Qantas to recoup fuel bill on strong ticket demand

Bloomberg

Qantas Airways Ltd. expects to completely recover higher fuel costs this fiscal year due to strong demand for air travel, even after rising oil prices dented first-half profit.
The airline’s first-half underlying profit before tax fell 19 percent to A$780 million ($559 million) from a year earlier but Qantas announced more returns to shareholders with a A$305 million stock buyback.
Qantas’s expectation that it will recover higher fuel costs for the full year reflects the airline’s dominance in its home market, as well as a moderation in the oil price towards the end of 2018. That moderation is reflected in the airline’s forecast for its fuel bill this year to be A$3.90 billion — less than the A$4.09 billion it previously anticipated. Qantas is keeping capacity growth flat across its domestic and international routes in the second half. That’s helping it manage the fuel bill by minimizing empty seats.
“Looking ahead, we’re seeing strong forward bookings,” CEO Alan Joyce said in a statement. “Competitor capacity growth has slowed internationally and is relatively flat domestically. And oil prices have declined from the peaks we saw late last year.”
“These factors point to a strong second half and we expect to completely recover our increased fuel costs by the end of this financial year,” Joyce said.