Qantas 2016 Annual Report Download

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WSJC
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New Horizons
QANTAS ANNUAL REPORT 2016

Table of contents

  • Page 1
    VVVV VYTF ZISA VVTS VTBB WBKK WSJC WABB H 540 500 500 450 New Horizons Q A N TA S A N N U A L R E P O R T 2 016

  • Page 2

  • Page 3
    ... 2016 Contents Qantas Annual Report 2016 Our Performance in 2015/16 Our Financial Framework Chairman's Report CEO's Report Board of Directors Review of Operations Corporate Governance Statement Directors' Report Financial Report Shareholder Information Financial Calendar and Additional Information...

  • Page 4
    ... fuel prices - was another driver. The Group's financial position was strengthened during the year, with $2.8 billion in operating cash ï¬,ow used for capital expenditure, shareholder distributions and debt repayments, and excess cash used for refinancing aircraft. Qantas' strong balance sheet and...

  • Page 5
    ...of capital, increased ï¬,eet utilisation, and ongoing business transformation all contributed to achieving greater returns from the Group's existing assets. Qantas Transformation The Qantas Transformation program has unlocked total cost and revenue benefits of $1.66 billion since 2013/14 - including...

  • Page 6
    ... the Group's balanced portfolio of businesses and brands showed its value in a complex market. The Group's domestic two-brand strategy has proven resilient throughout Australia's economic transition, and that continued in 2015/16 with record domestic earnings. In the international market, Qantas and...

  • Page 7
    .... Internationally, growth in our key Asia-Pacific trading partners is healthy, and Asia will be an engine room of air travel demand and Qantas Group growth for decades to come. The UK Brexit decision had little direct impact on the Group, but did create short-term volatility in global markets...

  • Page 8
    ... well-balanced Group strategy, transformation means we're resilient enough to perform in all market conditions and outperform many of our peers. But of course, our environment isn't going to stop evolving. We need to keep controlling our costs and being open to new ways of doing business. Long-Term...

  • Page 9
    ...2016 Every part of the Group contributed to our record result in 2015/16. Role of the National Carrier The role of the national carrier is core to Qantas' identity. It's what sets our brand apart from every other airline serving Australia, and it's why we continue to invest in promoting Australian...

  • Page 10
    ... appointed Chief Executive Officer and Managing Director of Qantas in November 2008. He is a Member of the Safety, Health, Environment and Security Committee. Mr Joyce is a Director of the Business Council of Australia and a Member of the International Air Transport Association's Board of Governors...

  • Page 11
    ... Service from 2011 to 2016. Between 2004 and 2010, Ms Hey was Managing Director of various Ericsson entities in Australia and New Zealand, the United Kingdom and Ireland, and the Middle East. Her executive career with Ericsson spanned more than 20 years in which she held finance, marketing, sales...

  • Page 12
    ...) Independent Non-Executive Director Michael L'Estrange was appointed to the Qantas Board in April 2016. He is a Member of the Safety, Health, Environment and Security Committee. Mr L'Estrange was Head of the National Security College at the Australian National University from 2009 to 2015. Prior to...

  • Page 13
    ...year ended 30 June 2016 TODD SAMPSON MBA, BA(Hons) Independent Non-Executive Director Todd Sampson was appointed to the Qantas Board in February 2015. He is a Member of the Remuneration Committee. He has been the Executive Chairman of the Leo Burnett Group since September 2015, having been National...

  • Page 14
    ... by using cash in excess of short-term requirements to refinance operating leases $1 billion returned to shareholders in 2015/16 through a capital return and on-market share buy-back $500 million in additional capital management initiatives announced including resumption of dividend payments with...

  • Page 15
    ... Shareholder Returns within the top quartile of the ASX100 and global listed airline peer group as stated in the 2015 Annual Report, with reference to the 2015-2017 Long Term Incentive Plan (LTIP). 12 Weighted Average Cost of Capital (WACC) is calculated on a pre-tax basis. 13 Earnings per share...

  • Page 16
    ... to shareholders in 2015/16 through a share buy-back and capital return $778 million cash in excess of short-term liquidity requirements was used to refinance 29 aircraft out of maturing operating leases. Using the Group's existing cash balance in this way achieved the following benefits: - Reduced...

  • Page 17
    ... revenue performance was supported by network changes and capacity management which led to increased fleet utilisation. A reduction in the Group's fuel expense resulted from lower AUD fuel prices and fuel efficiency measures in the Qantas Transformation Program. Group Underlying Income Statement...

