Qantas Half Year Announcements: Feb 27, 2014

SA7700 · Wed Feb 26, 2014 12:22 pm

In order to prepare for QF's half-year results and announcements to be released on February 27, 2014 this thread will serve as a focus point and consolidation point for all official Qantas statements-and news on this date. Up until now there has been speculation in the media and importantly also in the Airliners.net Australian Aviation threads, which can be accessed here:

Australian Aviation Thread Part 88 (by allrite Feb 10 2014 in Civil Aviation)

Australian Aviation Thread Part 89 (by EK413 Feb 18 2014 in Civil Aviation)

Australian Aviation Thread Part 90 (by allrite Feb 24 2014 in Civil Aviation)

* Government assistance for Qantas and possible repeal of the QSA (Qantas Sales Act)
* Future of QF flights to-and from JNB
* Future of QF flights to-and from LHR
* Future of QF CEO, Chairman and Board
* Future of QF Frequent Flyer program
* Other Qantas announcements, route changes-or adjustments

Please lets stay on topic as far as possible and focus on QF's official announcements (February 27, 2014).

Thanks and regards,

SA7700

ben175 · Wed Feb 26, 2014 1:13 pm

Praying for some positive route re-structuring to come out of this, not just more cuts.

It's going to be a long sleep!

Flyingsottsman · Wed Feb 26, 2014 1:42 pm

I hope someone in the media ask Joyce the question how can an airline that is nealry broke and now pleading with the Abbott Government for money, be able to pour millions of $$$ into Jetstar Asia, Jetstar Pacific, Jetstar Japan and Jetstar Hong Kong which is not even flying? And also what was he thinking when he came up with this Red Q 2 years ago? I think those questions need to be asked. Because that must have drained millions out of the QF coffers.

Quoting SA7700 (Thread starter):
Future of QF flights to-and from LHR

If they cut one of those flights it will be the MEL DXB LHR

Quoting SA7700 (Thread starter):
Future of QF flights to-and from JNB

Not sure if this flight will go, I think maybe Jarkarta or Manila will go first.

Quoting SA7700 (Thread starter):
Future of QF CEO, Chairman and Board

This time Alan Joyce has to go and Lee Clifford has to walk with him together they have had a vision that some how they even lost sight of and seem to be just making it up as they go, some very bad decissions have been made to put QF in this position.

Quoting SA7700 (Thread starter):
Other Qantas announcements, route changes-or adjustments

Maybe Jakarta and Manila will be given over to Jetstar, if the 767s get retired even quicker then Honolulu to will be given over to JQ.

JQflightie · Wed Feb 26, 2014 7:14 pm

It has started already, 0441 AEST and I get a interesting message from a friend. Good luck to all my colleagues today!

koruman · Wed Feb 26, 2014 8:26 pm

Before people lose their jobs or tax-payers provide a debt guarantee I would like an answer to a simple question.

Was Alan Joyce's remuneration tied to a market share KPI?

If it was, we could be looking at the most expensive bonus in Australian corporate history.

That, combined with Leigh Clifford's prior US$15.34 million Defined Benefit would say much about the culture of entitlement at the top of Qantas.

VH-BZF · Wed Feb 26, 2014 8:28 pm

Quoting Flyingsottsman (Reply 2):

Perhaps we shouldn't jump to conclusions until the announcements are made today. From what I have been told, QF's investment in the Jetstar business is less than the price of 1 A380. I guess you need to read their annual report, because from what I understand if AJ and the board lie or give the market incorrect information, they would face significant penalties or gaol!

The Sydney morning herald had an article stating that had QF been sold into the private equity then the tough decisions being made now would have been made 4 years ago.

Thinking of all the QF staff today.

BZF

JQflightie · Wed Feb 26, 2014 8:33 pm

Quoting VH-BZF (Reply 5):

Thank you.... I'm sitting eating breakfast, up-line, watching SkyNews :-/
Just waiting for 0900 to come....

wzafar · Wed Feb 26, 2014 8:35 pm

Quoting JQflightie (Reply 3):

Please elaborate!

