‘Obscene’: Qantas facing pressure to return Covid payments amid record-breaking profit forecast

Australia’s national carrier is facing pressure to pay back pandemic assistance after revealing a record-breaking $2.5 billion profit forecast.

Hours after Qantas revealed it expects to make a $2.5 billion profit margin this year, the national carrier is facing calls for it to return Morrison-era pandemic assistance.

On Tuesday, Qantas Group posted a market update to the ASX, crediting “very positive” trading conditions with creating an estimated pre-tax profit of $2.45 to $2.47 billion for the 2023 financial year.

It said an increased demand in travel, the arrival of new aircraft and higher fare and freight prices had given the Group a “strong balance sheet”.

But the Transport Workers Union, which is locked in a court battle with Qantas over the sacking of 1700 ground staff at the height of the pandemic, says the airline should use the forecast profit to pay back $2.7 billion of government assistance.

Michael Kaine, the union’s national secretary, said the forecast was a “kick in the guts” for workers and passengers.

“This obscene profit forecast is the result of Qantas management bleeding dry workers, passengers and the taxpaying public,” he said.

“The right thing to do would be to pay back every dollar of no-strings government handouts Qantas received from Scott Morrison before it trashed every essential section of the airline to prop up executives and shareholders.”

Qantas Group CEO Alan Joyce said trading conditions were ‘very positive’. Picture: NCA NewsWire / Gaye Gerard

Qantas reported that by the first half of the 2022-23 financial year, domestic travel had returned to 104 per cent of pre-Covid levels.

International travel is currently above 80 per cent and is expected to match pre-pandemic rates by March 2024.

Qantas CEO Alan Joyce said trading conditions were “very positive”.

“More parts of the aviation supply chain are returning to normal, which means we’re able to put some of the spare aircraft and crew we kept in reserve back in the schedule,” he said in a statement to the ASX.

“That’s combining with lower fuel prices to put downward pressure on fares, which is good news for customers.”

Mr Joyce said Qantas will be bringing out the last of its stored aircraft and was “on track” to add another eight new aircraft by the end of 2023 to increase its flying capacity.

“The industry remains capacity constrained and the travel category remains strong, so there’s still a mismatch between supply and demand that’s likely to persist for some time, especially for international flying,” he said.

Qantas has forecast it will make a record-breaking pre-tax profit of $2.5bn for the 2023 financial year. Picture: NCA NewsWire / David Geraghty

The Group’s net debt is expected to be between $2700m and $2900m, with it’s on-market buyback of shares increased by up to $100m.

Local recovery has been boosted by an increase in flying between Sydney, Melbourne and Brisbane, dubbed the “Golden Triangle” by Qantas.

However, the Group revealed its international capacity was hampered by operational delays and staff shortages across the industry.

Domestic revenue intakes are currently sitting at 118 per cent of levels since before the Covid pandemic, while international profits are at 123 per cent.

Originally published as ‘Obscene’: Qantas facing pressure to return Covid payments amid record-breaking profit forecast