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Mon, Feb 21, 2005 - Page 12 News List

Qantas warns on slash in earnings

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A Qantas Boeing 767 preparing for takeoff from Sydney International Airport.

PHOTO: AFP

Qantas Airways Ltd.'s pre-tax earnings may fall by as much as A$44 million (US$35 million) should Singapore Airlines Ltd be allowed to fly between Australia and the US, Qantas chief executive Geoff Dixon said.

The Australian government is holding talks with Singapore on whether to allow Singapore Airlines to fly the route, which accounts for about 10 percent of the annual profit of Sydney-based Qantas, Australia's biggest carrier.

"It could be close," to A$44 million, Dixon said in an interview today on Channel Nine's Business Sunday program. Dixon was responding to a question which cited analysts reports that it could lose that much from pre-tax earnings. On Feb. 17, Dixon had said he couldn't estimate the impact on earnings because he didn't know how Singapore Airlines would service the route.

The Australian government "is almost at a point where we can make a decision and the proposal can come before cabinet," Australian Industry Minister Ian Macfarlane said on Feb. 17.

Australian Transport Minister John Anderson met his Singaporean counterpart Yeo Cheow Tong on Feb. 14.

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