HSC BUSINESS FINANCIAL MANAGEMENT CASE STUDY QANTAS 2023 SOLVED UPDATE

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Profitability- COST CONTROLS - ANS-3 year cutting cost program ending in 2017: cut 5,000 jobs. sold planes/delayed delivery, froze wages —> 2019 generated record earnings allowing shareholders t... o receive dividends Reducing fixed costs - restructuring management and employment relations to improve efficiency of rostering system - implementing more technology for long term cost gains to minimise waste Reducing variable costs - fuel conservation - cutting commissions to travel agents - casualisation of the workforce to reduce benefits paid to full-time employees - downsizing workforce to reduce wage and salary outflows (stood down 6,000 since 2014) - deferring/delaying new fleet deliveries Profitability- REVENUE CONTROLS - ANS-- entering into new strategic alliances to improve attract-ability of Qantas as if Q can't fulfil a route, one of its partners can, expansion of services into the growing Asian market, improving marketing/appeal through the new international business class and check-in kiosks Profitability- EFFECTIVENESS - ANS-- Effective as cost-cutting saved 3.2B over last 5 years, reducing overall cost face by about 20% - Despite 21% fall in revenue, managed to still post a 124M underlying profit - fuel and labour costs variable so can be difficult to control Net profit ratio 0.06:1 2015 0.09:1 2019 ROE 44% 2019 47% 2017 Liquidity- CASH FLOW MANAGEMENT - ANS-- managing cash flow by writing cashflow budget helping to predict trends, identity peaks and troughs in demand so Q can prepare - reducing outflows by taking advantage of discounts for early payment - distributing payments through activities like leasing Continues... [Show More]

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