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UPDATE 1-Australia's Qantas says H1 profit more than doubles, announces buyback

Published 23/02/2016, 09:32 am
© Reuters.  UPDATE 1-Australia's Qantas says H1 profit more than doubles, announces buyback
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* Qantas H1 Pre-tax profit A$921 mln vs A$367 mln

* Fuel costs down 21 pct on tumbling oil price

* Company announces second consecutive A$500 mln buyback (Adds CEO quote, buyback details, shares)

SYDNEY, Feb 23 (Reuters) - Australian flagship airline Qantas Airways Ltd QAN.AX said on Tuesday that first-half profit more than doubled, hitting a record, as it cut costs and reaped the benefits of a lower Australian dollar and oil price.

Qantas said underlying profit before tax, the most closely watched measure, was A$921 million for the six months to Dec. 31, up from A$367 million in the first half of the previous year and near the top of guidance it gave in December of between A$875 million and A$925 million.

The company also said it would buy back another A$500 million of its shares on the market, a repeat of the share price supporting measure it took the previous year. It did not declare an interim dividend, the same as the previous year.

The result builds on one of the fastest turnarounds in Australian corporate history as Chief Executive Officer Alan Joyce slashes costs including 5,000 jobs, raises fares and overhauls the airline's frequent flyer programme. record result reflects a stronger, leaner, more agile Qantas," Joyce said in a statement.

A declining oil price LCOc1 has also helped: the company said first-half fuel expenses shrank 21 percent to A$1.7 billion.

Interim pre-tax profit for Qantas International more than quadrupled, to A$270 million from A$59 million, its best result since being reported separately, as a lower Australian dollar AUD=D4 encouraged more inbound tourism.

Qantas Domestic, the biggest earner, grew its pre-tax profit 70 percent as the company continued to resist heavy discounts to take market share from local rivals such as Virgin Australia Ltd VAH.AX .

The turnaround has been reflected in Qantas shares, which closed at A$3.99 on Monday, having traded below A$1.00 in 2013 when a cost blow-out weighed on profits.

Qantas said it would offer no profit guidance, "having regard to industry and economic dynamics".

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