Qantas FY14/15 F/Y Results [Dreamliner in 2017]

[Comoman]

What is more interesting on the range map is the missing bits. What is the range from PER? My guess is that PER would put Cape Town/JNB, IST/SAW, MUC all firmly within range. Seasonal flight to IST and MUC every year? Competing with SAA/VA to South Africa from PER?

.

ETOPS problems from Perth to JNB/CPT over Indian Ocean. Same problem VA had with their 777's.

 

[Pleb Status]

On the 789, I cannot see why some people are so happy to get 737 comfort on a long range aircraft. QF will go 3-3-3 in Y with 31in seat pitch without any doubt.

There are numerous complaints on AFF about QF/VA using 737 aircraft on flights across Australia (which I agree with). However, everybody gets excited when the exact same level of comfort is introduced for flights up to 14 hours long.

 

[RooFlyer]

...and dividends to shareholders for the first time since 2008/09! Things really must be looking up!

Are you referring to the capital return? Different thing entirely, and an interesting development give Qantas' previous complaints about the cost of access to capital (not a criticism, just observing that things appear to have changed for the better, if they are now returning capital back).

 

[TomVexille]

ETOPS problems from Perth to JNB/CPT over Indian Ocean. Same problem VA had with their 777's.

I wonder if QF will possibly lean on CASA to review ETOPS now that they are getting the 789.

 

[moa999]

ETOPS problems from Perth to JNB/CPT over Indian Ocean. Same problem VA had with their 777's.

Given LA are already flying SCL-AKL-SYD using 787 with ETOPS330 would think QF has a pretty good argument

 

[Brettmcg]

Are you referring to the capital return? Different thing entirely, and an interesting development give Qantas' previous complaints about the cost of access to capital (not a criticism, just observing that things appear to have changed for the better, if they are now returning capital back).

Sorry very clumsy on my part. Saw something about returns to investors of 23c per share and immediately thought dividends! If I understand correctly, that means shareholders don't have to pay tax on that returned portion, correct?

 

[medhead]

QF reads that and thinks ... PER? PER? What and where is this PER thing? We only fly from Sydney in Australia, don't we? (Well, OK from MEL as well, but only because we have to get the planes back to Sydney.)

It is PER after all.
But would be fairly attractive to me for getting to Europe in a short flight and one long hop.

This is the range from SYD:


And by comparison the range from PER:


So, many new routes from Perth would theoretically be possible. Cape Town, Johannesburg (and in fact most of Africa), Istanbul and even Rome seem to be within reach. Germany would be a bit of a stretch but also seems possible - though I suspect any European routes would be via DXB anyway.

Thanks for the maps. Given the Greek and Italian populations of Australia there would have to be a pretty good market to Athens and Rome. Munich is southern Germany, again with a pretty big seasonal visitor profile around September/October. IST would have pretty good demand around April. A permanent departure with varying destinations?
But, yes DXB might be an issue.

ETOPS problems from Perth to JNB/CPT over Indian Ocean. Same problem VA had with their 777's.

There seems to be a bit of a push to get Australia to change that restriction for the 787, since other countries seem to be doing so. But what do they fly between PER and south africa now? 747s?

Anyway, just some random ideas.

 

[Brettmcg]

It is PER after all.

Thanks for the maps. Given the Greek and Italian populations of Australia there would have to be a pretty good market to Athens and Rome. Munich is southern Germany, again with a pretty big seasonal visitor profile around September/October. IST would have pretty good demand around April. A permanent departure with varying destinations?
But, yes DXB might be an issue.

I would assume Greek and Italian destinations would be pretty low-yielding; lots of leisure, but not much business traffic. Also fairly sure that the QF/EK agreement has some kind of stipulation forcing QF to send all Europe-bound flights through DXB. Not a problem in itself, but may mean that any continental European destination on QF metal would originate in PER with connecting traffic from MEL/SYD. Having said that, would have thought BNE would be next in line for QF metal to DXB?

 

[TomVexille]

There seems to be a bit of a push to get Australia to change that restriction for the 787, since other countries seem to be doing so. But what do they fly between PER and south africa now? 747s?

Anyway, just some random ideas.

