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AUSTRALIA's Qantas Airways has reconfirmed to investors that the airline's full-year 2007 profit would likely increase 30 to 40 per cent above last year's figures.
The statement came after questions were raised by investors about the air carrier's financial outlook following the release of its interim results, and about the move by Airline Partners Australia - a private equity-backed consortium - to buy out the airline for A$11.1 billion (US$8.72 billion).
"Qantas today confirms that the full-year result (2007) is likely to be towards the upper end of the range," the company said in a statement.
The air carrier explained that the expectation was based on "continuing strong demand and yields offsetting cost-reduction targets, which have not been fully realised in the engineering and airport divisions".
The airline also responded to speculation raised about its outlook for 2008.
"Qantas is aware that there is a broad range of analyst PBT (profit before tax) estimates for the year ended 30 June 2008 ranging from approximately $975 million to approximately $1.5 billion with an average of $1.23 billion.
"In response to market speculation and queries received from investors, Qantas confirms its outlook expectations for 2008 are in line with average analyst consensus PBT estimates of approximately $1.23 billion."
Qantas also said that it had yet to assess the effect on its estimates of the recently announced intention of Tiger Airways to begin services in Australia and Virgin Blue's deployment of extra capacity through new Embraer aircraft and plans for Qantas to secure more planes to meet the new competition.
But the airline said these developments were likely to have a negative financial impact on the airlines 2008 results. "Until we know more about pricing, capacity and schedules, we are not in a position to quantify this impact," the statement said.
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