Qantas profit slumps $330m as US-Iran war doubles fuel prices

Australia’s biggest airline has unveiled the full costings of the US-Iran war, with rising fuel prices smashing its bottom line.

In its latest market update, Qantas said profits slumped 13.1 per cent to $2.06bn, down $330m compared with this time last year.

The airline said the US-Iran war had directly hit earnings, costing the company more than $420m, as the price of fuel had more than doubled since February.

Qantas said if it didn’t take steps, including redeploying aircraft and lifting prices, costs would have been $610m.

Despite rising fuel prices, Qantas and Jetstar announced stronger revenues due to customer demand, with underlying earnings before interest and taxes rising to $1.44bn.

Qantas chief executive Vanessa Hudson said the company was operating in two very different environments, pre and post the US-Iran war.

“The final four months of the year saw business and consumer confidence fall as the conflict and economic headwinds created uncertainty, and some large corporates and government responded by managing their costs more tightly, reducing demand for travel,” Ms Hudson said.

“In response to the surge in fuel prices, we quickly adjusted fares and capacity and redeployed aircraft to give customers more options to fly to Europe.”

Qantas told shareholders it was reducing domestic capacity due to the impacts of the war, while it had also paused plans announced in April to buy back $150m of its own shares.

Originally published as Qantas profit slumps $330m as US-Iran war doubles fuel prices