SA fly an a340

 

[medhead]

Finally looking at the ASX presentation the wording is strange. JQ record result? At $230 million. Compared to the vastly larger numbers and more importantly turn around for QFi and QFd. JQ has contributed about 16% to underlying EBIT. Is the investment in group resources to JQ proportional to that 16% contribution? Is the capital committed equal to 16%?

It also seems to be fairly range limited if $230 million is a record result. I know it doesn't work this way, but might QFi have an EBIT around $700 million next year, if they keep going at the same rate?

Edit: And JQi had a record performance with the introduction of the 787. Imagine the upside to the QFi result if they had benefited from the 787 as originally planned. I'd be pretty disappointed with the JQ result given the advantages being given to them. What about the opportunity cost of forgone performance improvement for QFi? This is lost for another 2 years.

 

[moa999]

Finally looking at the ASX presentation the wording is strange. JQ record result? At $230 million. Compared to the vastly larger numbers and more importantly turn around for QFi and QFd. JQ has contributed about 16% to underlying EBIT. Is the investment in group resources to JQ proportional to that 16% contribution? Is the capital committed equal to 16%?

JQ generally is very capital light - it leases all its planes (so the cost of the lease (equivalent to interest and depreciation) is included in Expenses
whereas for QFd and QFi a decent chunk of the planes are owned on balance sheet (so debt and equity funded) with only depreciation included in the segment numbers.

Would suspect on an EBT basis or ROE basis, JQ looks much better

 

[medhead]

JQ generally is very capital light - it leases all its planes (so the cost of the lease (equivalent to interest and depreciation) is included in Expenses
whereas for QFd and QFi a decent chunk of the planes are owned on balance sheet (so debt and equity funded) with only depreciation included in the segment numbers.

Would suspect on an EBT basis or ROE basis, JQ looks much better

Thanks.
I'm just getting into the capital slides now. They do capitalise leased aircraft at 3100 million. Perhaps this provides an equvialent view for each part of the group? Also raises an interesting question about the 787s which were purchased. But perhaps they are then leased from Qantas to JQ? The lack of breakdown against part of the Qantas group makes it hard.

 

[RooFlyer]

Sorry very clumsy on my part. Saw something about returns to investors of 23c per share and immediately thought dividends! If I understand correctly, that means shareholders don't have to pay tax on that returned portion, correct?

That's the usual situation with capital returns to shareholders, but as ever, everyone's MMV!

EDIT: there's a comment on p24 of the ASX presentation, saying "the form of the distribution will have regard to a number of factors including the level of franking credits available in order to determine the most equitable and tax efficient method for all shareholders."

I think I'll leave that one to the accountants.

 

[bismarck]

Fairly strong results all round. Well done QF.

 

[RooFlyer]

Oh oh. Just did a search on 'enhancement' in the presentation. Comes up a number of times, including p36 "significant customer comfort enhancements".

Red Roo, looks like they are still not getting your memos!

Nice presentation, though.

 

[Red Roo]

Introducing a new flying kangaroo: https://www.youtube.com/watch?v=gw2LBy5K1iM

 

[Princess Fiona]

Really happy about today's results.
Will be sad to see the old 747's go but I guess it's well overdue.

I'm definitely bagging a seat (any seat) on the last 747 flight

 

[ajw373]

But perhaps they are then leased from Qantas to JQ? The lack of breakdown against part of the Qantas group makes it hard.

They kind of are leased from Qantas and other companies, which Qantas may or may not have ownership in.

4 for example are owned by 4 different Japanese companies that all have the same address. Presumably shelf companies. 3 more are owned by an Aussie company that has the same address as Qantas, and the rest are listed as being owned by Qantas. All down to the way these things get financed.

The QJ A320 are similar, though some are leased through 'known' leasing companies.

 

[ogs70]

Introducing a new flying kangaroo:

I think this is the link you want https://www.youtube.com/watch?v=gw2LBy5K1iM Looks great.

 

[moa999]

Introducing a new flying kangaroo: https://www.youtube.com/edit?o=U&video_id=gw2LBy5K1iM

This link might work better:
https://www.youtube.com/watch?v=gw2LBy5K1iM