  • Page 18
    ... 2016, the Group announced a non-executive bonus payment of $3,000 for full-time and $2,500 for part-time employees, subject to the employee group having signed up to the 18-month wages freeze. 23 Target assumes steady foreign exchange rates and capacity. 24 Includes underlying operating expenses...

  • Page 19
    ...A N TA S A NNUA L REPOR T 2016 Review of Operations continued For the year ended 30 June 2016 BUILDING ON THE GROUP'S LONG-TERM COMPETITIVE ADVANTAGES The Qantas Group's integrated portfolio strategy is designed to diversify earnings and mitigate risk, with the dual brands of Qantas and Jetstar and...

  • Page 20
    ...three aircraft from service in 2015/16 including two lease returns. These included two A330-200s and one B747-400. The Qantas Group's scheduled passenger fleet average age is now 8.6 years36, within the targeted 8-10 year range. The benefits of fleet investment include improved customer satisfaction...

  • Page 21
    ... to shift aircraft to higher-growth markets. Resource-related passenger revenue was down $121 million41 in the year, not including a reduction in charter activity. Qantas Domestic saw strong improvement in all key operational metrics including: - - - - Record on-time performance increasing to 89...

  • Page 22
    ... 2015, and is calculated as Underlying expenses less fuel, adjusted for changes in foreign exchange rates, share of net profit/(loss) of investments accounted for under the equity method, charter revenue and changes in sector length per ASK. 51 Includes Jetstar Asia (Singapore), Jetstar Japan...

  • Page 23
    ... consecutive year of double-digit earnings growth52. Diversifying the Group's non-cyclical earnings at Qantas Loyalty remains a key pillar of the Group's long-term strategy. Highlights in 2015/16 included: - - - - - Revenue up 6.7 per cent; strong margins maintained 3.8 per cent growth in Qantas...

  • Page 24
    ... 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...

  • Page 25
    ... the Qantas Transformation Program with the objective of achieving a cost base comparable to direct competitors. • The Australian domestic aviation market is a highly competitive environment. The Qantas Group's market-leading domestic position and dual-brand strategy allow Qantas to effectively...

  • Page 26
    ... Policies, including the Qantas Group Code of Conduct and Ethics, are detailed in the Qantas Group Business Practices document. This framework is supported by a rigorous whistleblower program, which provides a protected disclosure process for employees. The Qantas Group Employee Share Trading Policy...

  • Page 27
    ... Qantas Group and for ensuring the Qantas Group has an appropriate corporate governance structure. Within that overall strategy, Management has designed and implemented a risk management and internal control system to manage Qantas' material business risks. During 2015/2016, the two Board committees...

  • Page 28
    ... Qantas Group's operations, results of those operations or state of affairs in future years. DIRECTORS' MEETINGS The number of Directors' Meetings held (including Meetings of Committees of Directors) during 2015/2016 is as follows: Safety, Health, Environment and Security Committee1 Qantas Board...

  • Page 29
    ... Multiplex SITES Trust, which is a listed Australian registered managed investment scheme. QUALIFICATIONS AND EXPERIENCE OF EACH PERSON WHO IS A COMPANY SECRETARY OF QANTAS AS AT 30 JUNE 2016 Andrew John Finch Appointed as Company Secretary on 31 March 2014 Joined Qantas on 1 November 2012 2002 to...

  • Page 30
    ... 1 100 per cent of the 2014-2016 Long Term Incentive Plan Rights awarded to Mr Joyce on 18 October 2013 vested and converted to 2,151,000 shares following the performance hurdle testing conducted as at 30 June 2016. 2 Shareholders approved the award of these Rights on 24 October 2014. Performance...

  • Page 31
    ... 2016: Number of Rights Name Testing Period Grant Date Value at Grant Date 2016 Net Vested 2016 Unvested 2016 Total 2015 Net Vested 2015 Unvested 2015 Total 2005 Performance Rights Plan 2006 Performance Rights Plan 2013-2015 Long Term Incentive Plan 2013-2015 Long Term Incentive Plan 2014-2016 Long...

  • Page 32
    ...includes further detail of the Board's assessment of the CEO and Executive Management's contribution to these results. Long Term Incentive Outcomes: Under the 2014-2016 LTIP, a fixed number of Rights were awarded to the CEO and Executive Management in 2013. Based on Qantas' Total Shareholder Return...

