Amid all the words written about the Qantas dispute this morning, no one has mentioned the most important bit of information: money. The war chest of more than $3 billion that Qantas has been building up over the years for a situation such as this.

Yes, they’ve talked on and on about the cost to Qantas of the now-aborted shutdown and the union problems at $20 million a week or more, but not one reporter looked at how Qantas would pay for it.

Qantas has plenty of cash — billions of  it. The 2010-11 profit report reveals the huge dollop of cash the airline owned at the end of June: just over $3.7 billion, up from $3.5 billion at the end of the 2010 year.

Qantas’ labour bill in all divisions was $3.7 billion and fuel was $3.6 billion in 2011. If Qantas wasn’t flying, the fuel bill and labour costs would be slashed.

Qantas has been building this cash cushion for years: originally there were claims it would be used by former CEO Geoff Dixon, whom many unions and other critics claimed would ground the airline and take on the unions.

The claim was that the cash cushion was being built for that purpose, but nothing happened during Dixon’s term except a lot of noise and rhetoric from all sides.

Qantas will have a lot of outgoings, but it will still have some revenues coming in from maintaining Jetstar and Qantas link businesses, as well as its ground transport business, but that will also be impacted by the shutdown as those planes that carry freight, won’t be flying.

Jetstar made an “underling profit” of $169 million in the year to June, up 38% from the year before, on revenue of $2.6 billion. QantasLink’s figures were not broken out.

For the year ended June 30, Qantas reported underlying profit before tax rose 46% from a year earlier to $A552 million. Reported profit after tax more than doubled to A$250 million. Revenue rose 8.1% to A$14.89 billion. But its the huge cash pile that is the most important figure in all of that.

Peter Fray

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