Qantas (ASX:QAN) share price hits YTD peak

Highlights 

  • Qantas shares reached YTD peak of AU$5.5 per share on the ASX today.
  • QAN has witnessed an oversubscription on its bond refinancing.
  • QAN has managed positive cash flows despite statutory losses in FY21.

ASX listed airlines operator Qantas Airways Limited (ASX:QAN) shares on ASX have hit a YTD high price of AU$5.55 per share today. In addition, QAN has shared updates on an oversubscribed bond today. The group has also shared its annual report for FY21.

Why are QAN shares up?

Qantas (ASX:QAN) has completed a bond refinancing with an oversubscription on its seven-year AU$500 million unsecured bonds. The bond has a coupon of 3.15% and shall refinance an AU$300 million bond maturing in May 2022. It is aimed to boost liquidity, repay maturing debt and repair the balance sheet. Qantas has maintained its investment-grade credit rating throughout the pandemic, and it was reflected in the oversubscribed bond refinance.

  • QAN has reported an Underlying Loss Before Tax of AU$1,826 million, a decrease of AU$3,152 million compared to the pre-COVID period.
  • QAN has reported the Group’s Statutory Loss Before Tax at AU$2,351 million adverse from pre-COVID 2019/20.
  • The Statutory Loss Before Tax included a net AU$525 million of costs, coming from non-cash impairments and redundancy expenses, not part of QAN’s Underlying results.
  • During FY21 the groups’ total revenue was AU$5,934 million, down 67% compared to pre-COVID 19/20.
  • It reported a Statutory Earnings Per Share at a loss of 91.8 cents per share.
  • However, its operating cash costs have decreased 62% as compared to 2018/19.
  • QAN also delivered a positive Statutory Net Free Cash Flow in H2 of the financial year 2021, enabling the commencement of debt reduction.

Bottom Line

Qantas shares have remained unaffected from reported statutory losses. A positive cash flow position has helped it begin debt reduction. As a result, it has managed an oversubscription for bond refinancing. All of which got reflected in its share price today.

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