Qantas Airways Limited (ASX: QAN) recently announced that its third-quarter update will be postponed. The company was initially scheduled to present its performance for the quarter at the end of April, however, the update has been moved out by a couple of weeks.
Why has Qantas postponed its quarterly update?
Qantas has moved its third-quarter trading update to a later date due to the catastrophic impact of the coronavirus pandemic. Travel restrictions and social distancing measures introduced to curb the pandemic have basically crushed travel and stripped airlines of revenue.
Since February, Qantas has stopped international travel, reduced its domestic volume by nearly 90% and also released more than 20,000 staff in response to the pandemic. As a result, with the majority of passenger services grounded, Qantas will be looking to provide more emphasis on future outlooks.
There is no set date as of yet, with Qantas noting on its website that the date for its third-quarter trading update is to be confirmed.
What should you expect from the update?
In its update for the quarter, Qantas is expected to provide details on how the airline is approaching the taxpayer-funded relief and how it looks to deal with the virus heading into the future. Despite Qantas announcing a broad reduction in its business operations, the third-quarter update might not reflect the full extent of the pandemic as it only covers the start of January until the end of March.
Rather than focusing on passenger services, Qantas will probably place a greater emphasis on its freight operations. The company currently has 12 freight planes that have remained operational during the pandemic. Qantas could also elaborate on the possible impact of record-low oil prices on the company's margins.
Should you buy Qantas shares?
Airlines and travel-related ASX shares have arguably been the hardest hit as a result of the coronavirus pandemic. Airlines like Qantas operate with large capital bases and leverage. As a result, predicting the full extent of the pandemic will be difficult to forecast.
In my opinion, Qantas is very 'investor friendly' with the company having a strong history of share buy-backs. The Qantas share price has rallied strongly after tanking more than 71% for the year to its low in mid-March.
With the future of Virgin Australia Holdings Ltd (ASX: VAH) remaining uncertain, Qantas could be well poised to expand its market share. In addition, record-low oil prices could also serve as a hedge for the company.
With that being said, I would probably wait until Qantas releases its trading update before buying shares in the company. Although it may not reflect the full extent of damage, it could help investors forecast future performances.
