Continued strong travel demand across domestic and international has driven further reductions in the Qantas Group's net debt to well below pre-COVID levels.
After peaking at more than $6.4 billion at the height of the pandemic, net debt is expected to fall to around $4.0 billion by 30 June 2022. This is an improvement of around $1.5 billion in the past six months.
The Group has updated its net debt target range - a key part of its financial framework - to be between $4.2 billion and $5.2 billion.
While the Group still forecasts a significant full year Underlying EBIT loss for FY22 that includes the worst of the Delta and Omicron impacts as well as restart costs, the business remains on track for 2H22 Underlying EBITDA of between $450 million to $550 million. The Group is also on track to return to Underlying profit in FY23.
July peak preparations
The Qantas Group sincerely thanks customers for their patience and understanding while the airline works through what has been a challenging restart for the industry globally.
The Group is working with industry partners to improve the travel experience during the upcoming school holiday peak. While a tight labour market and COVID-related impacts persist, there will be a 15 per cent increase in ground handling staff compared with the Easter holidays and airports are increasing their security screening resources.
Since April, Qantas and Jetstar have recruited more than 1,000 operational team members and hundreds of additional contact centre staff have slashed average call wait times. Qantas will have 20 per cent more team members on standby to minimise any impact of sick leave.
Qantas has made schedule adjustments to better spread peak times and will have two widebody aircraft on reserve to assist, if required. The airline is rolling out new check-in and baggage kiosks, starting in Sydney, to speed up customers' journeys.
Recovery boost for employees
Up to 19,000 EBA-covered employees across the Qantas Group will be offered a $5,000 boost as the national carrier shares the benefits of its recovery.
The payment will be made to employees once a new enterprise agreement covering them is finalised. Nine agreements covering some 4,000 employees have been finalised already and will be paid shortly. Consistent with previous discretionary payments, eligibility conditions will apply.
This follows a two-year wage freeze and comes on top of two per cent annual pay increases that are currently being negotiated across the Group.
The cost of the recovery boost to the Group is estimated at around $87 million in FY22.
