South Pac Share and Oil Price Weekly Update

Each week the Blue Swan Daily brings you a snap shot of the key share and oil prices related to all things travel and aviation.

Monthly Share Price Snapshot:

Source: ASK (Prices in AUD)

Key news stories of the week

Qantas Airways

Qantas Group issued (02-May-2018) the following trading update for the three months ended 31-Mar-2018:

  • Revenue: AUD4250 million (USD3340 million), +7.5% year-on-year;
  • Underlying profit before tax: AUD1550 million (USD1218 million) to AUD1600 million (USD1257 million);
  • Passengers: 13.7 million, +3.2%;
    • Qantas domestic: 5.3 million, -0.4%;
    • Qantas international: 2.1 million, +8.9%;
    • Jetstar domestic: 3.5 million, +4.6%;
    • Jetstar international: 1.7 million, +3.7%;
    • Jetstar Asia: 1.1 million, +5.6%;
  • Passenger load factor: 83.2%, +3.1ppt;
    • Qantas domestic: 76.9%, +1.9ppt;
    • Qantas international: 84.0%, +3.4ppt;
    • Jetstar domestic: 86.8%, +3.3ppt;
    • Jetstar international: 86.9%, +3.6ppt;
    • Jetstar Asia: 84.0%, +2.2ppt;
  • Revenue per ASK: +6.0%;
    • Domestic: +8.0%;
    • International: +5.2%.

Qantas began its share buy back, announced at the recent half year results meeting. The carrier plans on completing a AUD378 million (USD297 million) share repurchase allocation. Last week’s buy back included:

  • 30-Apr-2018: 2,763,862 shares for a total consideration of AUD15.8 million (USD11.9 million).
  • 01-May-2018: 1,505,112 shares for a total consideration of AUD8.6 million (USD6.4 million);
  • 04-May-2018: 1,300,000 shares for a total consideration of AUD8.0 million (USD6.0 million).

Qantas has completed AUD200.7 million (USD151 million) of its total repurchase authorisation of AUD378 million (USD284.4 million).

Virgin Australia

Moody’s Investors Service affirmed its B2 corporate family rating and B3 senior unsecured ratings for Virgin Australia Holdings and raised the group’s rating outlook from ‘negative’ to ‘stable’. Moody’s also affirmed the ratings assigned to the company’s Enhanced Equipment Notes (EEN’s), Virgin Australia 2013-1A Trust’s Baa1 rating, Virgin Australia 2013-1B Trust’s Ba2 rating, and Virgin Australia 2013-1C Trust’s B1 rating. The outlook on the EEN ratings is changed from ‘negative’ to ‘stable’. Moody’s stated it believes Virgin Australia can maintain its B2 rating without further improvements in operating cash flow, reductions in capital expenditure, or reliance on shareholder support, following equity raising and balance sheet strengthening in 2017, as well as an improvement in EBITDA, driven by the carrier’s three year turnaround programme launched in Jul-2016.

Oil Prices Update