Qantas 2005 Annual Report Download - page 15

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Other key focus areas for the coming year include:
x continuing efforts to deliver market-leading on-time
performance in all flying businesses, with a range of
initiatives to be rolled out in 2005/06;
x investing in airport product, with a major expansion
and enhancement of QuickCheck kiosks throughout
Australia;
x growing Jetstar Asia, which is poised to secure a strong
position in the Asia value-based airline market following
its merger with Valuair; and
x increasing portfolio diversification through continued
growth of air freight businesses.
FLEET FOR THE FUTURE
Qantas’ last major fleet commitment was announced in
November 2000. It included the purchase of 12 A380, six
747-400ER and 13 A330-200 and A330–300 aircraft.
Since then, the Qantas Group has also purchased additional
737-800 aircraft as well as 23 A320s (three of which are
leased) for operation by Jetstar.
Qantas holds options on the A320 and the 737-800,
which will cover domestic growth and the possible need to
replace the 737-400 fleet in the future.
Qantas has now taken the first step in what will be the
Group’s largest fleet renewal program since 2000, issuing a
Request for Proposal to aircraft manufacturers in August 2005
for the future provision of new wide-body aircraft.
These aircraft will potentially replace the Group’s fleet of
medium wide-body 767-300 aircraft and also cater for
international capacity growth and new route opportunities
in coming years – including medium-haul routes in Asia as
well as services into the USA and Europe.
Qantas is seeking detailed pricing and performance
information from Airbus and Boeing on aircraft types
currently in production as well as new types and variants
under development: the 787 and A350 aircraft for possible
use on international, trans-Tasman and Australian domestic
routes; and the ultra-long range variants of the 777 and
A340 to operate on “hub-busting” routes.
This move is consistent with Qantas’ commitment to
offering customers a modern fleet that also delivers
maximum flexibility to address emerging opportunities,
lower seat mile costs, greater fuel efficiency and
opportunities to introduce the next generation of inflight
services.
The new aircraft options will complement Qantas’ A380
strategy. The A380 – the biggest passenger aircraft in the
world – will enable Qantas to add capacity on key routes
that are slot-constrained.
Qantas is progressing preparations for the delivery of its
first A380 in April 2007, following the six-month delay in
delivery advised by Airbus during the year. Qantas remains
on track and on budget for all aspects of the program.
ENSURING SECURITY
Qantas’ focus on security for the safety of customers and
their baggage, staff and assets has never been greater.
Qantas is at the forefront of aviation security, having
invested more than $600 million in security measures over
the past three years. Qantas is continually upgrading and
modifying procedures to meet changing circumstances.
Qantas already has more than 900 CCTV surveillance units
in operation throughout Australia. Qantas responded to
heightened community concern in 2004/05 by announcing
it would install CCTV surveillance equipment throughout
all the baggage handling areas at all Qantas owned or
solely leased domestic terminals in Australia, in the holds of
some aircraft and at other airport locations. The additional
equipment will ensure, as closely as possible, 100 per cent
coverage of key baggage areas in Qantas terminals.
Qantas works closely with government agencies and police
forces on a wide range of security issues. Qantas moved
quickly in support of the Australian Government’s security
initiatives announced in June 2005. Within a month, new
measures were introduced at Sydney, Melbourne, Brisbane,
Adelaide and Perth Airports, including:
x the closure of a significant number of airside access
gates, including a 90 per cent reduction in Sydney;
x security inspections to cover all staff and their
possessions, visitors and vehicles at the remaining entry/
exit points; and
x increased uniformed security presence on the ramp and
in baggage areas.
Additional measures at other airports are being introduced
progressively after discussions with the Australian
Government.
Qantas will continue to work with all governments and
airport authorities to ensure the best possible security
result.
ACCOUNTING PRACTICES
Qantas is adopting Australian Equivalents to International
Financial Reporting Standards (A-IFRS) for 2005/06. The
financial report for the half year to 31 December 2005 will
be Qantas’ first report under the new standards.
A-IFRS will not affect the Qantas Group’s cash flows, credit
ratings, dividend policy or economic management. Qantas
does not expect any significant impact on future earnings
or any change to capital management policies as a result of
the change.
SHARING THE SPIRIT
February 2005 marked the first anniversary of Qantas’
Sharing the Spirit community program.
More than 80 events were held around Australia in the first
year, benefiting important charities such as the Starlight
Children’s Foundation, UNICEF, CARE Australia and
Mission Australia.
Qantas Annual Report 2005
~Report from the Chairman and Chief Executive Officer~