  • Page 33
    ... of the 2014-2016 LTIP, 2015-2017 LTIP and 2016-2018 LTIP are the relative Total Shareholder Return (TSR) performance of Qantas compared to: - companies with ordinary shares included in the S&P/ ASX 100 (ASX100) - an airline peer group (Global Listed Airlines) 2015/16 STIP awards paid with a STIP...

  • Page 34
    ... market data including comparable roles in other listed Australian companies and international airlines. Annual Incentive - 2015/16 STIP Outcome In determining outcomes under the STIP, the Board assesses performance against financial, safety and other key business measures as part of a balanced...

  • Page 35
    ...deferred shares worth $1,632,000 with a two year restriction period. More detail on the 2015/16 STIP is provided on pages 37 to 42. Long Term Incentive - 2014-2016 LTIP Outcome At the 2013 Annual General Meeting (AGM), shareholders approved an award of 2,151,000 Rights to the CEO under the 2014-2016...

  • Page 36
    ... Committee is specifically concerned with ensuring that its approach will: - Motivate the CEO, Executive Management and the broader Executive team to pursue the long-term growth and success of Qantas - Demonstrate a clear relationship between pay and performance - Ensure an appropriate balance...

  • Page 37
    ... full value of STIP awards made to each Executive during each of the 2015/2016 and 2014/2015 financial years. LTIP awards vested in 2015/2016 at 100 per cent. LTIP awards vested in 2014/2015 at 85 per cent. The number of Rights vested multiplied by the Qantas share price at 1 July 2013, as the start...

  • Page 38
    ... Payments Deferred Shares PostNon-cash employment 1,3 Benefits Benefits 4 Other Long-term Benefits5 Other Benefits Current Executives Rights Sub-total Sub-total Total Alan Joyce2 Chief Executive Officer Tino La Spina6 Chief Financial Officer Andrew David6 CEO Qantas Domestic Gareth Evans...

  • Page 39
    ...number of Rights vested multiplied by the Qantas share price at the start of the performance period (1 July 2013). The number of Rights vested multiplied by the increase in the Qantas share price over the three year performance period ended 30 June 2016. 7) EXECUTIVE REMUNERATION STRUCTURE Base Pay...

  • Page 40
    ... measures, of relative TSR of Qantas compared to companies in the ASX100 and Global Listed Airlines, remains the most appropriate measure. The current LTIP performance measures are aligned to the Qantas Group's Financial Framework which also targets total shareholder returns in the top quartile of...

  • Page 41
    ... of Qantas' key markets, full-service and value-based airlines and the level of government involvement. For the 2014-2016 LTIP and 2015-2017 LTIP, the Global Listed Airlines peer group includes: Air Asia, Air France/KLM, Air New Zealand, All Nippon Airways, International Airlines Group, Cathay...

  • Page 42
    ... the start of the performance period. The 'LTIP share price growth' amount is equal to the number of Rights vested multiplied by the increase in the Qantas share price over the three year performance period (rather than amortising the accounting value over the relevant performance and service period...

  • Page 43
    ... growth opportunities. Qantas Loyalty achieved its Earnings Before Interest and Tax (EBIT) growth target for 2015/2016. Earnings targets for the two key Jetstar Airlines in Asia, Jetstar Asia and Jetstar Japan were exceeded. Qantas Revenue Management System key project milestones and review benefits...

  • Page 44
    ...' Available Seat Kilometres (ASK). Net underlying expenditure is derived from passenger revenue less Underlying EBIT. For Jetstar Group, unit cost performance is measured as controllable unit cost, which is calculated as total expenses (excluding fuel and costs associated with minority investments...

  • Page 45
    ... of the Qantas Revenue Management System project, targets were set around project milestones and realising project benefits. Summary of Key Contract Terms as at 30 June 2016 Contract Details Alan Joyce Tino La Spina Andrew David Gareth Evans Lesley Grant Jayne Hrdlicka REMUNERATION REPORT (AUDITED...

  • Page 46
    ... the securities of any Qantas Group listed entity) at any time Remuneration Mix The Base Pay and 'At Target' STIP and LTIP opportunities are set with reference to external benchmark market data including comparable roles in other listed Australian companies and international airlines. The 'At Target...

  • Page 47
    ...'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. Statutory Profit After Tax for 2015/2016 was $1,029 million (2015: $560 million, 2014: ($2.8) billion, 2013...

