QANTAS ANNUAL REPORT 2022

Q A N TA S A N N U A L R E P O R T 2 0 2 2

Contents

Financial Snapshot 02

Five-Year History 03

Chairman’s Message 04

CEO’s Message 06

Supporting Australian Businesses 08

Board of Directors 09

Review of Operations 12

Condensed Corporate Governance Statement 27

Directors’ Report 29

Financial Report 65

Shareholder Information 147

Financial Calendar and Additional Information 148

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Financial Snapshot1

($1.86) billion ($1.19) billion $281 million

UNDERLYING LOSS STATUTORY LOSS UNDERLYING EBITDA
BEFORE TA X BEFORE TA X

$3.94 billion $920 million $4.6 billion

NET DEBT ANNUALISED STRUCTURAL TOTAL LIQUIDIT Y
COST BENEFITS DELIVERED
SINCE 30 JUNE 2020

Other Highlights

47% 1 million
MORE QANTAS
OF JETSTAR CUSTOMERS
FREQUENT FLYER
PAID LESS THAN $100
MEMBERS SINCE
FOR DOMESTIC FARES
START OF PANDEMIC

19 20+
INTERNATIONAL PORTS NEW DOMESTIC
RESTARTED, EIGHT NEW ROUTES ADDED
ROUTES ANNOUNCED DURING THE YEAR

1 Refer to the Review of Operations section in the Qantas Annual Report 2022 for definitions and explanations
of non-statutory measures. Unless otherwise stated, amounts are reported on an underlying basis.
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Five-Year History
FINANCIAL PERFORMANCE 1
2022 2021 2 2020 20192 20182
Revenue and other income $M 9,108 5,934 14,257 17,966 17,128

Statutory (Loss)/Profit Before Tax $M (1,191) (2,299) (2,708) 1,192 1,352

Statutory (Loss)/Profit After Tax $M (860) (1,692) (1,964) 840 953

Underlying (Loss)/Profit Before Tax $M (1,859) (1,774) 124 1,326 1,565

Underlying Earnings Before Interest
$M (1,558) (1,473) 395 1,608 1,747
and Tax (EBIT)
Operating Margin % (17.1) (24.8) 2.8 9.0 10.2

Underlying Earnings Per Share cents (71.2) (69.4) 5.9 57.3 63.0

Statutory Earnings Per Share cents (45.6) (89.9) (129.6) 51.5 54.4

Return on Invested Capital (ROIC) % (31.6) (21.4) 5.8 19.2 21.4

Share price at 30 June $ 4.47 4.66 3.78 5.40 6.16

Dividend per share3 cents – – – 25 17

Cash flow from operations $M 2,670 (386) 1,083 3,164 3,413

Net Free Cash Flow $M 2,430 (1,108) (488) 1,601 1,442

Net on balance sheet debt $M 2,617 4,609 3,173 2,980 3,054

Net Debt $M 3,937 5,890 4,734 4,710 4,903

Net capital expenditure $M 398 693 1,571 1,563 1,971

Shareholder distributions3 $M – – 647 1,000 1,000

Unit Revenue (RASK) c/ASK 9.48 9.72 8.99 8.85 8.40

Total unit cost 4 c/ASK (13.16) (15.76) (8.87) (7.97) (7.37)

Ex-fuel unit cost 4 c/ASK (9.64) (12.62) (4.41) (4.23) (5.37)

STATISTICS
2022 2021 2020 2019 2018
Available Seat
M 50,633 29,374 111,870 151,430 152,428
Kilometres (ASK)
Revenue Passenger Kilometres
M 34,363 18,557 92,027 127,492 126,814
(RPK)
Passengers carried ‘000 21,257 15,866 40,475 55,813 55,273

Revenue Seat Factor % 67.9 63.2 82.3 84.2 83.2

Aircraft at end of period5 322 315 314 314 313

1 Refer to the Review of Operations section in the Qantas Annual Report 2022 for definitions and explanations of non-statutory measures.
Unless otherwise stated, amounts are reported on an underlying basis.
2 2 021 has been restated for the impact of the adoption of the IFRIC agenda decision in relation to Cloud Computing. 2019 has been restated
for the impact of the adoption of AASB 16 Leases and the IFRIC agenda decision in relation to fair value hedges. 2018 has been restated
for the impact of AASB 15 Revenue from Contracts with Customers.
3 Dividend per share is calculated as the interim and final dividend in relation to the relevant financial year. Shareholder distributions includes
dividends paid and share buy-backs and are reported in the year cash distributions are made.
4 T he comparative period has been adjusted for foreign exchange movements to make it comparable to the current year. 2021 and 2022
reflect the foreign exchange rates as presented in the 2022 Annual Report. The same applies for 2020, 2019 and 2018 which have been
adjusted for foreign exchange in line with the 2021, 2020 and 2019 Annual Reports respectively. 2020 and 2019 have also been adjusted
for the impact of the sale of domestic terminal leases and depreciation and amortisation.
5 2 021 has been restated to include the embedded lease and related financing of Embraer E190s. Group Fleet now includes embedded
lease and related financing of Embraer E190s and 747 Atlas Freighters as they have been recognised as debt in accordance with the
Financial Framework. The Financial Framework recognises lease arrangements that serve permanent capacity. 03
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Chairman’s Message

‘Before COVID-19, we safely flew more than

50 million passengers each year and had
a well-earned global reputation for premium
service; as we recover, we’re all working
hard to return to those heights.’

