Qantas tumbles on concern fuel, Plane costs to weigh on profit
24 August, 2018, 1:47 am
SYDNEY,23 AUGUST 2018 (BLOOMBERG) – Qantas Airways Ltd. shares tumbled the most in 10 months on concern rising fuel prices and the cost of aircraft ownership will erode earnings even after the Australian carrier reported record annual profit.
The stock, which had rallied more than 30 percent this year before today’s announcement of results, fell as much as 6.9 percent in Sydney on Thursday.
“The market has looked at that cost inflation and sold the stock down,” said Daniel Mueller, a fund manager at Vertium Asset Management in Sydney. “The market’s concerned about whether they can recover it. The stock’s had a really strong run without any pullback since the beginning of the year. It’s a bit of a reality check.”
The airline said Thursday it will return as much as A$500 million (US$366 million) to shareholders, including a higher-than-expected dividend and another stock buyback. About 27,000 employees were showered with bonuses worth A$67 million (US$48 million).