  • Page 48
    ... and return of capital to shareholders paid on 6 November 2015 did not apply to Rights granted under the LTIP. 2 The 30 June 2016 balance includes the Rights granted under the 2014-2016 LTIP which vested at 100 per cent and converted into shares following the performance hurdle testing conducted as...

  • Page 49
    ... hours to attend Board and Committee Meetings or Board-related activities requiring participation of all Directors. All Non-Executive Directors and eligible beneficiaries receive travel entitlements. The Chairman is entitled to four long haul trips and 12 short haul trips each calendar year and all...

  • Page 50
    ...2016 Directors' Report continued For the year ended 30 June 2016 REMUNERATION REPORT (AUDITED) CON TINUED Remuneration for 2015/2016 - Non-Executive Directors Short-term Employee Benefits Base Pay (Cash) Non-cash Benefits Post-employment Benefits Travel Sub-total Total Sub-total Superannuation...

  • Page 51
    ...an officer of Qantas. The Directors and the Company Secretaries listed on page 27 and individuals who formerly held any of these positions have the benefit of the indemnity in the Qantas Constitution. Members of Qantas' Executive Management team and certain former members of the Executive Management...

  • Page 52
    ... International"), a Swiss entity. Limited liability by a scheme approved under Professional Standards Legislation Rounding Qantas is a company of a kind referred to in Australian Securities and Investments Commission (ASIC) Corporations (Rounding in Financial/Directors' Reports) Instrument 2016...

  • Page 53
    ... Tax, Operating Segments and Return on Invested Capital 2 Revenue and Other Income 3 Other Expenditure 4 Net Finance Costs 5 Income Tax 6 Dividends and Other Shareholder Distributions 7 Auditor's Remuneration 8 Cash and Cash Equivalents 9 Receivables 10 Assets Classified as Held for Sale 11 Property...

  • Page 54
    ... TA S A NNUA L REPOR T 2016 Consolidated Income Statement For the year ended 30 June 2016 Notes 2016 $M 2015 $M REVENUE AND OTHER INCOME Net passenger revenue Net freight revenue Other Revenue and other income EXPENDITURE Manpower and staff related Fuel Aircraft operating variable Depreciation and...

  • Page 55
    ... Statement, net of tax1 Recognition of effective cash flow hedges on capitalised assets, net of tax Net changes in hedge reserve for time value of options, net of tax Foreign currency translation of controlled entities Foreign currency translation of investments accounted for under the equity method...

  • Page 56
    ... Other financial liabilities Provisions Total non-current liabilities Total liabilities Net assets EQUITY Issued capital Treasury shares Reserves Retained earnings Equity attributable to the members of Qantas Non-controlling interests Total equity The above Consolidated Balance Sheet should...

  • Page 57
    ... effective cash flow hedges on capitalised assets, net of tax Net changes in hedge reserve for time value of options, net of tax Defined benefit actuarial losses, net of tax Foreign currency translation of controlled entities Foreign currency translation of investments accounted for under the equity...

  • Page 58
    ... controlling Earnings Interests 30 June 2015 $M Issued Capital Total Equity Balance as at 1 July 2014 TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR Statutory profit for the year Other comprehensive income/(loss) Effective portion of changes in fair value of cash flow hedges, net of tax...

  • Page 59
    ...T 2016 Consolidated Cash Flow Statement For the year ended 30 June 2016 Notes 2016 $M 2015 $M CASH FLOWS FROM OPERATING ACTIVITIES Cash receipts from customers Cash payments to suppliers and employees (excluding cash payments to employees for wage freeze bonus, redundancies and related costs) Cash...

  • Page 60
    ...-designated derivatives relating to other reporting periods 1,532 (15) 975 (39) Other items not included in Underlying PBT - Transformation costs - Wage freeze employee bonus - Net gain on sale of controlled entity and related assets - Net gain on sale of property, plant and equipment - Other Total...

  • Page 61
    ...the Financial Statements continued For the year ended 30 June 2016 1 UNDERLYING PROFIT BEFORE TAX, OPERATING SEGMENTS AND RETURN ON INVESTED CAPITAL CON TINUED ii. Other Items Not Included in Underlying PBT Items which are identified by Management and reported to the chief operating decision-making...

