Qantas Airways Ltd. announced its fourth stock buyback in two years as the airline reported better-than-expected annual earnings, marking the end of a three-year turnaround under Chief Executive Officer Alan Joyce.
Qantas said customer research showed the transit stop was often one of the most stressful parts of a journey, particularly where a connecting flight was involved.
Earnings before interest and tax (EBIT) in the airline's domestic business were A$67m higher than past year at A$645m, thanks to capacity management and cost cutting.
The firm, which hopes to fly non-stop from Australia to London and NY by 2022, announced a 17.2 percent slip in annual net profit of Aus$852 million (US$673 million) after record results past year.
The airline says direct flights between Sydney to London would cut the total journey time of its current Sydney to London routes, which feature connections, by up to four hours. While earnings at its worldwide business dropped, the local market helped profit beat analyst estimates.
"Use them", Leeham Co analyst Bjorn Fehrm said in a note to clients speculating about a 10,000-nautical-mile polar route in June, Reuters noted. Its worldwide business has the higher risks, but it margin is reasonable healthy so a bit of space it available.
Meanwhile, the carrier on Friday posted a full-year net profit of $852 million, down 17 percent.
Group wide revenue fell by 1 percent A$16 billion.
(Rugby) Cheika blames defensive inadequacies for New Zealand defeat
He was criticised for finding the positives from Australia's second-half comeback. The All Blacks took a 40-6 lead to halftime and the game was already over.
The 97-year old airline declared a final dividend of 7 Australian cents a share, the same as the previous year.
Shares in Qantas jumped the most in nearly two months in Sydney on Friday.
Originally, Qantas was aiming to enable access speeds of up to 20Mbps per passenger, with satellite communications service provider ViaSat looking to provide a service-level guarantee to Qantas of 12Mbps at all times throughout the flight once the service leaves beta mode.
Meanwhile, Qantas said its worldwide business was operating in a "very competitive" environment, with "competitor capacity growth and sharper pricing activity".
Now, Qantas is taking a larger share of domestic profits from money-losing Virgin. It was down 8.6 percent from the record level set in the 2016 fiscal year.
Qantas has challenged Airbus and Boeing to accomplish something that's never been done: Deliver an aircraft capable of flying nonstop from Sydney, Brisbane, and Melbourne to NY and London filled with passengers and cargo.
Two aircraft have ranges that come close to the distance required: the long-range version the Airbus A350 and the Boeing 777X, which is under development.
Airbus said in a statement its A350-900 ULR will be in service next year for flights of up to 20 hours. Next year the airline plans to operate non-stop between Perth and London. Qantas sacrificed profit margin on global routes, contributing to a 36 per cent fall in EBIT to A$327m.