Qantas posts $211 M half-year loss, cuts 5000 jobs

Associated Press

SYDNEY (AP) — Qantas Airways Ltd. on Thursday posted a first-half loss of 235 million Australian dollars ($211 million) amid tougher competition and announced plans to cut 5,000 jobs.

The statutory loss for the six months through December 2013, followed a AU$111 million ($114 million) profit for the same period a year earlier.

The Australian flag carrier said the 5,000 jobs would be cut as part of its bid to cut AU$2 billion in costs over three years.

Qantas chief executive Alan Joyce said Australia had been "hit by a giant wave of international airline capacity," with a 46 percent increase in competitor capacity since 2009.

"We are facing the toughest conditions Qantas has ever seen," Joyce said in a statement.

The Australian government is considering reducing foreign ownership restrictions legislated in 1992 before the state-owned airline was privatized.

Qantas argues that the 49 percent cap on foreign ownership, 35 percent limit on ownership by foreign airlines and 25 percent cap no ownership by any single foreign investor put it at a disadvantage against state-owned competitors in raising capital.

State-owned Air New Zealand, which has 24.5 percent stake in Qantas' major rival Virgin Australia, posted a record half-year profit of 140 million New Zealand dollars ($116 million) on Thursday.