  • Page 62
    ... year ended 30 June 2016 1 UNDERLYING PROFIT BEFORE TAX, OPERATING SEGMENTS AND RETURN ON INVESTED CAPITAL CON TINUED 2016 $M Qantas Qantas Domestic International Qantas Freight Jetstar Group Qantas Loyalty Corporate Unallocated/ Eliminations2 Consolidated REVENUE AND OTHER INCOME External segment...

  • Page 63
    ... the Financial Statements continued For the year ended 30 June 2016 1 UNDERLYING PROFIT BEFORE TAX, OPERATING SEGMENTS AND RETURN ON INVESTED CAPITAL CON TINUED The objective of this adjustment is to show an EBIT result which is indifferent to the financing or ownership structure of aircraft assets...

  • Page 64
    ... hire Non-aircraft operating lease rentals Property Marketing and advertising Employee related benefit discount rate and other assumption changes Wage freeze employee bonus Redundancies Inventory write-off Net impairment of property, plant, equipment, intangible assets and investments Contract work...

  • Page 65
    ...TA S A NNUA L REPOR T 2016 Notes to the Financial Statements continued For the year ended 30 June 2016 4 NET FINANCE COSTS 2016 $M 2015 $M FINANCE INCOME Interest income on financial assets measured at amortised cost Interest income from investments accounted for under the equity method Unwind of...

  • Page 66
    ... property, plant and equipment Write-down of investments Other net non-assessable/(non-deductible) items (Under)/over provision from prior periods Income tax expense RECOGNISED IN THE CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Cash flow hedges Defined benefit actuarial (losses)/gains Income tax...

  • Page 67
    ... the dividend totalling $134 million above, the directors have announced an on-market share buy-back of up to $366 million. Shareholder approval will be sought at the Annual General Meeting on 21 October 2016 to buy back more than 10 per cent of shares on issue within a 12 month period. In line with...

  • Page 68
    ... convertible to a known amount of cash and are subject to an insignificant risk of change in value. Short-term money market securities of $72 million (2015: $81 million) held by the Qantas Group are pledged as collateral under the terms of certain operational financing facilities when underlying...

  • Page 69
    ...transfers from/(to) other balance sheet accounts. Other includes foreign exchange movements, non-cash additions including those relating to finance leases and impairments of property, plant and equipment. Aircraft and engines include finance-leased assets with a net book value of $1,507 million. 67

  • Page 70
    ... those relating to finance leases and impairments of property, plant and equipment. Aircraft and engines include finance-leased assets with a net book value of $1,796 million. i. Aircraft by Geographic Area Aircraft supporting the Group's global operations are primarily located in Australia. ii...

  • Page 71
    ... Retained Earnings 2016 $M Opening Balance Closing Reconciliations Inventories Property, plant and equipment and intangible assets Payables Revenue received in advance Interest-bearing liabilities Other financial assets/liabilities Provisions Other items Tax value of recognised tax losses Total...

  • Page 72
    ... the year ended 30 June 2016 13 DEFERRED TAX ASSETS CONTINUED 2015 $M Opening Balance Recognised in the Consolidated Income Statement Recognised in Other Comprehensive Income Closing Balance Reconciliations Inventories Property, plant and equipment and intangible assets Payables Revenue received...

  • Page 73
    ... non-cash financing activities relating to additions of property, plant and equipment under finance leases of $32 million (2015: $30 million). 16 PROVISIONS 2016 $M Current Non-current Total Current 2015 $M Non-current Total Annual leave Long service leave Redundancies and other employee benefits...

  • Page 74
    ...% 3 times 16.2 0.8 - FFO/net debt2 Debt/EBITDA3 Return on Invested Capital (%) Net capital expenditure 4 Shareholder distributions 1 Net debt is a non-statutory measure which includes on balance sheet debt and capitalised aircraft operating lease liabilities under the Group's Financial Framework...

  • Page 75
    ... not exceed the long-term average growth rate for the industry. Cash outflows include capital expenditure for the purchase of aircraft and other property, plant and equipment. These do not include capital expenditure that enhances the current performance of assets and related cash flows have been...

  • Page 76
    ... vesting. (B) SHORT TERM INCENTIVE PLAN (STIP) For details on the operation of the STIP, see pages 37 to 38. There were 735,442 awards of Qantas shares made under the STIP during the year ended 30 June 2016 (2015: nil). (C) MANAGER INCENTIVE PLAN (MIP) The MIP is the annual incentive plan for the...

