financial Analysis (Consolidated – Per Statutory Books)
For the year ended
Unit
30 June 2012
30 June 2011
Total Revenue
$ M
15,724
14,894
Operating Profit (excluding Fuel Cost)
$ M
5,431
5,312
Fuel Cost
$ M
4,220
3,627
Finance Cost (Net)
$ M
176
113
Depreciation & Amortization
$ M
1,384
1,249
PBT
$ M
(349)
323
Tax benefit / (expense)
$ M
105
(74)
PAT
$ M
(244)
249
Cash Accruals (CA)
$ M
1,140
1,498
Tangible Networth
$ M
5,279
5,558
Long Term Debt
$ M
5,430
5,454
CA / Long Term Debt
%
21
27
Leverage
Times
1.24
1.09
Interest Cover
Times
6.88
14.91
Operating performance
1. QIL registered an overall growth in revenues of ~6% in FY 12 as compared to FY 11. The revenue growth was contributed, among others, by the Frequent Flyer Program offering through the acquisition of the company Wishlist in its domestic market.
2. QIL’s revenue from international passenger and freight service declined due to global slowdown. QIL’s high occupancy level (~80%) in the domestic market and stellar growth of Jetstar (38% capacity growth) in Asia has substantially offset this decline in revenue. The Available Seat Kilometres increase by 5% in FY 12 to 139,423 M signifying an increase in QIL’s market