Qantas on course to beat forecasts

AUSTRALIA'S main airline Qantas has heralded stronger-than-expected profits for this year. Qantas, where British Airways holds a 22% stake, said today it expects its full-year 2002 profit to come in more than 10% above the A$550m (£211m) it has forecast.

In a statement to the Australian Stock Exchange, Qantas chief Geoff Dixon cited factors such as a 'faster-than-expected' recovery in the international aviation market and 'improved overall productivity' for the bullish forecast.

After the demise of longtime rival Ansett, which collapsed in September last year, Dixon said Qantas had also benefited from a 'solid domestic performance'. Following the collapse of Ansett, Qantas now has 85% of a domestic market worth A$10bn a year. Its only competitor is recent arrival Virgin Blue.

Qantas has trimmed its workforce by around 1,500, and says it is achieving savings from a 'significant increase' in sales over the internet. The shares jumped more than 6% after the announcement, and raced to A$4.65, their highest in more than a month. BA's stake fell to 22% last year after it declined to take part in a Qantas capital raising.

The Federal government is reportedly set to announce the winning bidder for Sydney Airport this week. British airports group BAA, which operates Melbourne Airport, is providing management and technical advice to the favoured bidder, a consortium led by Hong Kong's Cheung Kong.