14-Jan-2011 9:53 AM

A380 engine trouble to hit Qantas profit: RBS

Qantas’ A380 engine problems will reportedly reduce the airline’s pre-tax profit by 10% (The Australian, 14-Jan-2011). RBS expects the A380 engine explosion and its aftermath will in 2011 cost Qantas up to AUD80 million. The broker stated Rolls-Royce is likely to cover at least 75% of Qantas’ losses, but it doesn’t expect this to happen until FY2011/12. As a result, RBS reduced the airline’s FY2011 pre-tax profit estimate to AUD766 million and increased its FY2012 estimate by 5.1% to AUD1.25 billion. RBS also warned of “reputational damage”, which may lower load factors and yields.

Want More News Like This?

CAPA Membership gives you access to all news and analysis on the site, along with access to many areas of our comprehensive databases and toolsets.
Find Out More