Record levels of revenue were achieved by Qantas in the three months to September in the face of rising fuel costs.
Quarterly revenues rose by 6.3% to A$4.41 billion over the same southern hemisphere winter period last year.
The strong performance helped to offset higher fuel costs and a rise in other expenses, such as higher commissions paid to travel agents on the high revenue and the impact of a weaker Australian dollar.
The airline’s full year fuel cost is expected to be A$4.09 billion against A$3.23 billion in the previous financial year.
Overall capacity in the period was down by 0.3% across both international and domestic networks.
International revenue grew by 4% year-on-year following changes including the introduction of the first non-stop London-Perth service and a refocus on the carrier’s hub in Singapore.
A Boeing 747-400 was retired in September with a remaining nine jumbo jets to be phased out by the end of 2020. Two additional Boeing 787-9 Dreamliners will be delivered next month, taking the fleet of the new generation long-haul aircraft up to eight.
The value of forward bookings at September 30 was up by eight per cent, an improvement of the 6.2% increase at the end of June.
Group CEO Alan Joyce said in a management update: “Our record passenger revenue performance meant that we were able to substantially recover higher fuel prices.
“Market demand for travel remains fundamentally strong and we’re seeing some wind-back of competitor capacity growth.
“We have a strong focus on cost and we’re continuing to invest in aspects of customer experience that deliver a competitive edge and margin benefit.”
He cited investment in a new first class lounge at Singapore Changi airport and the expansion of an existing business class lounge to collectively cater for more than 800 passengers next year as an example.
“Based on the value of forward bookings and broader market conditions, we’re confident in our ability to manage higher fuel costs and keep investing, while still delivering strong net free cash flow and long term shareholder value.”