Qantas (ASX:QAN) shares open strong on ASX; here’s why

October 13, 2022 12:03 PM AEDT | By Ritwika

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Qantas (ASX:QAN) shares open strong on ASX; here’s why — Image source: © Iwikoz6 | Megapixl.com

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Highlights:

Qantas has lately been experiencing ‘strong travel demands’ that have boosted its business recovery rate from the COVID-19 crisis.

Therefore, the airlines company expects to deliver AU$1.2 to AU$1.3 billion in underlying profit before tax in H1 FY23.

Backed by this update, Qantas’ shares were spotted trading 11.992% higher on ASX at 10:51 AM AEDT.

Australian airlines company Qantas Airways Limited (ASX:QAN) announced today that ‘strong travel demands’ has boosted the company’s business recovery rate from COVID-19 impacts in recent times.

As a result, Qantas opened Thursday’s trading session on a stronger note on ASX. Qantas’s shares were quoted at AU$5.790 per share after gaining by 11.992% on ASX at 10:51 AM AEDT today (13 October 2022).

Details from Qantas’ latest business updates:

Qantas announced today that it has successfully been investing in its customers and employees and maintaining a strong balance sheet at the same time, driven by a ‘strong travel demand’. As a result, the company has experienced a faster rate of business recovery in the recent time from the COVID-19 crisis period.

As a result, the airlines company is expecting to deliver an underlying profit before tax worth AU$1.2 to AU$1.3 billion in H1 FY23 based on forward booking and current fuel prices.

This was followed by a consecutive heavy loss incurred by the company due to the COVID-19 outbreak.

Furthermore, Qantas is also expecting its net debt to fall and come down between AU$3.2 to AU$3.4 billion on 31 December 2022, which is below the bottom target range of AU$3.9 billion.

Qantas’ new wage policy:

Qantas has also announced some amendments to its wages policy that covers around 20,000 employees of the company. The airline company has finally decided to increase the annual wage of its employees by 2-3% after an almost two-year freeze due to the COVID-19 crisis. Therefore, it represents an additional AU$40 million per annum before compounding, and it also shows a bounce back to the company’s pre-COVID-19 level of the increase driven by a speedy business recovery.

Alan Joyce, Chief Executive Officer, Qantas Airways Limited, said:

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