JQflightie · Wed Feb 26, 2014 8:41 pm

Quoting wzafar (Reply 7):

I can't comment right now. I'm bound by a policy in which I can't. You will have to wait.

aerohottie · Wed Feb 26, 2014 9:11 pm

In contrast to what is likely to be announced by Qantas today... here is Air NZ's interim result released this morning.
http://media.nzherald.co.nz/webconte...0149/AirNZinvestorPresentation.pdf

RyanairGuru · Wed Feb 26, 2014 9:29 pm

Quoting JQflightie (Reply 6):
0900 to come

AEDT?

And where will we be able to access it?

wzafar · Wed Feb 26, 2014 9:32 pm

Quoting JQflightie (Reply 6):

Fair enough.

I thought the press conference/announcement/event was at 10.30am? I'm in MEL..

JQflightie · Wed Feb 26, 2014 9:37 pm

Employees find out first thru internal sources, and that should be aprox 0900

Bluebird191 · Wed Feb 26, 2014 9:39 pm

Quoting RyanairGuru (Reply 10):
AEDT?

And where will we be able to access it?

Definitely daylight saving time. If have access to Twitter, the Australian Business Traveller will be live tweeting from the venue. Not sure where else apart from here that you can follow it all.

There is a video that AJ is releasing to staff at 9.30 AEDT, then the the announcement starts at 10.30 AEDT.

Good news for me with having the day off work to follow all the developments, maybe not so for a friend I have (who I was dating almost a year ago) who works for QF who has this week off work due to travelling. Am already feeling for him and his workmates - they're some of the nicest people you'll meet.

RyanairGuru · Wed Feb 26, 2014 10:10 pm

Just out, confirmation that QF has entered into a "commercial arrangement" with BAC over the BNE terminal.

http://www.qantasnewsroom.com.au/med...airport-reach-commercial-agreement

NZ107 · Wed Feb 26, 2014 10:15 pm

http://www.ausbt.com.au/qantas-to-se...ort-terminal-lease-for-112-million

The sale of the lease agreement somehow nets $112m for QF.

qfvhoqa · Wed Feb 26, 2014 10:25 pm

Quoting NZ107 (Reply 15):

http://www.ausbt.com.au/qantas-to-se...ort-terminal-lease-for-112-million

The sale of the lease agreement somehow nets $112m for QF.

I wonder why Brisbane Airport Corporation was willing to pay so much for the remaining 4 years of the lease? They must believe they can jack up the lease rates to QF over this time. I would think QF will use this money for redundancies.

texan · Wed Feb 26, 2014 10:32 pm

5,000 jobs lost and $252 million loss.

Texan

edit: according to SMH website

[Edited 2014-02-26 14:33:57]

tayser · Wed Feb 26, 2014 10:35 pm

The Age live blog as all the details come out: http://www.theage.com.au/business/av...ounce-job-cuts-20140227-33j48.html

RyanairGuru · Wed Feb 26, 2014 10:35 pm

$252mn is actually on the bottom end of their guidance, so a "good" result, although there is no full year guidance.

Qantas International has sharply deteriorated, reversing any signs of improvement in that division.

RyanairGuru · Wed Feb 26, 2014 10:36 pm

Do we have any guidance which divisions the 5,000 jobs are going to come from?

allrite · Wed Feb 26, 2014 10:43 pm

Qantas fleet information at ASX

Can't copy and paste so will type.

