Qantas posts $245 million loss

QANTAS has slumped to a worse-than-expected $245 million full-year loss, its first since Australia's largest airline was fully privatised 17 years ago, due to high fuel prices, intense competition and industral disputes.

The statutory loss for the year to June compares with a $250 million profit a year earlier. The market had expected Qantas to post a net loss of $224 million for the year.

Qantas also announced it will cancel firm commitments for 35 state-of-the-art Boeing 787 jetliners to contain costs. The move will reduce capital spending by $US8.5 billion ($8.1 billion), based on list prices for the planes, although the actual amount will be less once discounts are taken into account.

The airline posted revenue of $15.7 billion for the year to June 30. The airline said it generated an underlying pre-tax profit of $95 million, a fraction of the $552 million a year earlier.

The loss itself is not a huge surprise because the airline group, which includes Jetstar, had warned in June that it would slide into the red due to high fuel prices, big losses from its premium international business and a battle with Virgin Australia in the domestic market. Still, the fact it came in even larger than tipped may see the company's shares take a hit when trading resuming this morning.