Qantas (QF, Sydney Kingsford Smith) will buy back 1,886,044,698 ordinary shares in an on-market offer to run between September 12, 2022, and June 30, 2023. The buyback announcement came on the same day the airline announced its third consecutive annual loss - AUD1.86 billion (USD1.29 billion) for the 12 months to June 30, 2022 (FY2022).

Qantas Group Chief Executive Officer Alan Joyce said in Sydney on Thursday that Covid-19 has cost the airline group around AUD25 billion (USD17.4 billion) in revenue and seen it accrue losses of nearly AUD7 billion (USD4.9 billion). He calls the amounts "staggering," but notes Qantas was one of only six airlines worldwide to retain an investment grade credit rating over the period.

But encouraged by a strong rebound in business and leisure demand in the latter part of the financial year, Qantas will conduct the AUD400 million (USD278.4 million) share buyback across most of FY2023. Qantas says the decision offers shareholders who've supported the airline throughout Covid-19 the opportunity of a capital return.

"The (Qantas) board has approved an on-market share buyback of up to AUD400 million as the benefits of the recovery materialise," says a statement from the airline group. "This is the first return to shareholders since 2019 and follows AUD1.4 billion (USD970 million) of equity raised at the start of the pandemic."

Speaking at a media conference after the financial results announcement, Joyce said the speed and scale of travel recovery had been exceptional. For the first half of FY22, Australia's borders (including many internal borders) remained shut, severely hampering the operations of Qantas and other Australia-based airlines. But by the fourth quarter of the financial year, nearly all movement restrictions had been lifted, leading to that late surge in passenger demand.

Pending no further major disruptions, most local financial analysts expect Qantas to return to profitability this financial year. However, the Qantas CEO remains under pressure in Australia after a disastrous run of operational issues recently that have severely damaged the airline's reputation in its home market and caused some to question Joyce's ongoing tenure as CEO. However, the CEO rebuffed any resignation rumours during the media conference.

"I think I've had more rapid resignation requests that any other CEO or public figure out there - it's not unusual, it's part of the job. The board asked me to continue in this job to get through this crisis. I think at the other end of this, Qantas will be stronger than it was before it went in."

Joyce says the run of bad publicity surrounding Qantas relates to its physical operations rather than its commercial business, which is now enjoying record demand. However, labour shortages and absenteeism (Qantas says around 320 pilots per day are unavailable to work because of illness or isolation rules) continue to cause problems at the airline and cause reliability issues.

News of the share buyback was well received on the markets, with the share price spiking 6% on Thursday. At the close of the markets in Sydney on Friday, the Qantas share price was up 13.6% for the week.