I want to start by recognising the But, as we all adjusted to living with During the year, the Board approved
efforts of the entire Qantas team COVID-19, travel rebounded in the what is cumulatively the largest
over the past year. Across the Group, fourth quarter with a speed and scale aircraft order in the Qantas Group’s
our people have shown incredible that was extraordinary, resulting history. Airbus A321XLR and A220
resilience and professionalism as in the highest sustained levels of aircraft will drive the renewal of the
we’ve restarted our operations and travel demand since the start of the Group’s domestic fleet over the next
safely carried millions of customers. pandemic. While this rapid increase decade and open up new direct routes
brought its own challenges for the across Australia, including in regional
The past year has, in many ways,
industry both in Australia and globally, areas. The A350 and Project Sunrise
provided a sober reflection of the
it marked a turning point from crisis will make any city just one flight from
full impact of the pandemic on
to sustained recovery. Australia, overcoming the last frontier
the aviation industry, with the
and resolving the tyranny of distance.
stop-start nature of the recovery The Qantas Group has emerged from
proving exceptionally challenging for the pandemic a structurally different These next-generation aircraft
our operations, tough for our people but fundamentally stronger and more will reduce emissions by at least
and frustrating for our customers. resilient company. The progress 15 per cent if running on traditional
that we’ve made on our three-year jet fuel, and significantly better when
Even as the industry began the year
Recovery Plan — with more than run on sustainable aviation fuel,
with optimism about lockdowns and
$920 million of cost benefits helping us meet our commitment
restrictions easing domestically and
already delivered — meant we were on cutting emissions.
with international travel returning,
able to endure the challenges and
the Delta and Omicron waves once Even as we navigated the impacts
recover quickly.
again closed borders and supressed of the pandemic, we’ve kept focus
travel demand. Beyond the cost benefits our on our sustainability commitments.
Recovery Plan delivers, it’s the During the year we launched the first
competitiveness, agility and resilience Qantas Group Climate Action Plan,
we’ve built into the Group that providing a roadmap for the Group
gives us confidence in our future. to reach its net zero goal by 2050
Recovering quickly also means we’re and interim targets for 2030.
able to reduce debt built up during
the pandemic and invest for growth
and future success.
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The Board is incredibly grateful for I’d also like to thank my fellow Before COVID-19, we safely flew more
the efforts of employees across the Directors for their stewardship as than 50 million passengers each
Qantas Group during the challenging the Company navigated the depths year and had a well-earned global
period of the pandemic and our of the crisis and positioned for reputation for premium service; as
restart. We’ve invested in a number recovery and growth. Their high level we recover, we’re all working hard
of initiatives designed to recognise of commitment brought experience to return to those heights.
their contribution to our recovery and and insight to bear on the significant
This past year has seen us navigate
retain the talent we need for future issues that the Qantas Group faced.
the depths of the COVID-19 crisis,
growth. These initiatives include
Also key to surviving the pandemic but also the turning point that gives
around $10,000 of incentives and
was the incredible support of Qantas’ us all so much confidence in the
share rights as we reach important
shareholders, with $1.4 billion raised future of the Qantas Group.
milestones in our recovery, and
to help fund the Group’s recovery
a significant boost to Staff Travel,
program. With that recovery well
which we know our people value.
underway and net debt reduced to
I want to recognise the Qantas Group below our target range, the Company
Management Committee led by Alan is able to return capital to investors.
Richard Goyder AO
Joyce. The fact the Group has come In line with the Company’s financial
through the pandemic in such a strong framework, the Board has approved
position is remarkable. The decisions an on-market share buy-back of up
made during that period were not easy to $400 million.
— and not always popular — but they
were necessary to ensure our iconic
company not only survives, but can
grow into its next century.

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CEO’s Message

‘The impact of the pandemic on the

Qantas Group has been staggering. But
the support of our people, our customers
and our shareholders has meant we’ve
come through the other side.’

Looking back on the past year brings The pandemic has been incredibly
into focus both the depths of the challenging for our people. We
pandemic and the bright signs of announced in December 2021 that
recovery. We experienced three all of our Australian-based employees
quarters where our business was were able to come back to work.
severely impacted by COVID-19 For many of our international crew
lockdowns and restrictions, members this was six months ahead
followed by a fourth quarter that of schedule and well ahead of demand
showed the resilience of air travel returning, but it meant we could
and our Company. deliver training and other preparations
for our restart.
The Qantas Group’s 2022 financial
results show the full impact of the Our people are extraordinary —
Delta and Omicron lockdowns and and it’s wonderful to see them back
border closures across Australia doing the jobs they love. As the
and around the world, supressing Qantas Group has always done when
travel for much of the year. However, we’re able, we’re sharing the benefits
what they don’t capture is the of the recovery with our employees,
resilience of our people, the agility including offering around $10,000
and capability of our operations, in incentives and share rights as
and the loyalty of our customers. we reach important milestones
in our recovery.

As the national carrier, Qantas is proud

of its role in supporting Australians
in times of crisis. Roughly half of
what is often classed as government
support received by Qantas during the
pandemic was, in fact, fee for service
to operate important flights on the
nation’s behalf. The remaining half
largely went direct to our people.
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In the past year, we operated more Since borders reopened and The impact of the pandemic on the
than 220 repatriation flights for restrictions around the world eased, Qantas Group has been staggering.
the Australian Government to bring millions of our customers have But the support of our people, our
people home, including from Buenos returned to flying. The restart hasn’t customers and our shareholders has
Aires, Chennai and Istanbul. We happened as smoothly as we would meant we’ve come through the other
also supported critical government have liked, with COVID-19 and the side stronger, more resilient and with
missions to repatriate Australians winter flu season driving increases great plans for the future.
fleeing civil unrest in Afghanistan, in sick leave of around 50 per cent.
with 16 flights between Dubai All airlines have faced similar issues.
and Australia. We’ve apologised to our customers
for falling short of their expectations
Additionally, the Group conducted
as we managed through those Alan Joyce AC
more than 2,000 freight charters
challenges. Our performance has
under the International Freight
continued to get better and better,
Assistance Mechanism, uplifting
and everyone across the Qantas
almost 33,000 tonnes of freight
Group is working to get the airline
to keep Australian businesses
back to its best.
connected to international
markets and transport millions In the past 12 months, we added
of doses of COVID-19 vaccine. more than 20 new routes to our
domestic network to meet customer
I’m incredibly proud of the role our
demand. We also restarted flights to
people have played in supporting
19 international ports and announced
Australian businesses during the
eight new international routes.
pandemic, protecting hundreds of
We’re investing in new and more
thousands of jobs across Australia
efficient aircraft, new lounges and
and keeping vital trade links open.
new technology to making flying
even easier and more enjoyable for
our customers.
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Supporting Australian Businesses

