SYDNEY Australia's Qantas Airways (QAN.AX) said it will repay A$650 million in debt ahead of schedule and buy back up to A$100 million in shares as it seeks to boost shareholder returns after a slump in its share price over the past two years.
In September Qantas, which has been battling high fuel costs, tough competition, and a strong Australian dollar that has dented Australian tourism spending, announced plans to tie up with Dubai's Emirates EMIRA.UL to shore up its loss-making international business.
"The Board believes the current Qantas share price does not reflect fair value of the Group, particularly considering the underlying strength of its domestic, loyalty and Jetstar businesses and the proposed partnership with Emirates," Qantas Chairman Leigh Clifford said in statement.
Qantas said it expected to report underlying profit before tax for the six months ending 31 December 2012 in the range of A$180 million to A$230 million, versus A$202 million a year ago.
"The outlook for the second half of FY13 remains volatile and, given the uncertainty in global economic conditions, fuel prices and foreign exchange rates, it is not possible to provide further guidance at this time," Qantas said.
In addition to the planned Emirates alliance, Qantas has been cutting jobs, cancelling plane orders and selling non-core assets to boost its balance sheet and reduce operating costs.
Qantas shares slumped to A$0.96 in June, their lowest since it was privatised in 1995, but have since recovered to A$1.23.
(Reporting by Lincoln Feast; Editing by John Mair)
Trending On Reuters
India's $100 billion push into solar energy over the next decade will be driven by foreign players as uncompetitive local manufacturers fall by the wayside, no longer protected by government restrictions on the sector. Full Article
India's $100 billion solar push draws foreign firms as locals take backseat Full Article