Qantas Airways Ltd, which reported last week its first loss in eight years, may sell its Australian airport terminals as it seeks to fend off competition from Virgin Blue Airlines Pty.
The review may take six months, Sydney-based Qantas said in a statement to the Austra-lian Stock Exchange. It is reviewing all property assets including its domestic freight and passenger terminals to determine whether these should be retained or sold, the airline said.
Qantas, which sold and leased back its head office near Sydney airport in 2001, is revamping its business after discount airline Virgin Blue captured about a third of the domestic market in three years. Chief executive Geoff Dixon is planning to replace full-time workers with more part-time staff, swap business class seats with more in coach and buy more efficient planes.
"They have reasonable cash at the moment but two or three years down the track, they will need to raise additional capital," said Bruce Low, an analyst at ABN Amro Australia Ltd.
The value of the property assets being reviewed is about A$300 million (US$195 million) to A$500 million, he said.
Qantas owns its domestic passengers terminals at Sydney and Melbourne airports. Its spokesman Michael Sharp wasn't immediately available to comment.
Qantas could sell and lease back some of its property assets, or spin them off into a separate property trust, Dixon told BRW magazine last month. The airport terminals are profitable, he said.
"Not many airlines own their own terminals," Dixon was quoted as telling BRW. "We make money out of the terminals but it is money tied up. I suspect it is more efficient not to own them."
Quantas had a net loss of A$9 million in the six months ended June 30, from a A$274.5 million profit a year ago, the Sydney-based company said last week. Sales were hurt by increased competition and the outbreak of SARS.
Sydney Airports Corp bought the lease for the Sydney terminal of Ansett Holdings Ltd for A$200 million last year.
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