Qantas comes through the clouds to land on a magic number
After years of turbulence and a radical shake-up, Qantas’ share price has finally hit a telling milestone.
She was right at the time but Leigh Clifford and Alan Joyce have the airline positioned to reap the benefits of a massive restructuring and for a profitable future.
Over the decade, domestic airfares have fallen by 25 per cent and the number of foreign carriers coming into the country has increased many fold, forcing Qantas to make some radical changes.
Some 5,000 jobs have gone leaving the airline with 30,000 people.
Earnings per share next financial year are tipped to increase from 52.9 cents a share to 55.4 cents, which puts the company in shape to set a new record for earnings which peaked (on an underlying basis) at $1.5 billion in the 2016 year.
More impressive has been the consistent financial performance from the company in an industry notorious for its volatility.
The stock (QAN) traded as high as $5.49 this morning before returning back to the $5.45 buyout price offered by a consortium in December 2006 in early afternoon trade.
Some argue if the deal had gone through on the eve of the GFC it would have wreaked havoc on the airline causing a split and even bigger job losses.
But shareholders would have their $5.45 cash safely in their hands.
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After a decade of underperformance and a stunning turnaround over the last three years, Qantas’ stock price has finally hit the $5.45 price that former chair Margaret Jackson said shareholders would be stupid to reject.