As the Australian Government’s International Freight The entire Qantas team have significantly contributed
Assistance Mechanism (IFAM) draws to a close, we would to IFAM’s success in supporting Australian businesses
like to express our sincere appreciation to Qantas for through extraordinarily challenging times.
your partnership.
Your support has enabled IFAM to reconnect Australia’s
crucial global supply chains that collapsed as a result
of the COVID-19 pandemic. Air Vice-Marshal Marg Staib, AM, CSC
Australian Government Freight Controller
Maintaining air connectivity has retained Australia’s
reputation as a reliable global trading partner and
preserved the economic future of many of our farmers,
fishermen and primary producers. Michael Byrne
IFAM has helped to protect 35,000 direct jobs and 120,000 International Freight Co-ordinator General
indirect jobs in these industries, as well as aviation and logistics
Excerpts from Australian Trade and Investment Commission letter
services, which were dependent on airfreight supply chains. to Alan Joyce, 27 July 2022

DURING THE YEAR

On outbound IFAM charter Around 2.9 million kilograms Around 3 million kilograms
flights, the Qantas Group of meat of salmon
uplifted goods such as:
Around 1.9 million kilograms Around 1.3 million kilograms
of mail of fruit and vegetables

Similarly, on inbound IFAM Around 7.3 million kilograms Around 0.9 million kilograms
charter flights, the Qantas of general freight of fruit and vegetables
Group uplifted goods such as:
Around 3.9 million kilograms Around 0.4 million kilograms
of electronic goods of clothing

Around 0.6 million kilograms

of mail

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Board of Directors

RICHARD GOYDER AO ALAN JOYCE AC

BCom, FAICD BSc, MSc, MA, FRAeS, FTSE
Chairman and Independent Chief Executive Officer and Managing
Non-Executive Director Director
Richard Goyder was appointed to Alan Joyce was appointed Chief
the Qantas Board in November 2017 Executive Officer and Managing
and as Chairman in October 2018. Director of Qantas in November 2008.
He is Chair of the Nominations He is a Member of the Safety, Health,
Committee. Environment and Security Committee.
Mr Goyder is Chairman of Woodside Mr Joyce is a Director of the Business
Energy Group Ltd, the Australian Council of Australia, and the Museum
Football League Commission, the West of Contemporary Art Australia. He
Australian Symphony Orchestra, and is also a Director of a number of
the Channel 7 Telethon Trust. He is controlled entities of the Qantas Group.
an honorary Member of the Business Between June 2009 and October
Council of Australia and a Fellow of 2021, Mr Joyce was a Member of the
the AICD. International Air Transport Association’s
Mr Goyder was the Managing Director Board of Governors, having served as
and CEO of Wesfarmers Limited from Chairman from 2012 to 2013.
July 2005 to November 2017. He also He was also the Chief Executive
previously held the roles of Finance Officer of Jetstar from 2003 to 2008.
Director between 2002 and 2004, Before that, he spent over 15 years in
and Deputy Managing Director and leadership positions with Aer Lingus,
CFO between 2004 and 2005. Ansett and Qantas.
Mr Goyder was also formerly Chairman At both Qantas and Ansett, he led the
of the Australian B20 (the key business network planning, schedules planning
advisory body to the World Economic and network strategy functions.
Forum that includes business Prior to that, Mr Joyce spent eight
leaders from all G20 economies) years at Aer Lingus, where he held
and JDRF Australia. roles in sales, marketing, IT, network
Age: 62 planning, operations research, revenue
management and fleet planning.
Age: 56

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Board of Directors continued

MAXINE BRENNER JACQUELINE HEY BELINDA HUTCHINSON AC

BA, LLB BCom, Grad Cert (Mgmt), GAICD BEc, FCA, FAICD
Independent Non-Executive Director Independent Non-Executive Director Independent Non-Executive Director
Maxine Brenner was appointed to the Jacqueline Hey was appointed to the Belinda Hutchinson was appointed to
Qantas Board in August 2013. Qantas Board in August 2013. the Qantas Board in April 2018.
She is a Member of the Remuneration She is Chair of the Remuneration She is Chair of the Audit Committee, a
Committee and the Audit Committee. Committee, a Member of the Audit Member of the Nominations Committee
Ms Brenner is a Director of Origin Committee, and a Member of the and a Member of the Safety, Health,
Energy Limited, Orica Limited and Nominations Committee. Environment and Security Committee.
Woolworths Group Limited. She is a Ms Hey is Chair of Bendigo and Ms Hutchinson is currently Chancellor
Member of the Council of the University Adelaide Bank Limited, and a Director of the University of Sydney and
of New South Wales. of the Commonwealth Superannuation Chairman of Thales Australia.
Ms Brenner was formerly a Managing Corporation. Ms Hutchinson was also Chairman
Director of Investment Banking at Ms Hey was also formerly a Director of of the Future Generation Global
Investec Bank (Australia) Limited. She AGL Energy Limited from 2016 to 2022, Investment Company between May
has extensive experience in corporate Cricket Australia from 2012 to 2020, 2015 and June 2021.
advisory work, particularly in relation the Australian Foundation Investment She has over 30 years’ experience
to mergers and acquisitions, corporate Company Limited from 2013 to 2019, in the financial services sector,
restructures and general corporate Melbourne Business School from 2013 working in senior roles at Citibank
activity. She also practised as a lawyer to 2018, the Special Broadcasting and Macquarie Group. Ms Hutchinson
with Freehill Hollingdale & Page (now Service from 2011 to 2016, and a also has extensive board experience.
Herbert Smith Freehills), where she Member of the ASIC Directory Advisory She was formerly Chairman of QBE
specialised in corporate work, and Panel from 2013 to 2016. Insurance Limited, a Director of Telstra
spent several years as a lecturer in the Between 2004 and 2010, Ms Hey was Corporation Limited, Coles Group
Faculty of Law at both the University of Managing Director of various Ericsson Limited, Crane Group Limited, Energy
NSW and the University of Sydney. entities in Australia and New Zealand, Australia Limited, TAB Limited, Snowy
Ms Brenner was the Deputy Chair of the United Kingdom, Ireland, and Hydro Trading Limited, Sydney Water
the Federal Airports Corporation and the Middle East. Ericsson is a global and AGL Energy.
a Director of Neverfail Springwater technology and telecommunications Ms Hutchinson was awarded a
Limited, Bulmer Australia Limited, company, headquartered in Sweden. Companion of the Order of Australia
Treasury Corporation of NSW and Her executive career with Ericsson (AC) in 2020 in recognition of her
Growthpoint Properties Australia spanned more than 20 years, in which service to business, tertiary education
Limited. She also served as a Member she held finance, marketing, sales and scientific research, and for her
of the Australian Government’s and leadership roles. philanthropic endeavours to address
Takeovers Panel. Age: 56 social disadvantage.
Age: 60 Age: 69

