Independent Senator Nick Xenophon headlined a list of frustrated shareholders looking for answers at Qantas’s annual general meeting in Melbourne on Friday.
The Senator took the step of purchasing $500 worth of Qantas shares to attend Friday’s annual general meeting and quiz the board on “questions that mum and dad shareholders have asked me to ask”.
Xenophon focused on the so-called real cost of Jetstar’s Asian operations, the nature of “confidential” briefings given to institutional investors and how Air New Zealand was able to post record profits while Qantas slumped to a $2.8 billion loss in 2013/14.
On Jetstar, Xenophon asked chairman Leigh Clifford and chief executive Alan Joyce whether the low-cost airline group had “actually extracted one dollar of tangible, trade-related profit from any of the Asian investments in the last decade”.
“I’m not talking about book profit,” Xenophon said at the AGM. “To what extent has Qantas brought one dollar home from Asia in a decade in terms of the Jetstar Asia franchises”.
In response, Joyce said Jetstar Asia – the Singapore-based airline – had “made money four out of the last 10 years.”
“Last year it lost money because its local competitor added a huge amount of capacity and pushed the market into losses,” Joyce said.
“There is now rationalisation of capacity and we see a path through for that business to go back into profits like it was in the previous four years before that capacity was added and I am comfortable it will get there.”
Joyce and Jetstar Group chief executive Jayne Hrdlicka have both said previously Jetstar had delivered $1 billion in profits to the Qantas Group.
However, Xenophon said he didn’t regard those claims as credible.
“Under current Australian accounting laws you can be as clear as mud when it comes to transference of costs within divisions of an airline,” Xenophon told reporters prior to the AGM.
“I suggest that Jetstar Asia has been the big black hole for Qantas.”
Xenophon also queried the nature of what Qantas told a Senate committee were confidential briefings with institutional investors between October 18 – the date of last year’s AGM – and December 5 2013.
In response, Joyce said: “There is never selective briefings that involve any information that is not available to all shareholders.”
The gathering at the Melbourne Exhibition and Convention Centre, which lasted about two hours and 20 minutes, also heard from a number of Qantas staff members keen to share their views about the current state of the company.
Col Rayner, a member of the Transport Workers Union, who works as an airline service operator for Qantas at Sydney Airport, said morale among his work colleagues was “at an all-time low”.
Meanwhile a Qantas 737 captain, Greg Harper, said record customer satisfaction levels the airline has been touting probably didn’t include Qantas international passengers in Perth and Adelaide, given Qantas had left them “high and dry”. Moreover, he said management “hadn’t been up to scratch”.
“To say our customers, who we have surveyed, say we are doing well, they are the customers we have left,” Harper said.
Elsewhere, a Qantas business class flyer and shareholder said the airline had been “gutted” under Joyce and Clifford’s leadership.
And Australian Services Union assistant national secretary Linda White also urged Qantas to reconsider the loss of staff from the closure of call centres in Brisbane and Melbourne.