Qantas 2015 Annual Report Download - page 21

Download and view the complete annual report

Please find page 21 of the 2015 Qantas annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 106

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106

20
QANTAS ANNUAL REPORT 2015
RECONCILIATION OF UNDERLYING PBT TO STATUTORY PROFIT/(LOSS) BEFORE TAX
The Statutory Profit Before Tax of $789 million for the year ended 30 June 2015 is $4,765 million higher than the prior year.
Underlying PBT
Underlying PBT is the primary reporting measure used by the Qantas Group’s chief operating decision-making bodies, being the
Chief Executive Officer, Group Management Committee and the Board of Directors, for the purpose of assessing the performance of
the Group. The primary reporting measure of the Qantas International, Qantas Domestic, Jetstar Group, Qantas Loyalty and Qantas
Freight operating segments is Underlying EBIT. The primary reporting measure of the Corporate segment is Underlying PBT as net
finance costs are managed centrally.
Underlying PBT is derived by adjusting Statutory Profit/(Loss) Before Tax for the impacts of ineffectiveness and non-designated
derivatives relating to other reporting periods and certain other items which are not included in Underlying PBT.
Reconciliation of Underlying PBT to Statutory Profit/(Loss) Before Tax
June
2015
$M
June
2014
$M
Underlying PBT 975 (646)
Ineffectiveness and non-designated derivatives relating to other reporting periods (39) 72
Other items not included in Underlying PBT
– Impairment of Qantas International CGU –(2,560)
– Redundancies, restructuring and other transformation costs (80) (428)
– Fleet restructuring costs56 (4) (394)
– Net impairment of other intangible assets (7) (9)
– Net gain on sale of controlled entity and related assets 11 62
– Net impairment of investments (19) (50)
– B787–8 introduction costs –(14)
– Write-off of Jetstar Hong Kong Business57 (21) –
– Other (27) (9)
Total other items not included in Underlying PBT (147) (3,402)
Statutory Profit/(Loss) Before Tax 789 (3,976)
Ineffectiveness and non-designated derivatives relating to other reporting periods
In prior reporting periods, Underlying PBT was adjusted for the impacts of AASB 139 which relate to other reporting periods. The
AASB 139 adjustments to Statutory Profit/(Loss) Before Tax ensured derivative mark-to-market movements that relate to underlying
exposures in other reporting periods were recognised in Underlying PBT in those reporting periods.
In the current reporting period, as a result of the early adoption of AASB 9 (2013), there is now better alignment between Underlying
PBT and Statutory Profit/(Loss) Before Tax. However, there will continue to be a difference between Statutory Profit/(Loss) Before Tax
and Underlying PBT resulting from derivative mark-to-market movements being recognised in the Consolidated Income Statement in
a different period to the underlying exposure.
Other items not included in Underlying PBT
Items which are identified by Management and reported to the chief operating decision-making bodies as not representing the
underlying performance of the business are not included in Underlying PBT. The determination of these items is made after
consideration of their nature and materiality and is applied consistently from period to period.
Items not included in Underlying PBT primarily result from revenues or expenses relating to business activities in other reporting
periods, major transformational/restructuring initiatives, transactions involving investments and impairments of assets and other
transactions outside the ordinary course of business.
Redundancy, restructuring and other transformation costs of $80 million were incurred during the period.
A write-off of the Jetstar Hong Kong business of $21 million was recognised as a result of the Hong Kong’s Air Transport Licensing
Authority’s rejection of Jetstar Hong Kong’s licence application.
REVIEW OF OPERATIONS CONTINUED
FOR THE YEAR ENDED 30 JUNE 2015
56 Fleet restructuring costs include impairment of aircraft, together with other aircraft associated property, plant and equipment, inventory and other related costs
57 The write-off of the Jetstar Hong Kong business includes the impairment of the investment, write-off of deferred costs and the Group’s share of net losses for the year ended 30 June 2015