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Volcano will not affect earnings – Joyce

written by WOFA | April 23, 2010

photo - Rob Finlayson
photo - Rob Finlayson

Despite admitting that it has been costing his airline over $1.5 million a day, Qantas CEO Alan Joyce told reporters on April 21 that he does not expect the disruption to European flights as a result of the Icelandic volcano eruption will materially affect Qantas’s earnings outlook.

“It won’t affect our earnings forecast. We will need to come out with the final numbers, but it won’t affect our position,” Joyce told reporters after speaking at a business lunch.

The Qantas CEO added that the disruption has cost the airline up to $10 million for the five days. “The large bulk of this cost we have incurred in looking after our passengers, which amounts to $700,000 a day.

“That is an obligation that is not covered by our insurance. That’s an obligation we have that is coming out of our own pockets.”

Qantas resumed services to London and Frankfurt on April 21 after receiving clearance from UK and German authorities to resume flying. The airline resumed its normal schedule on April 22, but will also mount additional services to clear the backlog of passengers it has. It has indicated that it may take between two and three weeks to move the backlog.

Qantas has forecast an underlying profit before tax of between $300 and $400 million for the 2009/2010 financial year.


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