Qantas Airways is well cushioned against any US-led economic slowdown after fiscal first-half earnings more than doubled to US$568 million from a year earlier.
Australia's largest airline by revenue and passengers carried also unveiled plans to sell, but retain control, of its travel services businesses.
The result for the six months through December beat profit forecasts of around $510 million for the half year, according to a survey of seven analysts.
Chief executive Geoff Dixon said the company, which dominates traffic on the lucrative route between Australia and the United States, had very good contingencies in place to respond to any US economic slowdown.
He said the company is ready to move very quickly if a recession in the US was starting to impact Qantas, but are not seeing any reduction in demand from the US.
He said there was no significant dampening in demand in most markets from the global economic slowdown, particularly the key domestic Australian and outbound international travel markets. Yet he said there had been some softening in the UK and continued weakness in Japan.
Dixon said further cost reductions of US$1.37 billion are targeted by June 2010 to better compete with foreign government-owned rivals.
The airline, which controls 68 percent of domestic and 32 percent of international traffic in Australia, said it is confident full year profit before tax for the year to June 2008 will be at least 40 percent higher than last year's record $902 million, up from December's forecast of around 40 percent growth.
Qantas said it will sell its holidays and business travel operations to Jetset Travelworld in return for a 58 percent stake in the enlarged travel agency.
Under the deal, subject to Jetset shareholder approval in April and clearance from competition and foreign investment regulators, Qantas will appoint four of seven directors to Jetset, which is anticipated to generate revenues of over US$730 million a year.
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