Qantas Airways Limited (QAN) has reiterated its pre-tax profit guidance for FY09 after posting record profit result yesterday. The group said assuming no further deterioration in economic conditions, the 2009 result would be in line with consensus forecasts.
CEO Geoff Dixon said that Qantas, and the airline industry as a whole, was facing major challenges.
"Analyst consensus forecasts as at 21 August 2008 cover a wide range, between $428 million and $1,019 million, with an average of $751 million," the airline said.
Mr Dixon said the rapid rise in fuel costs since December last year was unprecedented and the impact had been felt across the aviation industry and the world economy.
At current prices he said the group's fuel expense would be over $1.6 billion higher in 2008/09.
He said the group had hedged 81% of its crude oil price exposure at a worst case all-in cost of US$118 a barrel.
"This cover is all in options, which will allow Qantas to benefit if prices fall," he added.
"Although fuel prices have eased over the past month, they have not declined to levels that will sustain the current level of profitability, and fuel and economic conditions continue to be uncertain."
At 1147 AEST, Qantas was down 4c to $3.44.