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Board of Directors continued

MICHAEL L’ESTRANGE AO TODD SAMPSON ANTONY TYLER

BA (Syd), MA (Oxon) MBA, BA(Hons) BA (Jurisprudence)
Independent Non-Executive Director Independent Non-Executive Director Independent Non-Executive Director
Michael L’Estrange was appointed to Todd Sampson was appointed to the Antony Tyler was appointed to the
the Qantas Board in April 2016. Qantas Board in February 2015. Qantas Board in October 2018.
He is a Member of the Remuneration He is a Member of the Remuneration He is Chair of the Safety, Health,
Committee, and a Member of the Committee and a Member Environment and Security Committee
Safety, Health, Environment and of the Audit Committee. and a Member of the Nominations
Security Committee. Mr Sampson was Executive Chairman Committee.
Mr L’Estrange was Head of the National of the Leo Burnett Group from Mr Tyler was Director General and
Security College at the Australian September 2015 to January 2017, and Chief Executive of the International
National University from 2009 to 2015. National Chief Executive Officer from Air Transport Association from 2011 to
Prior to this, he was the Secretary of 2008 to 2015. He was also a Director 2016. Prior to this, Mr Tyler spent over
the Department of Foreign Affairs and of Fairfax Media Limited from 2014 to 30 years with Cathay Pacific Airways
Trade for almost five years, and the 2018. Limited. His career includes several
Australian High Commissioner to the Mr Sampson has over 20 years’ management and executive roles
UK between 2000 and 2005. He served experience across marketing, in Hong Kong, the UK, Italy, Japan,
as Secretary to Cabinet, and was Head communication, new media and digital Canada, the Philippines and Australia,
of the Cabinet Policy Unit from 1996 for transformation. He has held senior before serving in the role of Chief
more than four years. Prior to that, he leadership and strategy roles for a Executive Officer from 2007 to 2011.
was Executive Director of the Menzies number of leading communication He is a Non-Executive Director of
Research Centre. companies in Australia and overseas, Bombardier Inc, BOC Aviation Limited
Mr L’Estrange was also a Non-Executive including as Managing Partner and Trans Maldivian Airways Limited
Director of Rio Tinto plc and Rio Tinto for D’Arcy, Strategy Director for and a Fellow of the Royal Aeronautical
Limited between September 2014 and The Campaign Palace, and Head of Society.
May 2021. Strategy for DDB Needham Worldwide. Age: 67
He has been a Director of the University Age: 52
of Notre Dame, Australia, since 2014
and was appointed Deputy Chancellor
of the University of Notre Dame,
Australia, in 2017.
Mr L’Estrange studied at the University
of Sydney and later as a Rhodes
Scholar at Oxford University, where he
graduated with a Master of Arts with
First Class Honours.
Age: 69

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 QANTAS ANNUAL REPORT 2022

Review of Operations
For the year ended 30 June 2022

RESULTS HIGHLIGHTS

Underlying (Loss)/Profit Before Tax Statutory (Loss)/Profit After Tax Return on Invested Capital

(1,859) (860) (31.6)

$M $M %

(1,859) FY22 (1,859) (860) FY22 (860) (31.6%) FY22 (31.6%)

(1,774) FY21 (1,774) (1,692) FY21 (1,692) (21.4%) FY21 (21.4%)
124 FY20 124 (1,964) FY20 (1,964) 5.8% FY20 5.8%
1,326 FY19 1,326 840 FY19 840 19.2% FY19 19.2%