RyanairGuru · Wed Feb 26, 2014 10:43 pm

10:30 press conference will be broadcast live on ABC24 (and presumably Sky as well)

NZ107 · Wed Feb 26, 2014 10:43 pm

Quoting RyanairGuru (Reply 20):

1.5k in management and support positions, the rest from operational redundancies

TruemanQLD · Wed Feb 26, 2014 10:46 pm

A380's have been deferred and final 3 of JQ 787's also deferred.

allrite · Wed Feb 26, 2014 10:47 pm

* Growth suspended for Jetstar Asia
* Increased domestic usage of A330 E-W and one SYD-BNE-MEL triangle
* A332 freed up for QF international
* 6 non-reconfig 747s to be retired ahead of schedule, 9 reconfigs will remain
* All 767s retired by Q3 FY2015
* 8 remaining A380 orders deferred
* Final 3 of Jetstar's 14 787-8's deferred
* Jetstar's A320 book restructured

More to come...

TruemanQLD · Wed Feb 26, 2014 10:48 pm

PER-SIN is gone. WA is gonna be real happy about this

docpepz · Wed Feb 26, 2014 10:50 pm

The only route cut seems to be PERSIN. All Australia-SIN services to be operated by A330s. MEL LHR retimed for less ground time in LHR

allrite · Wed Feb 26, 2014 10:50 pm

* QF to quit PER-SIN route
* BNE-SIN, SYD-SIN to go A330 Q1 FY2015
* MEL-LHR A380 service retimed to free up A380 for new flights

RyanairGuru · Wed Feb 26, 2014 10:50 pm

*PER-SIN is to be cut
*BNE-SIN and SYD-SIN to swap to A330
*MEL-LHR to be retimed

na · Wed Feb 26, 2014 10:51 pm

Quoting allrite (Reply 21):

The last 734s were retired this month, all 767s will be retired by October 2015, the remaining 744s of the first batch (built before 1992) will be retired by mid-2016, all 744ERs and the 3 newest 744s remaining. Outstanding A380s and 787s will be deferred (I thought the A380s were already deferred some time ago until around 2020 so I dont see that as news really).

TruemanQLD · Wed Feb 26, 2014 10:51 pm

I didn't see PER-SIN get speculated about at all, must really be a bad route for them, given they only just left PER-HKG so would have thought this would have 'condensed' the market. There is a lot of competition from LCC and SQ on this route, however is sad to see them completely leave the PER international market. However, that is the only cut. Everyone was expecting SYD/BNE-SIN to be reduced to A330 operations and nice to see MEL-LHR retimed, hopefully provide more options.

RyanairGuru · Wed Feb 26, 2014 10:52 pm

Quoting allrite (Reply 28):
retimed to free up A380 for new flights

I'm not sure how this works from an operational perspective, but either way it will be interesting to see what they do with them.

PW100 · Wed Feb 26, 2014 10:53 pm

* MEL-LHR retimed, to reduce A380 ground time in LHR;
* No changes on LHR capacity.

allrite · Wed Feb 26, 2014 10:56 pm

Employee cuts to the equivalent of 5000 full time positions (which, technically speaking, is not necessarily 5000 jobs). Includes management/non-op roles by 1,500, restructure of line maintenance, Avalon closure and closure of Adelaide catering, both previously announced. Wage frees for executives, Joyce's take home pay reduced by 36% this FY.

BNE terminal lease only non-aircraft asset finalised.

allrite · Wed Feb 26, 2014 10:57 pm

From the ASX, and in PDF:

* Financial Results
* Appendix

anstar · Wed Feb 26, 2014 10:58 pm

Quoting texan (Reply 17):
5,000 jobs lost and $252 million loss.

Texan

And any debt to be under wrotten by the Aussie govt?

Quoting allrite (Reply 25):
* Final 3 of Jetstar's 14 787-8's deferred

So that doesnt bode well for QF excersing their 787 options... gone are the days of the 60 confirmed + options order!

TruemanQLD · Wed Feb 26, 2014 11:00 pm

Quoting anstar (Reply 36):
gone are the days of the 60 confirmed + options order!

Was just thinking about that! Amazing that at one point they had the most 787 aircraft on order in the world... and now...

