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54
QANTAS ANNUAL REPORT 2014
DIRECTORS’ REPORT CONTINUED
FOR THE YEAR ENDED 30 JUNE 2014
Annual
Incentive
Also referred
to as the Short
Term Incentive
Plan or STIP
(continued)
Customer Service – NPS
Customer Service is measured against NPS targets which involved a five point improvement on each business’
2012/2013 result.
This is a survey-based measure of how strongly our customers promote the services of our businesses in
preference to our direct competitors. Individual NPS targets are set for Qantas Domestic, Qantas International,
Qantas Frequent Flyer, Jetstar Australia Domestic, Jetstar Asia, Jetstar Japan and Jetstar Pacific.
What was the STIP scorecard outcome for the year ended 30 June 2014?
The Board determined that despite significant progress on the transformation agenda and that customer,
operational and safety performance was strong (as outlined in the table below), the Group financial performance
did not warrant any awards under the 2013/14 STIP. Therefore, the STIP scorecard outcome for 2013/2014 was nil.
The table below summarises performance vs target against each scorecard category under the 2013/14 STIP.
Scorecard Category
Group Financial
Measures
The Underlying PBT and the operating cash flow to net debt results were
belowtarget.
People and
Operational
Safety
There was an improvement in performance against each people safety measure
and the threshold target was achieved for each measure.
Operational safety performance for the year was good.
Domestic
Businesses
and the
Transformation
Agenda
Qantas Domestic achieved its punctuality targets, leading the competition in all
12months in 2013/2014.
Qantas Domestic and Jetstar Australia Domestic customer performance was very
good, achieving significantly improved NPS results during 2013/2014.
The domestic businesses (Qantas Domestic (including QantasLink) and Jetstar
Domestic) achieved their network and frequency advantage objectives for
2013/2014.
Qantas Domestic achieved its unit cost target.
Key business transformation milestones were achieved across Qantas
Engineering, Catering, Customer Services, Ground Operations, Freight and the
Corporate Centre.
Qantas
International
and Qantas
Loyalty
The strategic partnership with Emirates delivered significant customer benefits
during 2013/2014.
Qantas expanded its Asian network via new codeshare agreements with China
Southern and continued to enhance its alliance with American Airlines.
Qantas International achieved its unit cost target.
Qantas International customer performance was also very good, achieving
significantly improved NPS results during 2013/2014.
Qantas Frequent Flyer has continued to grow with membership now exceeding
10million and the program achieving significantly improved NPS results for
2013/2014.
Qantas Loyalty successfully launched two new major initiatives during the year,
being Qantas Cash and the Aquire business rewards program.
Jetstar in Asia Jetstar Asia achieved its unit cost target. Underlying EBIT targets for Jetstar
Japan and Jetstar Pacific were not achieved.
Jetstar Asia, Jetstar Japan and Jetstar Pacific each achieved significantly positive
customer service (NPS) scores in 2013/2014.
Continued progress was made in the growth of Jetstar branded airlines in Asia,
including:
–Jetstar Japan establishing a second base in Osaka
–Jetstar Hong Kong further delayed, but some progress made in the Hong Kong
regulatory process
–Jetstar Pacific agreeing a re-capitalisation plan and fleet expansion plan, to
facilitate launching of international services
Key: Full (or above target)
achievement against targets
Partial achievement
againsttargets
No achievement
againsttargets
REMUNERATION REPORT (AUDITED) CONTINUED