Today Qantas announced its full year financial results, an update on the accelerated Transformation program announced last February and the outcomes of the Structural Review announced last December. I have received many questions in the lead up to today and wanted to reach out to you with an update as a valued customer.

Financial Year Results and Transformation Program

Today's financial year results are confronting. But they represent the year that is past. The Group is addressing its major challenges and we have now come through the worst. Our Transformation program is on track. Our overall financial performance is rapidly improving and, subject to events outside our control, the Group is expecting to a return to an Underlying PBT profit in the first half of the current financial year.

Structural Review including Qantas Loyalty

The Structural Review announced last December is now complete and the results include the following decisions:
• No sale of Qantas Loyalty. Qantas Loyalty is a standout business of the Qantas Group, which I am proud to lead. After careful consideration, our judgement was that Qantas Loyalty continued to offer significant growth opportunities and there was insufficient justification to sell any part of it.
• The continuing sale of non-core assets such as airport terminals, land and property holdings, where this enhances shareholder value.
• As a result of recent amendments to the Qantas Sale Act, and building on the existing domestic and international airline separation at internal management level, Qantas will establish a new holding structure and corporate entity for Qantas International. This is about creating longer term options for this great airline - there are no changes to network, staffing or operations as a result of today's announcement.
• As a consequence of this change, accounting rules require assets to be reassessed. The international fleet value has been written down to be aligned to current market value. This writedown is the biggest component in today's result but it is a non-cash cost and does not alter the fundamentals of our business.
• No new Jetstar ventures will be established while the Group is focused on transformation. Substantial value exists across the Jetstar Group airlines to be realised over time.

Investing in Customers

Customers are at the heart of everything we do at Qantas. We are continuing to invest to make your experience even better.
• We will continue to introduce more everyday ways for members to earn and redeem Qantas Points to add to the thousands of opportunities that exist today.
• In the past year Qantas Loyalty has introduced Qantas Cash, the award winning prepaid travel card; Aquire, the new loyalty program for small and medium enterprises; and qantaspoints.com - a dedicated website for members and partners, including an Online Mall. The Qantas Golf Club is planned for launch this coming summer and we will continue to focus on innovating to further reward members.
• We keep investing in our people to deliver outstanding customer service and continue to lead on key indicators, including customer advocacy and on-time performance.
• We are accelerating the retirement of older aircraft and updating and reconfiguring the cabins of our Airbus A330 and Boeing B738 fleets. The upgrade of our Airbus A330 fleet features new Business fully flat beds and the latest Panasonic entertainment system, to be progressively introduced on our domestic and international network from late 2014.
• We are investing in new and expanded international and domestic lounges. In addition to the recently opened Los Angeles Business, Hong Kong and Singapore lounges, the new Los Angeles First and expanded Business lounges will open later this year. Lounge upgrades will also be introduced domestically in Darwin and Brisbane.

Thank you for your Loyalty

Loyalty is a relationship business, and I sincerely appreciate the commitment of our members, partners and people. We will do everything in our power to keep earning and deserving that support. We have a lot of exciting plans for our customers.

We are looking to the future, can move forward with certainty and are passionately committed to rewarding you for your loyalty, whether on the ground, or in the air.

More detail on our result is available from qantasnewsroom.com.au.