Given QF is leaving PER-SIN... could we see EK do a DXB-SIN-PER service? They seem to do very well off BNE-SIN-DXB with lots of SIN-bound passengers.

qfvhoqa · Wed Feb 26, 2014 11:00 pm

JQ ended with a $16million loss
QFi back to massive $262million loss
QFd profit shrinks to %57million

tortugamon · Wed Feb 26, 2014 11:02 pm

Quoting anstar (Reply 36):
So that doesnt bode well for QF excersing their 787 options... gone are the days of the 60 confirmed + options order!

I am sure that would be a sigh of relief for Boeing. I hear that they were priced very aggressively.

5k employees is tough to read about. Hope there is a turnaround here.

tortugamon

TruemanQLD · Wed Feb 26, 2014 11:03 pm

Quoting qfvhoqa (Reply 38):

JQ ended with a $16million loss

Any indication as to why? This would surely be mainly HKG and JAP I would think, or have we seen a deterioration in JQaustralia as well?

Quoting qfvhoqa (Reply 38):
QFi back to massive $262million loss

The measures they have announced aren't going to solve this... Would think more to come on this, probably with certain known partner carriers...

RyanairGuru · Wed Feb 26, 2014 11:06 pm

Quoting TruemanQLD (Reply 40):
The measures they have announced aren't going to solve this

Well they are taking a HUGE amount of capacity out of SIN, which is definitely one of the black spots right now.

But I agree that there is going to be further rationalisation in the International network.

allrite · Wed Feb 26, 2014 11:08 pm

Quoting TruemanQLD (Reply 40):
Any indication as to why? This would surely be mainly HKG and JAP I would think, or have we seen a deterioration in JQaustralia as well?

Market overcapacity in Asia (up 34%) and Australia driving yields down, unfavourable fuel costs and foreign exchange, according to QF's filings.

aryonoco · Wed Feb 26, 2014 11:11 pm

Well, this is turning out to be better than expected actually.

The loss is on the lower side, though I'm surprised to see QFi still so deep in red.

And if PER-SIN is the only route to be cut, well that's also great. Everyone was expecting much worse.

5,000 jobs... I'm sure a tough pill to swallow for those who have lost their jobs, I hope they can find something different in no time at all. But you do have to wonder, why was there so much slack? Surely 5,000 people didn't work on PER-SIN!

TN486 · Wed Feb 26, 2014 11:13 pm

Quoting allrite (Reply 21):
Qantas fleet information at ASX

"the review has identified a number of high quality assets of significant value". Yes. So....................
You could start a new thread on this statement alone. Its going to be a long, long, 2 years I suspect (F/Y 15 and 16).

allrite · Wed Feb 26, 2014 11:14 pm

Quoting aryonoco (Reply 43):
, I hope they can find something different in no time at all. But you do have to wonder, why was there so much slack? Surely 5,000 people didn't work on PER-SIN!

The figure includes staff from the closure of maintenance and catering operations. Hopefully some of the people charged with keeping an eye on this site (and others) are not impacted.

LAXdude1023 · Wed Feb 26, 2014 11:16 pm

From a route perspective, what will it take to stop the bleeding? Certainly a great deal of their network must be unprofitable.

IrishAyes · Wed Feb 26, 2014 11:22 pm

Quoting LAXdude1023 (Reply 46):

From a route perspective, what will it take to stop the bleeding? Certainly a great deal of their network must be unprofitable.

Agreed. I'm shocked that they didn't announce end of PER-JNB.

allrite · Wed Feb 26, 2014 11:23 pm

Quoting irishayes (Reply 47):
Agreed. I'm shocked that they didn't announce end of PER-JNB.

Qantas don't fly that route - that's a SAA codeshare, which has been announced to be ending. They do fly SYD-JNB.

Zkpilot · Wed Feb 26, 2014 11:24 pm

At what point does enough become enough and the CEO, upper management and the board get sacked?
During their tenure QF has pretty much not made a profit, it's share price has dropped massively and its competitors have all grown. On the very same day NZ has announced a large jump in profit.

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