The Qantas Airways Limited (ASX: QAN) share price has slipped 0.42% in Friday afternoon trade.
Shares in the iconic Australian airline are currently trading at $5.93 after touching an intraday high of $5.99 around midday.
The industrials sector, which Qantas is part of, is having a bit of a rough end to the week. The S&P/ASX 200 Industrials Index (ASX: XNJ) is down 0.52% at the time of writing.
In light of Qantas share price movement recently, the question on people’s minds might be, does it have the altitude to move much higher?
Qantas executives seem to think so, at least according to comments addressed to shareholders at its 2022 annual general meeting today.
Let’s cover the highlights of what they said.
Qantas expects earnings rebound
Qantas CEO Alan Joyce and chairman Richard Goyder painted a bullish picture of where Qantas could be headed in the future.
In his address, Goyder said the airline was on the path to recovery after incurring a $7 billion earnings loss and losing $25 billion in revenue over a two-and-a-half-year period.
Looking ahead, Goyder believes that Qantas will be profitable in the first half of 2023, with an anticipated profit of between $1.2 and $1.3 billion.
Joyce supported a Qantas recovery trajectory, saying its “operations have reached, or are quickly reaching pre-COVID levels of service”. He added that it’s also expanding its operations through additional routes and aircraft.
Travel was said to have rebounded for both international and domestic routes, with leisure bookings up 130 per cent pre-COVID and business travel up more than 100 per cent.
Joyce concluded his commentary on its economic recovery by stating that Qantas had increased its market share across various segments, including corporate, SME, and international travel.
One fund agrees with the pair’s assessment that the Qantas share price could be on the rebound.
Fund manager believes the airline is a buy
Alphinity Australian portfolio manager Stuart Welch singled out Qantas as a buy, as the Fool reported this morning.
Welch praised Qantas’s strong earnings growth, and mirrored comments made by the Qantas pair that travel demand has seen an incredibly strong rebound.
Welch said:
Weâve seen very strong demand for both domestic and international travel, at this point running 120%+ relative to pre-COVID levels.
My colleague Tony notes that the airline’s shares are up 42% since finding a low during mid-July, so perhaps there’s still some momentum left in the rally as further pent-up demand for travel is released in the future.
Qantas wins award for poor customer service
On the other hand, recent tales of poor management and customer service at Qantas may encourage flyers to choose a different airline in the future.
The experiences of disappointed customers were so bad that consumer advocacy group Choice recently gave Qantas an award for it, ABC News reported yesterday.
The article said Qantas earned the ‘Shonky’ award because it “failed to give Australian consumers a fair deal.” The airline’s customers experienced service issues that included “lost luggage, long call wait times, and cancelled flights”.
Explaining why Qantas deserved to be called out for its customer service failures, Choice CEO Alan Kirkland commented:
Qantas might call itself the Spirit of Australia, but we think Spirit of Disappointment is more appropriate. It is well and truly deserving of receiving a Shonky Award this year.
People are still paying premium prices to fly Qantas, but itâs clear from the complaints weâve heard, theyâre not getting a premium service.
A Qantas spokeswoman responded, saying Qantas wasnât the only airline that struggled due to COVID-19 and border closures:
Our customers have redeemed more than $1 billion in COVID-related flight credits. The conditions for these are the same, or better, than they were pre-COVID and weâre actively encouraging our customers to use them.
No one is disputing the fact we had issues earlier this year, and we apologised for that, but itâs disappointing that Choice failed to acknowledge the impact that COVID and border closures have had on the entire aviation industry.
