Welcome to Kalkine TV. I'm Rose Jacobs and you are watching THE BUZZING TRENDS. Today
we will take a look at Qantas Airway’s journey and understand Why its share price
is on the move.
Shares of ASX listed Qantas Airways has been plummeting ever since the company shared
the news to grant a ‘leave of absence’ to around 2,500 employees.
On Tuesday, Australia’s largest airline Qantas stood down around 2,500 employees for a minimum
of two months to cope with the fresh restrictions imposed in Australia to contain the spread
of Coronavirus. Coronavirus cases have been increasing daily in Australia for more
than a month now. With the situation worsening, the government has put stringent restrictions in
place - slashing the domestic travel demand.
Australia’s city of Sydney has been left reeling under Covid 19 pressure With Greater
Sydney going into lockdown for another three-and-a-half weeks.
Shares of ASX listed Qantas Airways have been plummeting ever since the company shared the
news to temporarily stand down around 2,500 frontline Qantas and Jetstar employees, as reported
by the Australian Securities Exchange. The company however expects no long-term job losses.
The latest move is expected to have an impact on domestic pilots, cabin crew and airport
workers, mostly in New South Wales. The airline also said that the employees will be served
two weeks’ notice before the stand-down - with the staff being paid in full for
their notice period, effective now.
The company also informed that disaster payments from the government would assist
employees to face this challenging period.
In addition, Qantas and Jetstar have been operating at less than 40 per cent of their
usual domestic flights in July - down from nearly 100 per cent in May due to lockdowns
in three states. The company was hopeful of domestic flights returning to nearly 50 or
60 per cent of normal levels once other states reopen borders including South Australia and
Victoria - and the current outbreak in Brisbane is deemed to be under control.
Qantas’ shares closed at $4.46 on 5 August 2021, 22.9 percent off from its 52-week
high of $5.79 recorded during the last week of November 2020. However, to understand the real
picture, if you look at historical data from the past twelve months, Qantas’s
share price has in fact edged higher delivering returns of 34.74 percent to investors. It’s
not just Qantas feeling the effects. Several other ASX listed airlines are being impacted during
the recent resurgence of coronavirus cases. To give a clearer picture on the overall airline
industry in Australia, let’s take a look at the airline stock of Regional Express. Rex
as it is also known, announced on Tuesday that it had signed a Letter of Intent with
a lessor for the lease of two Boeing aircrafts. The two aircrafts are expected to arrive in late
August, increasing the airline’s fleet of 737s to eight, and are scheduled to enter service
on their domestic network in September.
As of now, Regional Express is operating 737 services from Melbourne to Sydney, The
Gold Coast, Adelaide, and Canberra and from Sydney to The Gold Coast.
The two additional aircraft will provide the airline with the ability to launch new routes
to other capital cities, as well as large regional centres and popular leisure destinations.
The new routes will be announced shortly. Currently, Regional Express is operating a fleet of 60 Saab
340 and six Boeing 737s aircraft to 61 destinations throughout all states in Australia.
Well, we will talk more on Regional Express and also glance at Alliance Aviation but after
a short break
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Welcome back, I'm Rose Jacobs and you are watching THE BUZZING TRENDS.
Before the break we were discussing the latest updates from popular airline Regional Express.
The airline said the latest COVID-related state border restrictions have severely disrupted their
domestic and regional networks, forcing the company to cancel many flights to and from Melbourne.
The share price of Regional Express gained as much as 16 percent in the last year - as
of last close, it was spotted trading at $ 1.20 per share - The Company is hopeful that
it will finish the Financial Year of 2021 with a breakeven situation.
Next on the list is Alliance Aviation. Its shares were in high demand among the investors
after the release of the half-yearly earnings update in December 2020. The company reported
profit growth on both the higher-margin contract and charter flights, which counterbalanced
weaker wet lease and Recreational Pilot Licence revenues. Even the company’s
operating cash flow is healthy. The robust earnings came at a time when coronavirus pandemic
significantly impacted the sector’s overall business.
Alliance Aviation reported a 2.3 per cent rise in total revenue and a 116.8 per cent
surge in profit before tax for the six months ending 31 December, 2020. The 72 per cent
jump in the underlying profit before tax to $26.7 million was in line with the company’s half-year
guidance.
Similarly, operating cash flow was recorded at A$47.5 million, a 225 per cent rise from
the corresponding period last year. The company’s net debt stood at $6.8 million during the
period.
The shares of Alliance Aviation have jumped 23.6 per cent in the last 12 months. On Thursday, the
stock closed at A$4.45. The year to date returns for the stock stand at 19.62 per
cent.
With that, It’s time to wrap up today’s show. I hope you found today’s show informative
- stay tuned for more news and updates on Kalkine TV Live. I'm Rose Jacobs….thanks for joining
me.