Frustrated Qantas shareholders can finally look forward to dividends again as the airline forges ahead with a turnaround plan for its loss-making international arm.
Chairman Leigh Clifford told shareholders at Qantas’ annual general meeting the airline, which last paid a dividend in April 2009, was serious about resuming the payments.
“We will resume dividends at the earliest opportunity,” he said on Friday.
Qantas’ last dividend was for the first half of 2008/09, when it gave shareholders six cents per share, fully franked.
But then the global financial crisis hit, prompting Qantas to suspended dividends and preserve capital for buying 120 new aircraft.
Qantas then went on to post a $245 million loss for 2011/2012, a sharp downturn from net profit of $250 million the prior year, due to high fuel prices and a struggling international division.
It was also hit by one-off costs such as chief executive Alan Joyce’s decision to ground the fleet as part a dispute with unions, which cost $194 million, and restructuring costs for the loss-making international arm.
“We recognise this has been a difficult period for shareholders,” Mr Clifford said.
“However, the significant steps taken over the past 12 months have been consistent with the group’s goal of building long-term shareholder value.”
Exactly a year on from the unprecedented grounding of the fleet, Mr Clifford said the airline was positioned for a strong and sustainable future.
He flagged a return to profitability, but did not give any indication as to when that might be.
Mr Clifford said major steps had been taken in the past year to restructure Qantas’s struggling international operations, including a proposed 10-year partnership with Dubai-based Emirates that was currently before the competition regulator.
The Transport Workers’ Union (TWU) described the past year as nothing short of a disaster for Qantas, given the airline’s first full year loss since privatisation and a 17 per cent fall in the share price.
“This board and this management regime have not treated the workers with respect and you have seen the results of the past year,” TWU official Klaus Pinkas told reporters.
The TWU said the airline group had cut 2800 jobs in the 12 months since the 2011 AGM, however Qantas disputed the figure.
The jobs were cut over a number of years and included voluntary redundancies, as well as pilots choosing to take unpaid leave to go work for other airlines, a spokesman said.
Mr Joyce said the airline’s branding and levels of customer satisfaction had recovered to above levels before the 2011 grounding, adding that staff were behind management.
“The vast majority of Qantas employees are engaged and believe in where we are headed as an organisation and what we need to do to get there,” he said.
“It has been a challenging period, but a pivotal one in Qantas Group’s recent history.”
However one shareholder told Mr Joyce she took the precaution to drive from Sydney to Canberra for the meeting, “just in case you pulled any more of your stunts”, referring to last year’s grounding.
“You have actually destroyed the international brand,” she added.
Shareholders overwhelmingly approved the awarding of long-term performance rights to Mr Joyce, as well as the remuneration report, with 98 per cent voting in favour.
Qantas shares closed half a cent higher at $1.295.
