Qantas Airways delivered a solid half-year performance with a 5.1% rise in underlying profit before tax to $1.456 billion, underpinned by strong travel demand and fleet renewal. The Group announced a fully franked interim dividend of $300 million and a $150 million on-market share buy-back.
- Underlying profit before tax up 5.1% to $1.456 billion
- Statutory profit after tax steady at $925 million
- Fully franked interim dividend of 19.8 cents per share declared
- On-market share buy-back of up to $150 million announced
- Jetstar Asia ceased operations; Jetstar Japan divestment underway
Strong Financial Performance Amid Fleet Renewal
Qantas Airways Limited has reported a robust financial performance for the half-year ended 31 December 2025, with underlying profit before tax increasing by 5.1% to $1.456 billion. This growth was driven by a 6.3% rise in revenue to nearly $12.9 billion, supported by strong domestic and international travel demand, ongoing fleet renewal, and momentum in its loyalty program.
Statutory profit after tax remained steady at $925 million, reflecting the inclusion of one-off costs such as the closure of Jetstar Asia, employee ownership plan awards, cyber incident management, and legal provisions. Despite these headwinds, Qantas maintained a solid operating margin of 12%, underscoring operational resilience.
Shareholder Returns and Capital Management
The Board has declared a fully franked interim dividend of $300 million, equivalent to 19.8 cents per share, marking an increase from the prior period. Additionally, Qantas announced an on-market share buy-back program of up to $150 million, signalling confidence in the Group’s cash flow and capital position.
Net debt stood at $5.6 billion, comfortably within the Group’s target range of $5.6 billion to $7.0 billion for the financial year, reflecting disciplined capital management aligned with its Financial Framework. Capital expenditure rose 27% to $1.8 billion, primarily due to fleet investments including new deliveries of A321XLRs, A220-300s, and A320neos.
Operational Highlights and Strategic Moves
Qantas continued to expand and modernise its fleet, enhancing fuel efficiency and customer experience. The Group opened new lounges, upgraded in-flight services, and introduced Economy Plus seating across multiple aircraft types. Domestic operations delivered an underlying EBIT of $676 million, while international operations, including freight, contributed $300 million.
Jetstar Group achieved a record underlying EBIT of $492 million, boosted by capacity growth and operational improvements, despite the strategic closure of Jetstar Asia in July 2025. The Group also signed a non-binding Memorandum of Understanding with Japan Airlines to divest its stake in Jetstar Japan, focusing capital on core Australian operations.
Risks and Future Outlook
Qantas highlighted ongoing risks including cyber security threats, industrial relations pressures, fuel price volatility, and regulatory changes. The Group’s proactive risk management and investment in technology aim to mitigate these challenges. With a strong balance sheet and strategic fleet renewal, Qantas is positioned to capitalise on sustained travel demand and deliver shareholder value.
Bottom Line?
Qantas’ disciplined capital strategy and operational momentum set the stage for sustained growth, but legal and market risks warrant close watch.
Questions in the middle?
- How will the divestment of Jetstar Japan impact Qantas’ international growth strategy?
- What are the potential financial implications of ongoing legal proceedings, including the Flight Credits Class Action?
- How will fuel price volatility and foreign exchange fluctuations affect Qantas’ cost structure in the coming periods?