Qantas Airways of Australia announced on Monday that due to rising fuel prices, it anticipates its fuel bill to increase by approximately A$200 million ($128.80 million) in the first half of the 2024 fiscal year.
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The airline stated that fuel prices have risen by about 30% since May 2023, including a 10% increase since August. This surge is attributed to a combination of higher oil prices, increased refiner margins, and a depreciating Australian dollar. In addition to the fuel-related costs, Qantas expects an additional impact of A$50 million due to non-fuel-related foreign exchange changes in the first half of the current fiscal year.
In response to reputational damage following a lawsuit by the country's competition regulator for selling tickets on thousands of already-canceled flights, Qantas plans to invest an additional A$80 million in fiscal 2024 to address "customer pain points". This initiative will include enhancements to call center resources, increased availability of frequent flyer seats, and a review of longstanding policies for fairness.
The airline confirmed that this customer-improvement initiative would be financed from its profit. For the fiscal year ending June 30, it reported an annual underlying profit before tax of A$2.47 billion, a significant turnaround from a loss of A$1.86 billion the previous year.