Half Year Interim Results The Winners and the Losers

The Winner

Air New Zealand are the big winners today announcing a half year interim normalised earnings of $180M NZD and an increase in passenger revenue, as well as a pre tax Statutory earnings of $197M NZD

The Loser

Qantas have today announced their underlying half year loss of $252M AUD before tax, with an action plan that will see job losses, fleet changes, and sale of terminal leases.

The Qantas changes
Qantas have announced that they have entered an agreement which will see the Brisbane Airport Corporation regain the lease of the Qantas Domestic terminal at Brisbane and related assets for $112M AUD.

Over the next three years Qantas will reduce their workforce by 5000 full-time positions which will include a reduction of 1500 management and non-operational roles, a restructure of line maintenance, as well as the already announced closure of the Avalon maintenance base and Adelaide catering base.  There will also be a reduction of operational roles relating to fleet and network changes, and the CNS flight crew base will close.

Qantas will make a change in timing to their MEL-DXB-LHR services from November 2014 to reduce on ground timing of the A380 in LHR.

Qantas will also end their PER-SIN services in first quarter FY15, while making all BNE-SIN and SYD-SIN services A330 replacing current B744 services.

Fleet Changes

Qantas will look to make savings up selling and differing up to 50 jets, this is broken up as follows;

• Boeing 767-300s - these will all be retired by Q3 FY15, following on from the retirement of the Boeing 737-400 fleet (see previous post)
• This will help Qantas standardise their domestic fleet to mostly 737-800 aircraft with Airbus A330 aircraft flying the East-West flights (SYD/MEL/BNE-PER) as well as peak services on the golden triangle (BNE/MEL/SYD) allowing the A332 fleet to operate International routes replacing B744s
• The 6 non-reconfigured Boeing 747-400 aircraft will be retired by the 2nd half of FY16 leaving just the 9 B744s with the A380 interior product.
• Deferral of the 8 remaining A380 orders (again)
• Deferral of the last 3 JQ B787-8 orders
• Restructring of the JQ A320 order book

Air New Zealand however will be adding aircraft;

• The A320 fleet will grow by 4 in FY14, 3 in FY15 and 2 in FY16 with the B733 retirements continuting with only 7 remaining in FY14, 2 in FY15 and all gone by FY16
• The B787-9s will arrive as follows FY15 3, FY16 3, FY17 2, FY18 2 this allows 3 of the B763 fleet to be retired by FY16 with the remaining 2 leaving in FY 17, while the last 2 744s will depart in FY15
• Two additional B773's will be delivered in FY15, 1 in 2014 and 1 in 2015
• 1 ATR76 will arrive in FY14, 3 in FY15 and the final one in FY16

The Releases

You can read the Qantas release to the ASX HERE and the Air New Zealand release to the NZX HERE, this story is also covered in almost every newspaper and website around.