Australian airline Qantas Airways Ltd
(ASX:QAN) has reported an 88 per cent fall in full year net profit this morning, and announced plans to cut costs by $1.5 billion over the next three years.
The new cost reduction program called Q Future, will target $1.5 billion in permanent savings over the three years, starting with a target of $500 million in the current financial year.
The airline posted net profit for the year of $117 million, down from a profit of $969 million a year earlier.
Sales for the 12 months to June 30 fell 6.9 per cent to $14.55 billion.
Qantas says there are signs of an improvement in passenger numbers, and that yields have stabilised at levels experienced in the second half of the 2009 financial year.
However the airline says high levels of volatility in the economic outlook, industry capacity, passenger demand, fuel prices and exchange rates continue, and given the high level of uncertainty it is not possible to provide any profit guidance.
Qantas says it will not pay a dividend for the year. Qantas’ 2008 net profit reached close to $1 billion, its best result in the last five years.
Building and construction materials manufacturer Boral Ltd (ASX:BLD) has reported 42 per cent fall in full year net profit impacted by a sharp downturn in market activity in the U.S. and Australia.
Net profit after tax for the year to June 30 came to $142 million, down from $243 million the year before.
Boral’s underlying earnings before interest, tax, depreciation and amortization declined 22 per cent to $539 million due to significantly weaker housing markets in the U.S. and Australia.
Sales revenue fell 6 per cent to $4.9 billion, reflecting a 5 per cent decline in Australian revenues and a 19 per cent decline in revenues from the U.S. business; however revenue from Asia rose 15 per cent.
CEO Rod Pearse says that the impact of the global recession created unprecedented market challenges in fiscal 2009, which intensified in the second half of the year.
Mr Pearse says current market conditions are expected to broadly continue during the first half of fiscal 2010, however second half levels are expected to be stronger than in the December 2009 half but says it is difficult to forecast at this time.
Boralamortisation declared a final dividend of 5.5 cents a share. Boral’s profits have been decreasing over the past four years.
Mineral sands miner Iluka Resources Ltd (ASX:ILU) has reported a net loss of $55.8 million for the first half of 2009, and says that the expected improvement in its earnings has been delayed due to the economic crisis.
Iluka’s loss compares to a profit of $15.6 million in the first half of 2008.
Revenue fell 57 per cent to $182.3 million, with the company deciding not to declare a dividend.
The miner says the improvement in earnings it expected to see has been delayed due to the economic crisis, which brought into play both an extremely challenging sales environment across the mineral sands industry but also some opportunities to accelerate the rate of change in the business.
Iluka says it is well placed to benefit from China’s continuing growth and global economic recovery, with the impending completion and integration of the company’s two new higher margin projects and the company’s continued intention to invest in market development activities. Iluka Resources profits have been increasing over the past three years.