  • Page 77
    ... the contractual timing of cash flows, including estimated interest payments, of financial liabilities and derivative instruments. The contractual amount assumes current interest rates and foreign exchange rates. 2016 $M Less Than 1 Year 1 to 5 Years More Than 5 Years Total FINANCIAL LIABILITIES...

  • Page 78
    ... and 12 years. To the extent a foreign exchange gain or loss is incurred, and the cash flow hedge is deemed effective, this is deferred until the net revenue is realised. As at 30 June 2016, total unrealised exchange gains on hedges of net revenue designated to service long-term debt was $1 million...

  • Page 79
    ... conducted in accordance with Qantas Group policy. Fuel consumption out to two years may be hedged within specific parameters, with any hedging outside these parameters requiring approval by the Board. For the year ended 30 June 2016, other financial assets and liabilities included fuel and foreign...

  • Page 80
    ... T 2016 Notes to the Financial Statements continued For the year ended 30 June 2016 20 FINANCIAL RISK MANAGEMENT CONTINUED (B) FAIR VALUE The fair value of cash, cash equivalents and non-interest-bearing financial assets and liabilities approximates their carrying value due to their short maturity...

  • Page 81
    ... Financial Statements continued For the year ended 30 June 2016 20 FINANCIAL RISK MANAGEMENT CONTINUED (C) DERIVATIVES AND HEDGING INSTRUMENTS 2016 $M Current Non-current Total Current 2015 Non-current Total Derivative assets Designated as cash flow hedges1 Designated as fair value hedges1 Total...

  • Page 82
    ...financing fees and lease benefits Net gain on disposal of property, plant and equipment Net gain on sale of controlled entity and related assets Share of net loss of investments accounted for under the equity method Other items Adjustments for cash items not included in profit relating to operating...

  • Page 83
    ... Non-current liabilities Total finance lease and hire purchase liabilities 15 15 103 1,366 1,469 93 1,405 1,498 The Qantas Group leases aircraft under finance leases with expiry dates between one and 10 years. Most finance leases contain purchase options exercisable at the end of the lease term...

  • Page 84
    ... L REPOR T 2016 Notes to the Financial Statements continued For the year ended 30 June 2016 22 COMMITMENTS CONTINUED (B) OPERATING LEASE COMMITMENTS 2016 $M 2015 $M AS LESSEE Non-cancellable operating lease commitments (not included in the Consolidated Financial Statements) Aircraft and engines...

  • Page 85
    ...plans, including investment decisions and plan rules, rests solely with the Trustee of the plan. The Trustee of the QSP is a corporate trustee which has a board comprising five company-appointed directors and five member-elected directors. The QSP's defined benefit plan exposes the Group to a number...

  • Page 86
    ...to the Financial Statements continued For the year ended 30 June 2016 24 SUPERANNUATION CONTINUED (C) PLAN ASSETS The major categories of plan assets as a percentage of total plan assets of the Group's defined benefit plans are as follows: 2016 % 2015 % Australian equity1 Global equity1 âˆ' United...

  • Page 87
    ... Flyer Limited Qantas Frequent Flyer Operations Pty Ltd Qantas Ground Services Pty Ltd Qantas Group Flight Training (Australia) Pty Ltd Qantas Group Flight Training Pty Ltd Qantas Information Technology Limited Qantas Road Express Pty Ltd QF Cabin Crew Australia Pty Ltd Regional Airlines Charter Pty...

  • Page 88
    ... CONSOLIDATED CONDENSED BALANCE SHEET 2016 $M 2015 $M CURRENT ASSETS Cash and cash equivalents Receivables Other financial assets Inventories Assets classified as held for sale Other Total current assets NON-CURRENT ASSETS Receivables Other financial assets Investments Property, plant and equipment...

  • Page 89
    ...$'000 2015 $'000 Short-term employee benefits Post-employment benefits Other long-term benefits1 Share-based payments Termination benefits 16,832 501 (141) 7,003 - 24,195 13,985 605 306 6,463 1,316 22,675 1 Other long-term benefits include movement in annual leave and long service leave balances...

  • Page 90
    ...the year ended 30 June 2016 28 PARENT ENTITY DISCLOSURES - Q ANTAS AIRWAYS LIMITED CONTINUED (B) CONDENSED BALANCE SHEET AS AT 30 JUNE 2016 2016 $M 2015 $M CURRENT ASSETS Cash and cash equivalents Receivables Inventories Other Total current assets NON-CURRENT ASSETS Receivables Property, plant and...

