Airline Report In Australia

1539 words - 7 pages

QANTAS 2015 v 2013-2014 results

Executive Summary

Company Overview – 320 words
Qantas was founded in 1920 and has grown to be Australia’s largest domestic and international airline. The key market is the transport of airline passengers both domestic and internationally however, the group has expanded to include Qantas freight, Jetstar and Qantas frequent flyer. Qantas holds a market share of 65% through its Qantas and Jetstar operations.
The company has successful duel branding strategy between Qantas and Jetstar. Qantas offering a full cost service and Jetstar, the low cost carrier airline which has driven significant growth over recent years including its international ...view middle of the document...

Investors in Qantas bonds enjoy stronger returns than bonds from similarly rated corporates in the Australian market, whilst maintaining an investment grade exposure.

Current Market - 350words – 167 words

Qantas has certainly been on shaky ground over the last few years with a record deficit in 2013 however, a major turnaround has happened and the Group reported a profit in 2015.

In 2011, Qantas presented a strategic plan to grow the business and turn the profitability to a positive result, refer Reference 1. Qantas retired the older planes and replaced with smaller capacity per planes, but longer operating ranges with lower operating costs. This in turn had a major impact on the costs, the major impact was the cost per available seat kilometre fell. The other cost reduction comes from external factors, which is the decline in fuel costs and the repeal of the carbon tax. From these savings Qantas proved to make great cost savings and obviously had an impact, reflecting in the 2015 financial result.

In February 2014 the Qantas share price was $1.16, in 2015 it was $3.45. Joyce (The current CEO) has taken a long-term view on strategies and this is reflected in the share price.

Profitability – 388 words

Profitability is an important measurement in all business, measuring current and past profitability and projecting future profitability (via budgeting or forecasting) is vital for the success of the business. The three components to measuring profitability is Sales, Assets and Equity.

Profitability is measured by the income statement (also known as profit and loss statement). It is measured with income and expenses. Income is money generated from the activities of the business however, money coming into the business from activities like borrowing money do not create income. This is simply a cash transaction between the business and the lender to generate cash for operating the business or buying assets. Expenses are the cost of resources used up or consumed by the activities of the business. The components for the analysis with Qantas based on 2014 v 2013 are Gross Profit Margin, Net Profit Margin, Rate of Equity, Rate of Investment and Rate of Assets.

Gross Profit Margin (GPM) is calculated by Revenue - Cost of Goods Sold / Revenue. In 2013 GPM is 2% and in 2014 is -3%. GPM is used and measured to benchmark against other industry competitors, showing a negative result is the outcome of expenses exceeding the revenue amount. In 2014, expenses are $M15,792 and revenue is $M15,352 (Refer Appendix 1, pg.3). In 2013 GPM showed a 2% GPM, in this instance revenue is higher than expenses, $M15,902 v $M15,530 respectively (Refer Appendix 2, pg.7) To avoid a negative GPM costs must be cut to obtain the achieved level of GPM, alternatively revenue needs to increase or a combination of both. Air New Zealand had a GPM of 8.64% which is much higher than the 2013 Qantas result (Refer Appendix 3, pg.2).

Net Profit Margin (NPM) is Net...

Other Papers Like Airline Report in Australia

Strategic Management and Strategic Competitiveness Essay

1385 words - 6 pages industry earn above-average returns. This paper will explain how the Airline industry’s success is through its mission and vision statements with Southwest Airlines as an example. Finally, this paper will evaluate how the importance each category of the stakeholder impacts are to the overall success of the Airline industry. Globalization and Technology In today’s business industry, the

Principles of Amnagement Essay

1013 words - 5 pages ORGANISATIONAL CULTURE: decision to close Kingfisher Red and how it has got to do with the organization culture more than anything else. I think that why Kingfisher failed to bear the fruits of acquiring Deccan is essentially why most M&A’s fail. Cultural disparities!! Technology: 1.Kingfisher is the largest Indian private airline and has their own reputation in the market. Kingfisher was the first largest Indian airline to have in

Analysis of Emirates Airlines

1203 words - 5 pages Analysis of EA: Emirates Airline (EA), established in 1985, is the national airline for the emirate of Dubai. In its 25 years of operation, it only incurred losses in its second year, 1986, and has been profitable since then, making it the most profitable airline company in the world, according to the latest statistics (Metro, 2010). It is wholly owned by the United Arab Emirates (UAE) government and in the FY2009, it operated 142 aircrafts

Finance Futures

680 words - 3 pages they've been talking about $10 fares and $40 fares and the reality is Australia is not Asia, it's a different market, and for people to talk of $10 fares, well, guess what - we gave away 25,000 $1 fares just a few months back, and if they match that, that would basically be about 14 days worth of flying for them. They're not going to last very long to give away all their seats at $10 or $1. PETER RYAN: If successful in its application, Tiger's operations won't start until the end of the year, giving Virgin and of course Qantas enough time to lay the ground for yet another strategic battle for airline customers. ELEANOR HALL: Business editor Peter Ryan.

