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Qantas profits fall by 17 per cent to $852 million, buyback scheme launched: Qantas financial results 2017

Qantas Launches New Flights between Melbourne and Exmouth

Qantas today reported an Underlying Profit Before Tax of $1,401 million and a Statutory Profit Before Tax of $1,181 million for the 12 months ended 30 June 2017.

The underlying result represents the second highest performance in Qantas’ 97 year history, down 8.6 per cent compared with last year’s record. It is slightly above the guidance range provided in early May this year, mainly due to strengthening of the Group’s domestic businesses. A drop in statutory profit before tax of $243 million reflects that the FY16 result included the gain on sale from the Sydney Domestic Terminal.

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Overall, the FY17 performance shows the Qantas Group’s margin advantage over local and global competitors[1] , which has been underpinned by completion of its three year transformation program.

SUMMARY OF RESULT

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In the domestic market, Qantas and Jetstar combined reached a record $865 million Underlying EBIT, making them again the two most profitable airlines in Australia with around 90 per cent of the total domestic profit pool.

Qantas International, which has faced high levels of capacity growth in the broader market, saw an improvement of conditions in the second half; it posted an Underlying EBIT of $327 million. Continued strength in its core markets helped the Jetstar Group deliver the second highest profit in its 13 years of operation.

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Qantas Loyalty booked a record $369 million Underlying EBIT on a 4 per cent increase in revenue as it continued to diversify its earnings.

The Group met all the objectives of its financial framework, reporting a 12-month return on invested capital of 20.1 per cent.  Another $470 million in transformation benefits were delivered, completing the three year program and outperforming the $2 billion target by $125 million.

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The Qantas Transformation Program has underpinned these results and enabled the Group to outperform its key domestic and international competitors.

This performance means Qantas is able to reward shareholders, recognise the hard work of its people and invest for customers.

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RETURNS FOR SHAREHOLDERS

The Qantas Board has declared a dividend of 7 cents per share (unfranked) to be paid on 13 October 2017 with a record date of 11 September 2017.

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A further on-market buyback of up to $373 million has been announced. Once this latest buyback is completed the number of Qantas shares is expected to have been reduced by more than 20 per cent since October 2015.

Since the transformation program began in February 2014, the total return for Qantas shareholders – including share price appreciation and distributions – has been around $9 billion. This has made the Group the top performer on the ASX100.

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INVESTING FOR CUSTOMERS

The Group will continue to invest in new aircraft, upgrading cabins and lounges, and extending its network of destinations.

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The airline’s fleet of 12 Airbus A380s will receive a significant upgrade to improve passenger comfort as well as route economics (see separate release). This will include replacing Skybeds in Business Class with the latest version of the Business Suite; increasing the size of the Premium Economy cabin and installing the same all-new seats that will debut on the Dreamliner at the end of this year; and refurbishment of the Economy and First Class sections. Work will begin in the second quarter of calendar year 2019.

Both the Business and Qantas Club lounges at Melbourne Domestic will be progressively renovated from November this year, providing customers more space, comfort and dining options before they fly. (See separate release)

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New lounges at both ends of the landmark Perth-London route will be completed during FY18, and two remaining A330s will have their cabins upgraded following lease extensions.

The rollout of Wi-Fi on the Qantas Domestic network (A330 and 737 aircraft) is expected to accelerate in late September 2017, once the current trial is complete and final regulatory approval for the new service is confirmed.

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Jetstar will invest in additional service training for 4,000 of its frontline employees as it continues to stimulate new travel demand with low fares. The airline will start a new route from Melbourne to the Central Chinese city of Zhengzhou from December 2017, which is expected to bring 35,000 Chinese tourists to Australia a year.

