The Qantas Airways Ltd (ASX: QAN) share price will be on close watch Thursday morning after the airline reported its first-half FY25 results.
Qantas shares finished the session at $8.89 apiece yesterday, after a turbulent take-off from the runway in 2025. Shares are down 2.2% this year to date.
Let's see what the flying kangaroo put in during the first half.
Qantas share price in focus after H1 FY25 results
Qantas announced several highlights from its H1 FY25 numbers. Here are the major takeouts:
- Total group revenue of $12.13 billion, up 9% year over year.
- Revenue from Qantas Loyalty grew by 11%, with a 10% increase in active members.
- Profit before tax increased by 11% year over year to $1.39 billion.
- Whereas net profit grew by 6% to $923 million.
- Paid a $250 million dividend, plus an additional $150 million special dividend, both fully franked.
What else happened in H1 FY25?
The Qantas share price had a reasonably strong period in H1, as did the business, with modest growth from top to bottom lines.
As a group, the airline carried 28 million customers.
Revenues were up 9% over the year, leading to an 11% growth in pre-tax profit to around $1.4 billion.
The group's return on invested capital (ROIC) was 54.6%, a slight dip from the 58% recorded this time last year but still high compared to the average Australian business.
Management explained this, noting the group's "current level of invested capital is unusually low and the reported ROIC unsustainably high".
Long-term, a core goal of Qantas' "financial framework", is for its ROIC to be higher than its weighted average cost of capital (WACC) "through the cycle".
Meanwhile, memberships in its loyalty program tallied 17 million, up 11% year over year. The segment produced pre-tax income of $255 million.
Qantas also pressed on with its fleet renewal strategy, investing in new aircraft and cabin upgrades. During the first half, the airline added 11 new aircraft, with more on the way in H2.
The company also said its 737 aircraft will receive new cabins, including "next generation Business and Economy seats and larger overhead lockers".
What did management say?
Qantas CEO, Vanessa Hudson, mentioned the company's fare structure as a positive.
The Group's performance highlights the benefits of having both a premium and a low fares airline and a strong loyalty program. With a growing fleet of new aircraft, Jetstar went from strength to strength delivering a better experience for customers and an improved financial performance. Importantly, Jetstar was able to help more Australians take a holiday for less.Qantas Domestic revenue grew strongly and, like Jetstar, will see significant benefits as its fleet renewal ramps up, starting with the arrival of the A321XLR in the coming months. We're seeing progress from the investments we are making for our customers and people but we know there's more work to do to consistently deliver in the moments that matter.
This is a key part of rebuilding trust and continues to be our focus.
Australians have always loved to travel and continue to prioritise it over other spending options. Looking forward, we continue to see intention to travel from leisure and corporate customers remaining high.
Our financial strength means we are now in a position to pay our shareholders dividends for the first time in almost six years.
What's next?
Looking ahead, Qantas expects to see "strong travel demand" across both domestic and international markets.
Management projects a 3% to 5% increase in domestic unit revenue for the second half of FY25, with international unit revenue expected "to be flat".
Qantas is projected to show a 1% decline in sales compared to FY24, while Jetstar is projected to grow revenues by 5%.
Meanwhile, net freight revenue is expected to grow by $10 million to $30 million over the second half.
Fuel costs are estimated to be in the range of $5.2 billion, including hedge costs of around $70 million.
Qantas share price snapshot
The Qantas share price is on the radar this morning after the company posted its H1 FY25 results.
Zooming out, the stock is up almost 72% in the past year, a substantial outperformance over the broader market.
