Performance against our Recovery Plan

How we’re delivering against our six key areas of focus as we manage the impact of the pandemic.


In June 2020 the Qantas Group announced a three-year recovery plan in response to the COVID-19 pandemic. This plan will create a stronger platform for future profitability and growth, and deliver long-term shareholder value.

The key areas of focus for the plan are:

  • Cash flow
  • Fleet management
  • Qantas Loyalty
  • Deleverage the balance sheet
  • Cost savings
  • Customer Brand and employee engagement

1. Net capital expenditure is equal to net expenditure cash flows included in the Consolidated Cash Flow Statement and the impact to Invested Capital from the disposals/acquisitions of leased aircraft.
2. 12 per cent Underlying EBIT growth from 2H21 to 2H22.
3. Resized in line with forecast earnings and cash liquidity levels, with competitive cost of existing debt in rising interest rate environment.
4. $0.6b and $0.8b were original targets for FY21 and FY22. $920m has been delivered program to date.

Cash flow

The Group is targeting sustainable positive net free cash flow from FY22 onwards. This metric was achieved in the second half of FY21.

Aligned with the Financial Framework, the Group was also able to reduce its capital expenditure to align with the underlying operating cash flow of the business, with the Group's capital expenditure of around $700 million in FY21.

Fleet management

In FY21, the Group delayed the delivery of its new A321neos and Boeing 787-9 aircraft to meet the Group’s requirements.

The Group also brought forward the retirement of its last six 747s and placed its 12 A380s in long term storage. The Group is currently planning for five of the A380s to re-enter service from mid-2022. In total, 10 of Qantas’ A380s with upgraded interiors are expected to return to service by 2024 with the remaining two A380s to be retired.

Qantas Loyalty

Qantas Loyalty has returned to double digit earnings growth at the end of FY22, with 12 per cent underlying EBIT growth from 2H21 to 2H22.  Financial year 2022 also saw the third consecutive year of Qantas Loyal contributing greater than $1 billion of gross receipts towards the Group cash result.

It is targeting an Underlying EBIT of $500-600 million by FY24.

Deleverage the balance sheet

As part of the financial framework, the Group is targeting a gross debt reduction of $1.3 billion by FY23. This target has been resized in line with forecast earnings, cash liquidity levels and the competitive cost of existing debt in a rising interest rate environment.

The Group’s Net Debt was at $3.9 billion at the end of June 2022 (below the target range of $4.2 billion to $5.2 billion) and was at the lowest level since the GFC. This was driven by the rapid recovery in Group network through 2H22 underpinned by the easing of COVID-19 restrictions and full stand up of the workforce.

The Group is also targeting for Net Debt / EBITDA to be less than 2.5 times which is now expected by the end of financial year 2023.

Cost savings

The Qantas Group has a target to reduce costs by $1 billion annually from the end of FY23, when compared to FY19. The Group is ahead of target with $920 million in cumulative benefits achieved by FY22. As at 30 June 2022, all initiatives that make up the $1 billion have commenced and more than 90 per cent have been completed. The Group is on-track to reach the target of $1 billion in restructuring benefits by the end of FY23.

The Group also completed 8,500 in exits by FY21 and 9,800 exits by FY22. It is targeting a 10 per cent reduction in group Unit Cost (ex-fuel and depreciation) in FY23 compared to FY20.

Customer, brand and employee engagement

To ensure our competitive advantage the Group aims to maintain its Customer Advocacy (NPS) premium over its domestic competition. While operational issues have impacted customer NPS, our premium to competitors has been maintained in FY22. The Group has plans in place to restore operational performance to at least pre-COVID levels by September / October 2022.

We are also targeting to maintain our brand and reputation throughout the three-year program. We are on track with long term brand preference metrics remaining stable despite operational disruptions.

Importantly, the focus on our people remains constant throughout the three-year recovery program.

Despite the challenges of restructuring and stand-downs that punctuated 2020 and 2021, sentiment surveys showed that employees remained proud and confident in the future of the Qantas Group. Actions were undertaken to support our people including secondary employment and career transition support, ongoing professional development, retention and readiness payments, extension to JobKeeper payments and staff travel enhancements. Employee sentiment has been impacted by operational issues, but the Group has plans in place to improve with more than $400 million in initiatives announced in August 2022 to share the benefits of recovery with our people.

FY24 Targets

FY24 targets chart

Beyond the three-year recovery program, which is due to be completed in FY23, the Group has reaffirmed the FY24 targets which were originally announced at the 2019 Investor Day. By achieving these targets, the Group is aiming to have top quartile shareholder returns.

The Group is targeting the following:

  • Qantas Domestic - Targeting EBIT margin ~18 per cent
  • Jetstar Domestic - Targeting EBIT margin ~22 per cent
  • Qantas International - Targeting ROIC >10 per cent
  • Jetstar International - Targeting ROIC >15 per cent
  • Qantas Loyalty - Targeting $500-600 million EBIT
  • People - Continued improvement in employee engagement
  • Customer - Maintain Net Promoter Score premium to competitor

Delivering today