For the financial year 2021/22, the operations of the Qantas Group continued to be impacted by the global COVID-19 pandemic. The
performance of the Group and individual segments have been compared to the corresponding prior period (financial year 2020/21) and the
financial year 2018/19, which represents a proxy for ‘pre-COVID’ operations.1 This indicates the degree to which the Group’s performance is
recovering to pre-COVID levels as the 2018/19 financial year represents the most recent complete financial period not affected by the
pandemic.
Border restrictions and lockdowns due to both the Delta and Omicron variants of COVID-19 limited mobility and impacted consumer
confidence and Group operations throughout the year. This resulted in a Statutory Loss Before Tax for the Group of $1.19 billion. Since the start
of the pandemic the Group has lost approximately $25 billion in revenue and accumulated $7 billion in losses.
Lockdowns responding to the emergence of the Delta variant of COVID-19 started in July 2021, resulting in the closure of domestic borders for
much of the first half. During this period, domestic airlines suffered stranded costs because of the sudden implementation of restrictions.
From November 2021, domestic borders were progressively reopened, supported by Australia’s vaccination program. International borders
continued to be closed for much of the first half of 2022, with Australia only reopening in selected states from November. This was the first
time Australian citizens were able to freely travel overseas since March 2020. From December 2021, just as travel appeared to be resuming,
outbreaks of the new Omicron variant emerged. These became widespread and impacted travel in the third quarter as the uptick in cases
delayed re-opening and return to office activities.
From March 2022, domestic restrictions, including office mask mandates, began to ease. At this point the Group saw a rapid return in travel,
with domestic operations recovering to pre-COVID levels by the fourth quarter. Recovery of international passenger operations was slower,
constrained by ongoing restrictions in key markets, delays in delivery of B787s and the lead time required to safely return the fleet of A380s
from long-term storage. Pent-up demand was particularly evident in markets with open borders and minimal travel restrictions. The demand
strength drove booking intakes, with revenue received in advance rebuilding considerably. Together with the sale of surplus land in Mascot for
$789 million in net proceeds, the Group saw Net Debt reduce below the target range to $3.94 billion by 30 June 2022.
At an Underlying EBITDA level, the Qantas Group reported a $281 million profit, down $129 million compared to financial year 2020/21.
Contributing to the result were readiness and restart costs as the Group’s operations came out of hibernation and prepared for a return of
capacity in calendar year 2022. Readiness activities included the significant decision in December 2021 to stand up and return all Australian-
based employees who had been stood down during the pandemic. In the second half, the rapid recovery of operations resulted in stronger
earnings performance, particularly in quarter four. This resulted in an Underlying EBITDA of $526 million for the second half of the year.
While the reopening of borders led to a significant increase in travel demand, the Group and its industry peers experienced significant
operational challenges. Record levels of sick leave from COVID-19, difficulties in recruitment due to tight labour markets and a surge in
demand impacted airline performance globally. Airports have faced similar challenges, with some, such as London Heathrow, implementing
operating restrictions on airlines.
In Australia, unique circumstances complicated the return of travel. In the second half of the year, the winter period experienced a ‘double
peak’ of influenza and COVID-19 infections, resulting in significant levels of sick leave, particularly seven-day isolation requirements,
affecting airlines, airports, ground handlers and air traffic control. A lack of migration slowed recruitment and unusually poor weather also
played a role, with runway capacity limitations at key Australian ports.
The Qantas Group has taken steps to restore operational performance. During the year, contact centre resources were increased, with
average wait times returning to below pre-COVID levels by June 2022. The Group recruited 1,500 employees (primarily in operational roles),
worked closely with suppliers to ensure sufficient labour supply, and built increased resilience into flying schedules. It also temporarily
increased employees on reserve, raising the coverage ratio in critical operational workgroups. The Group will continue to manage capacity,
recruitment and training and invest in operations as it returns to its normal industry-leading service levels.

1
The Group adopted International Financial Reporting Interpretations Committee (IFRIC) agenda decision in relation to Cloud Computing (“IFRIC Cloud Computing decision”)
retrospectively. The comparative period presented has been restated accordingly. Refer to Note 39 for further information. However, the results for the financial years 2019/20 and
2018/19 have not been restated.

12
 QANTAS ANNUAL REPORT 2022

Review of Operations continued

For the year ended 30 June 2022

RESULTS HIGHLIGHTS (CONTINUED)

The Underlying Loss Before Tax2 (Underlying LBT) was ($1,859) million for financial year 2021/22, a decrease of $3,185 million compared to
financial year 2018/19 pre-COVID (increased loss of $85 million compared to financial year 2020/21). The Group’s Statutory Loss Before Tax
of ($1,191) million was adverse $2,383 million from financial year 2018/19 pre-COVID (improved $1,108 million compared to financial year
2020/21). The Statutory Loss Before Tax for the 2021/22 financial year included a net gain on sale of $686 million as a result of the sale of
surplus Mascot land.
Group total revenue was $9,108 million, down $8.9 billion or 49 per cent compared with financial year 2018/19 pre-COVID (up $3.2 billion or 53
per cent compared to financial year 2020/21). Operating expenses3 have reduced by 38 per cent compared with financial year 2018/19 pre-
COVID. This has driven the Group’s Recovery Plan, which delivered restructuring benefits of $920 million by 30 June 2022. The Group is on
track to deliver $1 billion in structural benefits by financial year 2022/23.
Over the period, the Group’s Domestic airlines flew 63 per cent of their pre-COVID network. While Group Domestic saw an Underlying EBITDA
loss of ($194) million for financial year 2021/22, the rapid recovery in demand and full return of domestic operations to pre-COVID levels
resulted in Group Domestic Underlying EBIT being positive in the fourth quarter. The Group’s International operations contributed an
Underlying EBITDA of $167 million for financial year 2021/22, with Qantas Freight continuing to provide a natural hedge for decreased
passenger flying and delivering a record performance in the year. This was underpinned by record international freight yields due to
constrained freight belly space and continued growth in e-commerce penetration in Australia. The resilience of the Qantas Loyalty business
continued as it generated a third consecutive year of gross cash billing above $1 billion and Underlying EBITDA of $351 million for financial
year 2021/22 (Underlying EBIT of $292 million). The contributions of Qantas Freight and Qantas Loyalty during the COVID-19 period continue
to demonstrate the benefits of the diversified portfolio of businesses that the Group has built.
Key financial metrics for the 2021/22 financial year include:
– Statutory Earnings Per Share loss of 45.6 cents per share
– Operating cash flow of $2,670 million, driven by strong rebuild of passenger revenue received in advance
– Net capital expenditure4 of $398 million reflecting primarily capitalised maintenance activity offset by proceeds from the sale of surplus
land
– Positive Statutory Net Free Cash Flow5 of $2,430 million
– Net Debt reduced to $3.94 billion as at 30 June 2022.
The Australian Government implemented various programs to support businesses and employees severely affected by the pandemic.
Programs which provided direct support to employees or offset costs of the Group included:
– International Aviation Support (IAS) Package, including the International Readiness Payment (IRP) provided as support to employees
– Retaining Domestic Airline Capability (RDAC), including a portion provided as support to employees.
Details on these Australian Government programs can be found in Note 24 of the Financial Report.
The Group provided vital services to conduct various charter repatriation flights to return Australians home. Along with other Australian
domestic airlines, the Group performed domestic and regional flights as part of the Regional Airline Network Support (RANS) and Domestic
Aviation Network Support (DANS) programs to maintain vital air transport links during the pandemic. It also participated in the Tourism
Aviation Network Support (TANS) scheme, which offered discounted fares to key tourist regions in Australia. Qantas Freight was contracted to
conduct freight services under the International Freight Assistance Mechanism (IFAM), operating 2,000 IFAM charters and moving
approximately 32,000 tonnes of freight to ensure critical export freight routes remained open. The majority of these programs ended during
the financial year, with IFAM concluding in June 2022.
Given ongoing COVID-19 disruptions, the Group continued to maintain a prudent stance to funding and liquidity. During the year, $491 million
in new debt funding was raised and $1,441 million of debt was repaid. This included a prepayment of $450 million in secured debt raised
during COVID-19, which released unencumbered aircraft back to the balance sheet. The Group remains on track to achieve its revised target
of reducing gross debt by $1.3 billion under its Recovery Plan. The Group also continued to maintain access to undrawn liquidity facilities
totalling $1.3 billion, with maturities extended to financial year 2023/24, financial year 2025/26 and financial year 2026/27.
At 30 June 2022, cash and cash equivalents totalled $3.3 billion with total liquidity at $4.6 billion, including $1.3 billion in committed undrawn
facilities. The Group also maintains an unencumbered asset base of more than $3.5 billion. This ensures that the Group has significant
financial flexibility to manage throughout various operating conditions.

