Qantas Airways Limited · ASX:QAN
Qantas Airways — Investor Day (November 2009)
28 slides from Qantas Airways's investor day presentation, Nov 23, 2009
Slide 1: Qantas Investor Day
Qantas Investor Day For personal use only Alan Joyce CEO Qantas Investor Day Overview [ Strategy review [ Meet the Executive Team [ Business updates
Slide 2: The GFC - Decisive Action
The GFC - Decisive Action [ Flying operations [ Capital expenditure For personal use only [ Cash flow [ Cost base [ Management structure Executive Team
Slide 3: Our Goals
Our Goals For personal use only Key Priorities [ Maximising power of two brand strategy [ Improving the international business [ Building on a profit maximising 65% domestic market share [ Optimising portfolio businesses and investments
Slide 4: Qantas Investor Day - CFO Overview
Qantas Investor Day For personal use only Colin Storrie CFO Qantas Overview [ Recap of FY09 financial management [ Sustainable returns to shareholders [ Two brand strategy - getting the balance right [ Capital expenditure [ Financial risk management [ Giving investors more
Slide 5: Recap FY09 - Financial
Recap FY09 - Financial [ Full year profit before tax of $181 million [ Operating cash flow $1.1 billion For personal use only [ Increase in net cash of $1.0 billion to $3.6 billion [ Deferral and cancellation of US$7.9 billion capex1 [ Aircraft funding in place to October 2010 [Investment grade cred
Slide 6: Getting the Balance Right
Getting the Balance Right [ Capacity allocation decisions made at Group level [ Network requirements assessed at flying segment level For personal use only [ Executive short term incentive plans linked to Group performance, not just flying segment [ Capital allocation based on expected returns Capit
Slide 7: Financial Risk Management - FX
Financial Risk Management - FX FOREIGN CURRENCY EXPOSURE Foreign GBP currency net receipts EUR For personal use only NZD JPY Net USD cost base HKD&CNY Other US AUD AUD residual AUD [ Remainder of FY10 operational FX is 70% hedged at a worst case rate of around AUD0.7200 [Half of this hedging is in o
Slide 8: Giving Investors More
Giving Investors More [ More comprehensive information For personal use only [ Qantas Data Book [ QFF information sessions [ Qantas Investor Day Qantas Operations Lyell Strambi Group Executive Qantas Operations
Slide 9: Integrated Airline
Integrated Airline [ Simplified structure For personal use only [ Faster decision making [ Remove duplicate corporate functions [ Focus on costs [ Integrated management Q Future [ Program to position Qantas for profitable growth [ Transformational change [ $1.5bn margin improvement targeted [ 33 ini
Slide 10: Right Aircraft
Right Aircraft d to re ers s t s e iv e Qantas Fleet Renewal rd i gh cha Del O R ur For personal use only P A380-800 20 12 4 B787 25 25 0 A330-200 7 0 6 B737-800 69 30 41 Q400 21 24 16 Customer Service – On Time [ Domestic on time departures – Qantas leads 10 of last 12 Months Nov 08 Dec 08 Jan 09 F
Slide 11: Operational Efficiency
Operational Efficiency [ Aircraft utilisation [ Fleet configuration For personal use only [ Labour supply and productivity [ Facility optimisation QFuture [ Right skill, right place [ Automation [ Strategic sourcing [ Equipment optimisation Safety and Environment Rob Kella Chief Risk Officer
Slide 12: Safety Perceptions
Safety Perceptions Domestic Market - Perception as a Safe Airline For personal use only 89% 79% 81% 85% 76% 83% 74% 82% 83% 66% 70% 63% Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Our First Priority [ Safety policies, systems and procedures reflect this
Slide 13: Environment
Environment [ Strong focus on fuel conservation [ Investing in fuel efficient aircraft For personal use only [ Working with AsA to improve air traffic management [ Involvement in efforts to develop sustainable aviation fuel [ Preparing for carbon trading readiness [ Australian FY09 CO2-e emissions o
Slide 14: Next Generation Premium Airline
Next Generation Premium Airline [ An exceptional baseline experience for all customers [ Extraordinary experience for high value flyers For personal use only [ Recognised advocacy leader [ Excellence in product and service design [ Lower cost to serve [ A strong, profitable growth story Key Strategi
Slide 15: Product and Service Innovation
Product and Service Innovation [ A380, B738 [ First Lounges For personal use only [ Premium Economy [ Airport of the Future [ Connectivity [ Centre of Service Excellence [ eXceptional - customer service training Reconfigurations [ Retention of First cabins on key markets [ Right sizing First and Bus