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He is an aviation journalist and the founder of Jetline Marvel. Dawal gained a comprehensive understanding of the commercial aviation industry.  He has worked in a range of roles for more than 9 years in the aviation and aerospace industry. He has written more than 1700 articles in the aerospace industry. When he was 19 years old, he received a national award for his general innovations and holds the patent. He completed two postgraduate degrees simultaneously, one in Aerospace and the other in Management. Additionally, he authored nearly six textbooks on aviation and aerospace tailored for students in various educational institutions. jetlinem4(at)gmail.com

Airlines

US DOT says Airlines must now pay automatic refunds for cancelled flights

US DOT says Airlines must now pay automatic refunds for cancelled flights

The U.S. Department of Transportation (DOT) has released a final regulation requiring airlines to quickly reimburse passengers with automatic cash refunds when owed, according to a statement made by the Biden-Harris Administration.

Under the new regulation, passengers will find it easier to get refunds when airlines dramatically alter or cancel flights, cause severe delays for checked baggage, or don’t supply the additional services they paid for.

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According to a statement from the Biden-Harris Administration, the U.S. Department of Transportation (DOT) has published a final rule mandating airlines to promptly compensate customers with automatic cash refunds when they are eligible. The new rule would make it simpler for customers to receive refunds from airlines in cases when they drastically change or cancel flights, cause significant delays for checked luggage, or fail to provide the extra services they charged for.

Under the latest rule from the USDOT, passengers are guaranteed refunds in several scenarios:

  1. Canceled or Significantly Changed Flights: Passengers are entitled to refunds if their flight is canceled or significantly altered, including changes in departure or arrival times exceeding 3 hours domestically or 6 hours internationally, departures or arrivals from different airports, increased connections, downgrades in service class, or changes less accommodating to passengers with disabilities.
  2. Delayed Baggage Return: Passengers filing mishandled baggage reports can claim a refund for checked bag fees if their luggage is not returned within specific timeframes after flight arrival.
  3. Unprovided Extra Services: If airlines fail to deliver paid extra services like Wi-Fi, seat selection, or inflight entertainment, passengers can request refunds for those fees.

The final rule streamlines the refund process, ensuring it is:

  • Automatic: Refunds are issued automatically without requiring passengers to request them.
  • Prompt: Airlines must refund credit card purchases within seven business days and other payment methods within 20 calendar days.
  • In Original Form of Payment: Refunds are provided in the original payment method used for purchase.
  • Full Amount: Passengers receive full refunds minus the value of any portion of transportation already used, including government and airline fees.

Suggest banning family seating junk fees and ensuring that parents can travel with their kids at no additional cost. No airline promised to ensure fee-free family seating prior to efforts from President Biden and Secretary Buttigieg last year. Family seating is now guaranteed free of charge on four airlines, and the Department is working on a plan to eliminate family seating junk fees.

Propose to make passenger compensation and amenities mandatory so that travelers are taken care of when airlines cause flight delays or cancellations. 

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Airlines

The Nine Freedoms of the Air – Jetline Marvel

The Nine Freedoms of the Air - Jetline Marvel

Most of us travel from one city to another city via road we need to get permission to that specific city if it is in another country like a visa or Road access permission to use its property for revenue purposes to carry passengers and Cargo. Similarly, In the airline Industry, it is also important that the Company have permission to fly and access that country whether it’s for stoppage flying above them, or Operating the passengers within that country This is called Freedom of the Air.

Some countries together they agree with certain conditions to access their Aerospace for to access for the airline to travel above their nation. If the bilateral is done for Their own countries’ airlines or other countries’ airlines. In this chapter, we understand how this thing is carried out. What all the condition has to look into that.  

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The Freedoms of the Air are international commercial aviation agreements (traffic rights) that grant a country’s airline(s) the privilege to enter and land in another country’s airspace. They were formulated in 1944 at an international gathering held in Chicago (known as the Chicago Convention) to establish uniformity in world air commerce. There are generally considered to be nine freedoms of the air.