2
Underlying Loss/Profit Before Tax (Underlying LBT/PBT) is the primary reporting measure used by the Qantas Group’s Chief Operating Decision-Making bodies (CODM), being the Chief
Executive Officer, Group Management Committee and the Board of Directors, for the purpose of assessing the performance of the Group. The primary reporting measure of the Qantas
Domestic, Qantas International, Jetstar Group and Qantas Loyalty operating segments is Underlying Earnings Before Net Finance Costs and Income Tax Expense (Underlying EBIT).
The primary reporting measure of the Corporate segment is Underlying PBT as net finance costs are managed centrally. Refer to the reconciliation of Underlying LBT/ PBT to Statutory
(Loss)/Profit Before Tax on page 23.
3
Group gross underlying expenditure excluding depreciation and amortisation, impairment/(reversal of impairment) of assets and related costs, share of net loss/(profit) of
investments accounted for under the equity method and discount rate changes impact on provisions.
4
Net capital expenditure is equal to net investing cash flows in the Consolidated Cash Flow Statement and the impact to Invested Capital from the disposals/acquisitions of leased
aircraft.
5
Net cash from operating activities less net cash used in investing activities.

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Review of Operations continued

For the year ended 30 June 2022

RESULTS HIGHLIGHTS (CONTINUED)

At the end of financial year 2021/22, Net Debt6 was $3.94 billion, below the Financial Framework optimal Net Debt target range of $4.2 billion
to $5.2 billion. The reduction over the year was driven by Recovery Plan benefits, the surplus land sale in the first half of the year and a strong
rebuild of revenue received in advance. In May 2022, the Group, which is one of only six airlines to retain an investment grade credit rating
during the COVID-19 period, received an upgrade to its Baa2 rating from Moody’s Investor Services, with the outlook moving from ‘negative’ to
‘stable’.

THREE-YEAR RECOVERY PLAN

l Complete
¡ On track

Financial Financial Financial

year year year
Focus area Target 2020/21 2021/22 2022/23 Status
Cash flow Sustainable positive Net Free Cash Flow
l Achieved – three consecutive quarters of Net Free Cash
Flow in financial year 2021/22

~$0.75 billion capex for financial year 2020/21

l Complete

Fleet
management
Defer deliveries of A321neo and 787-9 aircraft
l Complete

Retire 6 x 747s and hibernate A380s

l Complete

Qantas Loyalty Return to double digit growth by calendar year 2022

l Achieved – 12 per cent growth from 2H21 to 2H22

Deleverage the
balance sheet
Gross debt reduction of $1.3 billion by financial year
2022/237
¡ On track

Net Debt/EBITDA < 2.5 times by financial year

2022/23
¡ On track

Cost savings 8,500 exits by financial year 2020/21 (9,800 exits by

financial year 2021/22) l l Complete – ~9,800 exits

Restructuring cost benefits of $0.6 billion in financial

year 2020/21, $0.8 billion by financial year 2021/22, l l ¡ On track – $1 billion in cost benefits expected by
financial year 2022/23 with all initiatives now
$1 billion by financial year 2022/23 commenced and greater than 90 per cent of initiatives
completed; $920 million delivered at the end of
financial year 2021/22

FY23 Group Unit Cost (excluding fuel and

depreciation) 10 per cent less than financial year
¡ On track

2019/20
Customer, brand Maintain customer advocacy (NPS) premium to
and employee domestic competitor l l ¡ On track – NPS at a premium to domestic competitor
although impacted by operational issues; initiatives in
engagement place to improve
Maintain brand and reputation
l l Recovery
Long-term brand preference metrics have remained
stable despite operational disruptions
plan in
Employee sentiment
l l progress Operational issues have impacted employee sentiment,
with initiatives in place to improve

The Recovery Plan delivered $920 million in savings since the start of the program. It is on track to deliver $1 billion by the end of financial
year 2022/23, with all initiatives now commenced and over 90 per cent completed. Consistent with long-standing practice, the Group is also
committed to offsetting CPI costs through additional transformation comprising both cost and revenue initiatives.

6
Net Debt under the Group’s Financial Framework includes net on balance sheet debt and capitalised aircraft lease liabilities.
7
Resized in line with forecast earnings and cash liquidity levels, with competitive cost of existing debt in rising interest rate environment.

