Qantas warns first-half fuel bill could jump by A$200 million

By Alice Uribe

SYDNEY -- Qantas Airways (AU:QAN) said its fuel bill for the first half of fiscal 2024 could increase by 200 million Australian dollars (US$128.82 million) due to higher oil prices and a lower Australian dollar.

Australia's flag carrier said Monday that it expects its first-half fuel bill to rise by 7.7% to A$2.8 billion after hedging if the growth in energy prices is sustained. Fuel prices have increased by around 30% since May, including a 10% spike since August, Qantas said.

"The group will continue to absorb these higher costs, but will monitor fuel prices in the weeks ahead and, if current levels are sustained, will look to adjust its settings," Qantas said. "Any changes would look to balance the recovery of higher costs with the importance of affordable travel in an environment where fares are already elevated."

At the same time, Qantas said it expects a further A$50 million impact due to non-fuel related foreign exchange changes.

Also Monday, Qantas said it plans to invest another A$80 million in improving customer service after a series of missteps, which have included allegations by an Australian regulator that it had been dishonest with customers by advertising tickets for more than 8,000 flights it had already canceled.

Qantas said the planned investment is in addition to the A$150 million that it had previously budgeted and would be funded from profits.

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09-24-23 2100ET

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