Most nations of the world exchange first and second freedoms through the International Air Services Transit Agreement. The other freedoms,chase freedom airline miles when available, are usually established between countries in bilateral or multilateral air services agreements. The third and fourth freedoms are always granted together. The eighth and ninth freedoms (cabotage) have been exchanged only in limited instances

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First Freedom:

The basic permission granted to an airline from one country (A) to fly through the airspace of another country (B)

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The Nine Freedoms of the Air - Jetline Marvel

Second Freedom:

The permission for a commercial airplane from country (A) to land and refuel (often called a technical stop) in another country (B).

The Nine Freedoms of the Air - Jetline Marvel

Third Freedom :

The privilege for an airline to transport paying (Revenue) passengers from its home country (A) to another country (B).

The Nine Freedoms of the Air - Jetline Marvel

Fourth Freedom

The rights for an airline to transport paying (Revenue )passengers from another country (B) to the airline’s home country (A).

The Nine Freedoms of the Air - Jetline Marvel

Fifth Freedom

Fifth Freedom (also known as beyond rights): The rights for an airline to transport passengers from its home country (A) to a destination (B), then pick up and carry passengers to other international destinations (C).

The Nine Freedoms of the Air - Jetline Marvel

Sixth Freedom:

Sixth Freedom (Combination of Third & Fourth Freedoms) The right for an airline to carry passengers or cargo between two foreign countries (B and C), provided the aircraft touches down in the airline’s home country (A).

The Nine Freedoms of the Air - Jetline Marvel

Seventh Freedom:

The authorization for an airline to operate flights that start in a foreign country (B), skip its home country (A), and transport passengers to another international destination (C).

The Nine Freedoms of the Air - Jetline Marvel

Eighth Freedom Air

The rights for an airline to transport passengers from one location within a country’s territory (B) to another point within the same country on a flight originating in the airline’s home country (A). This right is commonly referred to as cabotage and is notably scarce outside of Europe.

The Nine Freedoms of the Air - Jetline Marvel

Ninth Freedom Air

The entitlement for an airline from a specific country (A) to begin a flight in a foreign country (B) and transport passengers from one location to another within that foreign country. This concept, also referred to as stand-alone cabotage, distinguishes itself from the traditional aviation definition of cabotage by not directly involving the airline’s home country.

The Nine Freedoms of the Air - Jetline Marvel
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Aviation

Air India’s B747 Makes Its Final Journey, Waving Farewell to Fans

Air India's B747 Makes Its Final Journey, Waving Farewell to Fans

In a poignant moment marking the end of an era in aviation history, Air India’s iconic Boeing 747 aircraft, affectionately known as the ‘Queen of the Skies,’ embarked on its ultimate journey from Mumbai’s international airport.

The departure, bound for Plainfield, USA, where it will undergo dismantling and part-stripping under the ownership of American AerSale, signals the closure of a storied chapter for the airline.

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Once revered for transporting dignitaries ranging from prime ministers to presidents, the Boeing 747 has etched itself into aviation lore. Yet, as airlines worldwide pivot towards more contemporary and cost-effective aircraft, Air India’s decision to bid farewell to its remaining Boeing 747s reflects the pragmatic realities of today’s aviation landscape.

The sale of these majestic planes to AerSale represents a strategic move by Tata Group, Air India’s new custodian, towards optimizing operational efficiency and embracing modern industry standards. Out of the four aircraft sold, two will be repurposed into freighters, while the remaining pair will be meticulously disassembled to salvage valuable components.

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The final flight from Mumbai witnessed a touching tribute as pilots performed a traditional ‘Wing Wave,’ symbolizing the conclusion of the Boeing 747‘s distinguished service with Air India. This poignant gesture encapsulates the deep sentiment attached to the aircraft’s departure and its significant contribution to the airline’s legacy.

As the Boeing 747 embarks on its journey to Plainfield, USA, nostalgia permeates the air, evoking memories of its maiden flight on March 22, 1971. Over five decades, Air India operated a total of 25 Boeing 747s, each leaving an indelible mark on the annals of aviation history.

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