Government and Opposition Optimistic Despite Qantas' 2.8 Billion Dollar Loss
Qantas loss this fiscal year was big: $2.8 billion big. It is the largest loss the former state-owned airline has posted in its 94-year history. Although some say the results were expected, the size of the loss still comes as a surprise to many, considering the company made $930 million profit the previous year.
There are several contributing factors to the large loss. The result was driven in part by the cumulative impact of two years of industry capacity growth ahead of demand. This led to a $566 million decline this financial year’s revenue. Fuel costs in Australia are also up, costing the company $253 million over 2013’s prices. According to their press release, Qanta’s “non-cash fleet write down post-structural review” can be blamed for the biggest chunk of the loss: $2.6 billion.
Qantas’ recovery plan has already been in place for months. The company created a stir when it announced 5,000 redundant positions would be dissolved. So far, half of that goal has been met. According to the report, Qantas also plans on driving an earnings recovery and is separating its domestic and troubled international businesses in the hopes that a recovery will shape a profitable future and “build long-term shareholder value.
Current chief executive Alan Joyce commented not on the past, but the future of the company.
“There is no doubt today’s numbers are confronting, but they represent the year that is past,”Joyce said. “We have now come through the worst. With our accelerated Qantas Transformation program we are already emerging as a leaner, more focused and more sustainable Qantas Group. There is a clear and significant easing of both international and domestic capacity growth, which will stabilise the revenue environment. We expect a rapid improvement in the Group’s financial performance – and a return to Underlying PBT profit in the first half of FY15, subject to factors outside our control.”
Both the federal government and the opposition believe the company has the opportunity for a strong future despite this year’s fiscal results.
"It is important for Australia that Qantas is a successful company," Labor transport spokesman Anthony Albanese said. “We want that to occur and the government should play its role in facilitating that."
Warren Truss, Deputy Prime Minister, believes that Joyce’s projected return to profit for the first half of 2015 is plausible.
"I think their determination to reduce costs and retire debt, and that they have the capacity to retire debt, will be encouraging to their investors," Truss said. "While the numbers are dramatic, the reality is Qantas is a strong company and seems to be positioning itself for a better future.”
Timeline: India takes unicorn leap with six in five days
We chart an historic week in India’s tech industry, where in just five days, between 5-9 April 2021, the country achieved six new unicorns, bringing India’s total to 10 in 2021 to date, an immense unicorn leap from just seven in 2020 and six in 2019.
April 5: Meesho
India’s first social commerce unicorn, Meesho raised US$300m from SoftBank, Facebook and Shunwei Capital, giving the Bangalore-based startup a US$2.1bn valuation, a threefold jump from its previous funding round in 2019. Founded in 2015 by two IIT-Delhi graduates, Meesho connects producers and resellers, helping small businesses sell through social media. It has 45m customers and has enabled 13m entrepreneurs to start their online businesses with no investment.
April 6: CRED
Founded just over two years ago, Bangalore-based credit card repayment app CRED raised US$215m from Falcon Edge Capital and Coatue, nearly trebling its valuation to US$2.2bn from its January US$80m round. Allowing customers to pay off their credit card debt while earning CRED coins which they cash in for rewards, CRED has grown rapidly during COVID-19, doubling its customer base to nearly 6 million in a year.
April 7: API Holdings / Groww
The first epharmacy startup to gain unicorn status, PharmEasy (API Holdings), which has digitised 60,000 brick and mortar pharmacies and 400 doctors across India, raised US$350m in a round led by Prosus Ventures. Founded by four former Flipkart employees as a way of making investing simple, investment platform Groww became India’s second-youngest fintech unicorn, raising US$83m in Series D funding led by Tiger Global, quadrupling its previous round in September.
April 8: ShareChat
New Delhi-grown social media startup ShareChat, founded in 2016 by Mohalla Tech raised US$502m from Lightspeed Ventures, Tiger Global, Twitter and Snap taking its raised total over six rounds to US$766m and pushing its valuation to US$2.1bn. The funding will be used to grow its user base and short video platform Moj, which launched in 2020 following TikTok’s ban in India. The regional language startup claims 280m users.
April 9: Gupshup
AI-led conversational message startup joined the unicorn club after raising US$100m from Tiger Global giving it a ten-fold valuation of US$1.4bn. The smart messaging platform, which has seen accelerated growth during the pandemic, was founded in Bangalore in 2005 by serial entrepreneur Beerud Sheth, whose online freelancing platform Elance is now listed. Gupshup’s API enables 100,000+ businesses to build messaging and conversation experiences across 30+ communication channels.