qantas airways founded in 1920 the 2 nd oldest airline in the world, and the oldest in the...
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Qantas Airways
• Founded in 1920• the 2nd oldest airline in the world, and the oldest in the English-speaking
country• In year 2000, Qantas was “The Best Corporate Image” in Australia for
11th consecutive years
Company Profile
Nature of Business
Domestic and International Air Transportation and Airfreight Qantas Holidays Flight Catering Engineering and Maintenance The Qantas Frequent Flyer Information Technology
Company Valuation Size of Qantas
- Market Capitalisation $ 4.167 billion- Value of the firm $ 15 billions- Value of equity $ 12 billions- Net Debt $ 2.995 billions
Profitability Analysis- Revenues increase 7.8%- Expenditures increase 7%- Net Profit before Tax increase 15.1%- Operating Profit before Tax increase 17.2%- Net Profit after Tax increase 23.0%
Share Price History
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Qantas ASX 200
Sept 7 Sir Richard Branson’s Virgin Blue starts Brisbane-Sydney Service
Source: Bloomberg
June 4 Impulse launches Sydney-Melbourne and Sydney-Canberra services
Nov 27 Qantas to Impose $10 surchange on domestic routes to counter fuel prices
Feb 21 Qantas first-half profit dips 22 pc-First fall since 1995 privatization
May 1 Losess forces Impulse to quit major domestic routes
Company Calculation Results
• Beta = 0.7659028 • Cost of Debt = 11.63% • Cost of Equity = 10.76% • Cost of Capital = 7.12 %
• Market Capitalization = $ 4,166,043,930• Value of The Firm = $ 15,000,904,132• Value of Equity = $ 12,005,904,132• Price per Share = $ 9.91
Elasticity
The Change in(change +/- 1 denomination) Cost of Debt Cost of Equity WACC Free Cash Flow Beta
Risk premium - 0.007659028 0.002852 - -Risk Free Rate - 0.01 0.003723 - -tax rate - 0.000732454 -0.000844 -19901410 0.01221Growth Rate - - - 58026240 -Inflation - - - -47350400 -
NoteAssumptions :Change is calculated in one variable at one time(ceteris paribus)Calculation of change in:- Beta is in 0.1 denomination- Risk premium is in 0.01 denomination- Tax rate is in 0.01 denomination- Growth rate is in 0.01 denomination- Inflation is in 0.01 denomination
Resulted change in