Slide 16: Qantas Commercial and Freight - Best for Business
Qantas Commercial and Freight For personal use only Rob Gurney Group Executive Qantas Commercial Best for Business [ Network, product, service and brand assets [ Value enhancing partnerships with corporate clients [ Proactive SME acquisition program [ Leading loyalty program [ Premium business facil
Slide 17: Small to Medium Sized Businesses (SME)
Small to Medium Sized Businesses (SME) [ Strong base with opportunity to grow [ Strong suite of products For personal use only [ Customer segmentation insights [ Enhanced customer offering Corporate and Government [ Aggressively competing for share of Corporate & Government Business [ Whole Of Austr
Slide 18: Drive Improvement in Contribution Margin
Drive Improvement in Contribution Margin [ Leverage strong channel management [ Transition of direct channels into profit centres For personal use only [ Maximise ancillary revenue and cost recovery opportunities [ Strategic alignment with distribution partners qantas.com [ Developing an integrated
Slide 19: Qantas Yield per ASK Performance
Qantas Yield per ASK Performance [ Qantas September Quarter yield performance -10.9% British Airways For personal use only -12.4% Qantas Group -13.4% Qantas -13.8% Lufthansa -14.5% American Airlines -14.7% United Airlines -23.0% Singapore Airlines Period = Jul-Sep09, except for BA (Apr-Sep09) Based
Slide 20: International Competition
International Competition Qantas Capacity VLY Other Carriers Capacity VLY Qantas Seat Factor VLY Other Carriers Seat Factor VLY +4.1 Prudent capacity management For personal use only Improved Qantas seat factor +2.1 +1.9 +1.5 +1.2 0.6 10 8 11 7 7 -12 -13 -14 -14 -17 -2.5 -2.8 -2.9 Mixed policies and
Slide 21: International Network Competitive Environment
International Network Competitive Environment [ UK/Europe [ USA For personal use only [ Asia Domestic [ Effective deployment of two brand strategy to defend share [ Virgin Blue reduced capacity SYD/MEL [ Network growth opportunities as demand returns [ Well placed for economic recovery
Slide 22: Qantas Freight Enterprises
Qantas Freight Enterprises [ Structure [ Managing through the downturn For personal use only [ Maximising returns from core assets [ Freight environment Structure QantasFreight Qantas Freight Enterprises Enterprise s Air Air International International Domestic Domestic Freight Freight Express Expre
Slide 23: Managing Through the Downturn
Managing Through the Downturn [ Focus on maximising value from existing assets [ Key management priorities For personal use only [ Growing international bellyspace revenue [ Improving B747 freighter margins Maximising Returns from Core Assets [ Long term freight footprint aimed at ensuring optimal r
Slide 24: Freight Environment
Freight Environment [ Increasing activity noted since start of financial year [ Demand for ad hoc freighter work For personal use only [ RFTKs however remain below last year to date [ Yield improvement remains challenging however progressing positively [ Joint Ventures (AaE & STE) performing ahead o
Slide 25: The Qantas Two Brand Strategy
The Qantas Two Brand Strategy [ Qantas - Best premium airline [ Jetstar - Best low fares airline For personal use only [ Low fares leadership [ Continual cost reduction [ Building hassle-free product and service offering [ Continued innovation through technology [ Growth in ancillary revenue streams
Slide 26: Growth in Australian Domestic Market
Growth in Australian Domestic Market [ 8.1 million domestic passengers in FY09 [ 17.4% market share1 in FY09 up from 15.2% in FY08 For personal use only 8 new Jetstar routes launched in 2009 1. By ASK Successful Expansion in Japan and NZ [ Transfer of Japan routes generated significant PBT turnaroun
Slide 27: Growth in Asia
Growth in Asia [ Alignment between Jetstar and Jetstar Asia – important foundation [ Operating synergies of SGD20m per annum For personal use only [ 19 destinations ex-Singapore [ Significant achievements in Jetstar Pacific [ 34% growth in passenger numbers year-to-date [ Costs reduced by 29% [ Incr
Slide 28: Fleet Growth
Fleet Growth [ A320 family deliveries advanced to provide FY10 growth [ 3 incremental aircraft for Singapore business For personal use only [ 4 incremental aircraft for Australian/New Zealand businesses [ 2 new aircraft to replace existing older aircraft [ 4 to 5 additional A330-200s for Jetstar Int