14
 QANTAS ANNUAL REPORT 2022

Review of Operations continued

For the year ended 30 June 2022

FINANCIAL FRAMEWORK ALIGNED WITH SHAREHOLDER OBJECTIVES

Qantas’ Financial Framework aligns our objectives with those of our shareholders. With the launch of the Qantas Group Climate Action Plan in
March 2022, an Environmental, Social and Governance (ESG) perspective has now been incorporated into the Financial Framework, with the
aim of targeting industry-leading ESG credentials and a maintainable Earnings Per Share (EPS) growth over the cycle. This reflects the
importance of ESG considerations in the Group’s target of achieving Total Shareholder Returns (TSR) in the top quartile of the ASX100 and
among a basket of global airlines.8 The Financial Framework is built on three clear priorities and associated long-term targets:
1. Maintaining an Optimal Capital Structure 2. ROIC > WACC10 Through the Cycle 3. Disciplined Allocation of Capital
Minimise cost of capital by targeting Deliver ROIC > 10 per cent11 Grow Invested Capital with disciplined
a Net Debt range of $4.2 billion to $5.2 billion9 investment and return surplus capital

Deliver against Climate Action Plan Targets ESG included in all business decisions Prioritise projects that exceed both ESG and ROIC
targets

x9,10,11
INDUSTRY-LEADING ESG CREDENTIALS | MAINTAINABLE EPS GROWTH OVER THE CYCLE

TOTAL SHAREHOLDER RETURNS IN THE TOP QUARTILE

Maintaining an Optimal Capital Structure
The Group’s Financial Framework targets an optimal capital structure to achieve the lowest cost of capital. This results in a Net Debt target
range of $4.2 billion to $5.2 billion, based on the average Invested Capital for the 12 months ending 30 June 2022 of $4.9 billion. The range
is based on a Net Debt/ROIC EBITDA range of 2.0-2.5 times where ROIC is fixed at 10 per cent. This capital structure optimises the Group’s
cost of capital and preserves financial strength with the objective of enhancing long-term shareholder value. The Group’s optimal capital
structure is consistent with investment grade credit metrics and the Group maintains an investment grade Baa2 rating with Moody’s
Investor Services.
At 30 June 2022, Net Debt was $3.94 billion, below the Net Debt target range.

Net Debt Profile FY19 to FY22 ($ billion)

5.6 5.2 5.9

4.9 4.7 4.7 3.9

FY16 FY17 FY18 FY19 FY20 FY21 FY22

Net Debt ($B) Target range

ROIC > WACC Through the Cycle

Return on Invested Capital (ROIC) for the 12 months to 30 June 2022 was (31.6%), below the Group’s target for value creation of 10 per cent.
This was due primarily to the impact of COVID-19 on earnings, including government-imposed travel restrictions and border closures.

Disciplined Allocation of Capital

The Qantas Group takes a disciplined approach to allocating capital, with the aim to grow Invested Capital and return surplus capital to
shareholders where forward-looking earnings permit. Upon considering the forward outlook for the business and the restoration of financial
strength under its Financial Framework, the Board has resolved to announce an on-market buyback up to the value of $400 million.

Maintainable EPS Growth Over the Cycle

Statutory Earnings Per Share was a loss of (45.6) cents per share due to the significant Statutory Loss After Tax.

8
Target Total Shareholder Returns within the top quartile of the ASX100 and the global listed airline peer group as stated in the 2021 Annual Report, with reference to the 2021-2023
Long Term Incentive Plan (LTIP).
9
Based on Invested Capital of $4.9 billion as at 30 June 2022.
10
Weighted Average Cost of Capital, calculated on a pre-tax basis.
11
Target of greater than 10 per cent ROIC allows ROIC to be greater than pre-tax WACC through the cycle.

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 QANTAS ANNUAL REPORT 2022

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For the year ended 30 June 2022

GROUP PERFORMANCE
The Underlying Profit Before Tax for the 2021/22 financial year was a loss of ($1,859) million compared with an Underlying Profit Before Tax of
$1,326 million in financial year 2018/19 pre-COVID and a loss of ($1,774) million in financial year 2020/21. Net passenger revenue declined by
62 per cent compared to financial year 2018/19 pre-COVID levels as the domestic airlines operated at 63 per cent of pre-COVID capacity and
the international scheduled passenger businesses operated at only 17 per cent of pre-COVID capacity. Net freight revenue increased due to a
surge in e-commerce and a significant reduction in available international belly space, driving yields higher. Other revenue declined primarily
due to decreased third-party service revenues.
June 2022 June 2021 June 2019
(restated) (pre-COVID)13
Group Underlying Income Statement Summary12 $M $M $M
Net passenger revenue 5,951 3,766 15,696
Net freight revenue 1,963 1,316 971
Other 1,194 852 1,299
Revenue 9,108 5,934 17,966
Operating expenses (excluding fuel)12 (6,853) (4,560) (10,599)
Fuel (1,848) (835) (3,846)
Impairment12 (38) (13) —
Depreciation and amortisation12 (1,801) (1,870) (1,936)
Share of net (loss)/profit of investments accounted for under the equity method (126) (129) 23
Total underlying expenditure (10,666) (7,407) (16,358)
Underlying EBIT (1,558) (1,473) 1,608
Net finance costs (301) (301) (282)
Underlying PBT (1,859) (1,774) 1,326
13

June 2021 June 2019

Operating Statistics June 2022 (restated) (pre-COVID)
Available Seat Kilometres (ASK)14 M 50,633 29,374 151,430
Revenue Passenger Kilometres (RPK)15 M 34,363 18,557 127,492
Passengers carried 000 21,257 15,866 55,813
Revenue Seat Factor16 % 67.9 63.2 84.2
Operating Margin17 % (17.1) (24.8) 9.0
Unit Revenue (RASK)18 c/ASK 9.48 9.72 8.85
Total Unit Cost19 c/ASK (13.16) (15.76) (7.97)
Group capacity for the year (ASK) decreased by 67 per cent compared to financial year 2018/19 pre-COVID. Revenue Passenger Kilometres
decreased by 73 per cent compared to financial year 2018/19 pre-COVID due to lower capacity levels and the Group’s Revenue Seat Factor
falling to 68 per cent. Group Unit Revenue increased to 9.48 c/ASK due to the increased weighting of domestic to international revenue
compared to pre-COVID. The Group’s Total Unit Cost increased to 13.16 c/ASK as a result of the Group’s fixed cost base, including depreciation
and amortisation being spread across a significantly lower number of ASKs compared to financial year 2018/19 pre-COVID.