Aviation Industry

2088 words - 9 pages rationale B) Write the rationale SECTION C NOTES Potential Airlines * Virgin Australia: * Established in 2000, is currently Australia’s second largest airline. * Originally established as low-cost airline, has designed itself on new world principles, with low cost, but higher levels of service to rival Qantas in business travel. * Jetstar: * Established in 2003, Jetstar is a low-cost airline which is a

Global Business Report ( Quants )

1073 words - 5 pages Business report Executive summary Qantas formally known as Queensland and northern territory Aerial services nicknames the flying kangaroo is the one of the largest airlines in the world and oldest second oldest airline. Qantas was founded in 1920 by Paul McGuiness and others. Qantas has expanded greatly throughout the years due to the methods of expansion employed by the business. Qantas had succeeded in this and in 2004 Qantas was

Foreign Subsidiary Investment Plan Case: Multinational Capital Budgeting China & Australia

5529 words - 23 pages Australia 17 2. Airline Industry in China 18 PART II-Capital Budget Analysis 1. Weighted Average Cost of Capital 19 2. Net Present Value 20 3. Scenario Analysis 21 PART III – Conclusion: Investment Decision 23 References 24 Appendixes 26 PART I – Analysis: Australia vs. China A

Virgin Atlantic Airways (VS) 1984-1999

4556 words - 19 pages would also be available. Virgin had also acquired a license to fly to Singapore and Australia. And in March of 1992 Branson would fly to Johannesburg to finalize agreements for the regular Virgin service to South Africa.3Branson made no secret of Virgin's ambitions: by 1995 he wanted Virgin's fleet of planes to have expanded to eighteen, and the airline to be flying to the world's top twelve cities. And by then, he announced, he expected Virgin to

Managing Change

1521 words - 7 pages SERVICE AND OPERATIONS Australia group of companies The Qantas Group’s has its main business set in the transportation of passengers through around the world for business, leisure, delivery of commercial goods and other personnel service. Altogether The Qantas Group’s have been using two alliance airline brands to cater for the worldwide market which are Qantas and Jetstar. Qantas is the world's second oldest airline. Founded in the Queensland

American Airline case report

1924 words - 8 pages MKT 6350 Fall 2015 Competitive Marketing Strategy Ram C Rao Questions for American Airlines Please keep the total length of the report to less than 12 pages double spaced. 1. (10+10 points) Assess the old pricing policy. What are the forces that led it to arise? What forms of price segmentation are used? Old policy After the wake of deregulation. Free from controls, American Airline were able to set the

Qantas Case Study

3222 words - 13 pages (Question 2) Qantas is an Australian company that operates in the airline industry. The following is the assessment and evaluation of Qantas as a going concern. In arriving at a decision as to whether Qantas is a going concern, the following ratios were calculated. Qantas’ total profit before income tax expense increased 2.3% from 6.4% to 8.7% this past financial year (Annual Report 2008, p.51). Ratios: Current ratio = current assets

Related Essays

Report Writing On Gambling In Australia

4500 words - 18 pages every day. Gambling is currently one of the biggest social issues in Australia. This report is authorised by Brenda Christiansen of Metropolitan South Institute of Tafe, Mount Gravatt Campus for assignment; Produce research Reports for Subject; FNSICGEN501B. INTRODUCTION Delete any unnecessary headings and renumber where necessary Background Information Insert here a brief summary of the organisation/department, sufficient to provide

Report Writing On Gambling In Australia

4481 words - 18 pages Australia. This report is authorised by Brenda Christiansen of Metropolitan South Institute of Tafe, Mount Gravatt Campus for assignment; Produce research Reports for Subject; FNSICGEN501B. INTRODUCTION Delete any unnecessary headings and renumber where necessary Background Information Insert here a brief summary of the organisation/department, sufficient to provide background information, which supports the purpose of the report. In the

Report Writing On Gambling In Australia

4470 words - 18 pages Australians do every day. Gambling is currently one of the biggest social issues in Australia. This report is authorised by Brenda Christiansen of Metropolitan South Institute of Tafe, Mount Gravatt Campus for assignment; Produce research Reports for Subject; FNSICGEN501B. INTRODUCTION Delete any unnecessary headings and renumber where necessary Background Information Insert here a brief summary of the organisation/department, sufficient

Kingfisher Vs Indian Airlines Essay

2126 words - 9 pages Club has won Top Honours at the 21st Annual Freddie Awards in the Japan, Pacific, Asia and Australia region. Kingfisher Airlines has received three global awards at the Skytrax World Airline Awards 2010 Named Best Airline In India / Central Asia; Best Cabin Crew – Central Asia. Kingfisher RED named Best Low Cost Airline in India / Central Asia. NDTV Profit Business Leadership Award for Aviation. Rated India's Second Buzziest Brand 2008Â