  • Page 91
    ... the Income Statement, net of tax Recognition of effective cash flow hedges on capitalised assets, net of tax Net changes in hedge reserve for time value of options, net of tax Defined benefit actuarial (losses)/gains, net of tax Total other comprehensive loss for the year Total comprehensive income...

  • Page 92
    ... measured at fair value of plan assets less the present value of the defined benefit obligation Qantas is a company of the kind referred to in ASIC Corporations (Rounding in Financial/Directors' Reports) Instrument 2016/191. In accordance with that Instrument, all financial information presented has...

  • Page 93
    ...under the equity accounting method and initially recognised at cost, including transaction costs. Subsequent to initial recognition, the Consolidated Financial Statements include the Group's share of profit or loss and other comprehensive income of equity accounted investees, until the date on which...

  • Page 94
    .... The Qantas Group uses a variety of methods and input assumptions that are based on market conditions existing at balance date. The different methods of estimating the fair value of these items have been defined in the Consolidated Financial Statements as follows: Level 1: Quoted prices (unadjusted...

  • Page 95
    ...revenue results from the initial joining fee charged to members. Revenue is recognised on expiry of any refund period. (G) TAXES i. Tax Compliance The Qantas Group is committed to embedding risk management practices to support the achievement of compliance objectives and fulfil corporate governance...

  • Page 96
    ... to the Financial Statements continued For the year ended 30 June 2016 29 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CON TINUED Current Tax Current tax liability is the expected tax payable on the taxable income for the year, using tax rates enacted or substantially enacted at balance date and any...

  • Page 97
    ...to commercial and technological developments, the estimated useful life of assets to the Qantas Group and the long-term fleet plan. iv. Maintenance and Overhaul Costs Embedded Maintenance An element of the cost of an acquired aircraft (owned or finance-leased) is attributed to its service potential...

  • Page 98
    ... that the financing structures impose certain obligations, commitments and/or restrictions on the Qantas Group, which differentiate these aircraft from owned assets. iii. Operating Leases Rental payments under operating leases are charged to the Consolidated Income Statement on a straight-line basis...

  • Page 99
    ...are included in the Qantas Group's net obligation calculations. The calculation estimates the amount of future benefit that employees have earned in return for their service in the current and prior periods, which is discounted to determine its present value, and the fair value of any plan assets is...

  • Page 100
    ... in the Consolidated Income Statement. The discount rate used is the corporate bond rate which has a maturity date that approximates the terms of Qantas obligations. When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or...

  • Page 101
    ... in accordance with AASB 119 Employee Benefits (2011). (P) COMPARATIVES Where applicable, various comparative balances have been reclassified to align with current period presentation. (Q) SEGMENT REPORTING Underlying EBIT of the Qantas Group's operating segments is prepared and presented on the...

  • Page 102
    ...the Qantas Group in the period of initial application. They are available for early adoption at 30 June 2016, but have not been applied in preparing these Consolidated Financial Statements. Topic Key Requirements and Effective Date Impact AASB 9 Financial Instruments (AASB 9 (2014)) AASB 15 Revenue...

  • Page 103
    ... 295A of the Corporations Act 2001 from the Chief Executive Officer and the Chief Financial Officer for the year ended 30 June 2016. 4. The Directors draw attention to Note 29(A) which includes a statement of compliance with International Financial Reporting Standards. Signed in accordance with...

  • Page 104
    ...Changes in Equity and the Consolidated Cash Flow Statement for the year ended on that date, Notes 1 to 29 comprising a summary of significant accounting policies and other explanatory information and the Directors' Declaration of the Group comprising Qantas and the entities it controlled at the year...

  • Page 105
    ... by size of shareholding: Number of Shares Ordinary Shares Held Number of Shareholders % of Issued Shares 1-1,0001 1,001-5,000 5,001-10,000 10,001-100,000 100,001 and over Total 1 2,428 shareholders hold less than a marketable parcel of shares in Qantas, as at 22 July 2016. 22,396,973 123...

  • Page 106
    ...Qantas' share registry, Link Market Services. Log on at www.linkmarketservices.com.au, where you will have the option to: - - - - View your holding balance Retrieve holding statements Review your dividend payment history Access shareholder forms COMPANY PUBLICATIONS In addition to the Annual Report...