Qantas shares soar, airliner expects return to pre-Covid capacity in FY26
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More news: Shares in Qantas lifted in morning trade on a strong growth outlook for the company in FY26, with CEO Vanessa Hudson telling analysts the airliner is expected to return to pre-Covid capacity.
At 11:17am AEST, shares in Qantas had lifted 11.7% to $12.40.
In a call with investors and analysts, CEO Vanessa Hudson said FY26 "will see Qantas domestic and Qantas international return to 100% of pre-Covid capacity" and noted that growth momentum seen in July and August is consistent with this expected outlook.
The group is expecting to receive 20 new aircraft in FY26, followed by 29 in FY27.
In a research note, RBC Capital Markets analyst Owen Birrell said the "FY26 outlook remains constructive", with domestic and international guidance "broadly in line with prior guidance".
Hudson flagged on the call that a significant portion of “Qantas domestic [revenue per available seat kilometre] growth comes from regional and resource markets” in addition to ongoing “strength in the business purpose travel”.
CEO of Jetstar Group Stephanie Tully told analysts the airline group is targeting demand that was previously served by Rex, which entered administration in 2024, and it was still “back filling” demand previously serviced by Tigerair Australia, which exited in 2020.
Meanwhile, CEO of Qantas International Cam Wallace highlighted that Qantas International is seeing the biggest portion of demand growth from the UK/Europe market, which in part “benefits from its non-stop point to point services, which remain very compelling and book well”.
Wallace also flagged "disproportionately strong demand in premium cabins”, which he said was “not just business class, that’s premium economy and first class where we have it”. Other sources of demand come from “a shorter booking window emerging across the industry, and also we’re seeing some pleasing demand out of point of sale USA”.
Qantas profit soars 28% to $1.6b as travel demand surges
The news: Qantas has announced a 28.3% increase in full-year statutory profit after tax amid strong demand across all market segments and growth in passenger numbers.
The numbers: The airline reported a statutory net profit of $1.61 billion, topping market estimates of $1.59 billion, according to Visible Alpha data.
Qantas and Jetstar collectively saw passenger growth of about four million through the year, totalling around 56 million. Domestically, Jestar carried a record 16 million passengers.
Revenue rose 8.6% year on year to $23.82 billion, missing average forecasts of $23.91 billion. Underlying earnings before interst and tax increased by 13% to $2.64 billion and group net capital expenditure grew by 22% to $3.9 billion.
Underlying earnings before interest and tax for the group domestic segment grew 12% year on year while group international and freight grew 20% year on year. Growth in Qantas Loyalty active members helped the segment post 9% growth in underlying earnings before interest and tax.
Qantas will pay a fully franked final dividend of 16.5 cents per share and deliver a fully franked special dividend of 9.9 cents per share. This puts the total dividend at 52.8 cents per share, topping the expected payout of 45 cents per share, after not paying dividends last year.
The company also announced that 25,000 non-executive employees would receive $1,000 worth of shares under a new share plan.
For the first half of FY26, Qantas is expecting domestic revenue to increase by between 3% and 5%, group international revenue to increase by between 2% and 3%. Qantas Loyalty meanwhile is expected to post underlying EBIT growth of between 10% and 12% in FY26.
The context: Over the year, the airline operator secured 17 new aircraft. Qantas also announced it has placed orders for 20 additional A321XLR aircraft, of which 16 will be fitted with lie-flat business class seats.
