Qantas says international flying will be twice as lucrative in post-Covid era

Qantas said international flying will be at least twice as lucrative in the post-Covid era, thanks to new income from marathon direct flights that crisscross the world and deep cost cuts during the pandemic. In its first investor day in four years, the Australian airline on Tuesday laid out the projected boost from a vast fleet overhaul and a three-year turnaround plan implemented shortly after Covid grounded travel in 2020. The forecast for bumper profit margins suggests there will be no immediate end to soaring fares on overseas flights that are supercharging airline revenues. The optimistic outlook reflects an aviation industry that was forced to become more efficient to weather the Covid crisis, a worldwide reset that is now enriching investors. Qantas said it also expects fatter margins in its domestic business, the airline’s earnings engine, due to rising demand and the introduction of more efficient jets. Operating profit at the loyalty unit could double by 2030 as it expands into holidays and hotels, the carrier said. “This is a structurally different business than it was before Covid, operating in markets that have also changed,” Qantas CEO Alan Joyce said in a statement accompanying a 97-page investor presentation. Operating profit margins at Qantas International will grow from about 5% before the pandemic to more than 8% next year, and to between 10% and 12% in following years, the airline said. Margins at the domestic business will be 18% next year and beyond, up from 13% before Covid, Qantas said.<br/>