The airline’s chief executive, Vanessa Hudson, faces her most significant test since taking the top job from Alan Joyce as she leads discussions with shareholders and brokers.
Already a subscriber?Some of Qantas’ biggest investors are pushing the airline to explain exactly how it will keep returns flowing while spending more than $3 billion on new planes, in the first major test for new chief executive Vanessa Hudson.
Separately, sources said Pendal also believed Qantas had created confusion in the market by announcing a share buy-back, then deciding to defer it until changes to the loyalty program were announced.. But Qantas’ chief financial officer Rob Marcolina has since pulled out of presentations scheduled for New York, with sources indicating the move was partly to give management more time to consider how it would meet its earnings forecasts.
But operating margins fell for both the domestic and international businesses in the first six months of the financial year. Ms Hudson, in a call with investors at the time, was asked to reconfirm the airline’s margin targets for this financial year and the next. She said she was committed to those “in terms of the long-term margin targets”, although Qantas has not specifically said whether it will meet the forecasts for 2023-24.
While the company may have difficulties reaching its targets, the revamp of the frequent flyer program could offer a margin opportunity. That would happen, brokers who spoke on the condition of anonymity said, if the company’s Qantas Loyalty division passed on some of its margin to the flying businesses. It currently buys seats from the airline at-cost.
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