12
Underlying expenses differ from equivalent statutory expenses due to items excluded from Underlying PBT such as those items identified by Management as not representing the
underlying performance of the business. Refer to the reconciliation on page 23.
13
The Group adopted the IFRIC agenda decision in relation to Cloud Computing (“IFRIC Cloud Computing decisions”) retrospectively. June 2019 (pre-COVID) has not been restated. Refer
to Note 39 for further information.
14
ASK – total number of seats available for passengers, multiplied by the number of kilometres flown.
15
RPK – total number of passengers carried, multiplied by the number of kilometres flown.
16
Revenue Seat Factor – RPKs divided by ASKs. Also known as seat factor, load factor or load.
17
Operating Margin is Group Underlying EBIT divided by Group total revenue.
18
Unit Revenue (RASK) is calculated as ticketed passenger revenue divided by Available Seat Kilometres (ASK).
19
Total Unit Cost is Underlying PBT less ticketed passenger revenue per ASK.

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 QANTAS ANNUAL REPORT 2022

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For the year ended 30 June 2022

CASH GENERATION
June June
2022 2021 Change Change
Cash Flow Summary $M $M $M %
Operating cash flows 2,670 (386) 3,056 792
Investing cash flows (240) (722) 482 67
Net Free Cash Flow 2,430 (1,108) 3,538 319
Financing cash flows (1,310) (181) (1,129) (624)
Cash at the beginning of the year 2,221 3,520 (1,299) (37)
Effect of foreign exchange on cash 2 (10) 12 120
Cash at the end of the year 3,343 2,221 1,122 51

June June
2022 2021 Change Change
Debt Analysis $M $M $M %
Net on balance sheet debt20 $M 2,617 4,609 (1,992) (43)
Capitalised operating lease liabilities21 $M 1,320 1,281 39 3
22
Net Debt 3,937 5,890 (1,953) (33)
Operating cash outflows for financial year 2021/22 were $2,670 million, with the rebuild of Revenue Received in Advance and continued
strength in Freight and Loyalty billings generating significant positive cash flow.
Investing cash outflows for financial year 2021/22 were $240 million, with gross cash outflows of ($1,041) million offset by the proceeds from
the sale of land at Mascot and other assets of $801 million. Net capital expenditure23 was $398 million, including the impact of capitalised
aircraft leases relating to Embraer E190s and Boeing 747 freighters in the Group’s Financial Framework. Capital expenditure was primarily
directed to capitalised maintenance.
Net financing cash outflows of ($1,310) million included a $491 million drawdown of debt offset by debt repayments of $1,441 million and
$360 million in net aircraft, non-aircraft lease repayments and other financing cash outflows.
At 30 June 2022, the Group’s unencumbered asset base was greater than $3.5 billion,24 including 49 per cent of the Group’s fleet25 as well as
spare engines and other assets.
Qantas continues to retain significant flexibility in its financial position, funding strategies and fleet plan to ensure that it can respond
to changes in market conditions and earnings scenarios.

20
Net on balance sheet debt includes interest-bearing liabilities reduced by cash and cash equivalents.
21
Capitalised aircraft lease liabilities are a non-statutory measure. They are measured at fair value at the lease commencement date and remeasured over the lease term on a principal
and interest basis. Residual value of capitalised aircraft lease liability denominated in foreign currency are translated at a long-term exchange rate.
22
Net Debt is a non-statutory measure. It includes on balance sheet debt and capitalised aircraft lease liabilities under the Group’s Financial Framework.
23
Net capital expenditure is equal to net investing cash flows in the Consolidated Cash Flow Statement and the impact to Invested Capital from the disposals/acquisitions of leased
aircraft.
24
Aircraft valuations based on the average of AVAC market values as at 30 June 2022.
25
Based on number of aircraft as at 30 June 2022. The Group’s fleet totalled 322 aircraft, including Jetstar Asia (Singapore) owned fleet and excluding Jetstar Japan.

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 QANTAS ANNUAL REPORT 2022

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For the year ended 30 June 2022

FLEET
The Group’s strategic priorities for fleet planning are centred on three key principles: the right aircraft for the right route, maintaining flexibility
and maintaining competitiveness. The determination of the optimal fleet plan balances a number of factors, including the availability of new
technology, the level of capacity growth required in the markets, the competitive landscape and whether the investment is earnings
accretive. At all times, the Group retains significant flexibility in its fleet to respond to changes in market conditions through fleet
redeployment, refurbishment, lease extension or return and retirement.
With the launch of its Climate Action Plan in March 2022, the Group has more formally integrated ESG considerations into its fleet planning. As
part of its plan to reduce net emissions by 25 per cent by 2030 and to net zero by 2050, the Group has an average 1.5 per cent per annum
operational fuel efficiency target, with fleet renewal being a key driver. In addition, the integration of ESG into the Financial Framework means
new fleet investments are factoring the expected future cost of carbon through an internal carbon price. Further details will be available as
part of the Qantas Sustainability Report to be released in September 2022.
During financial year 2021/22, one A320-200 was transferred from Jetstar Australia to QantasLink to support the growing resource market,
two Jetstar Group A321ceos were converted to freighter aircraft to support Qantas Freight, one A320-200 from Jetstar Asia was returned to
the lessor and four of Jetstar Japan’s A320-200 aircraft (not included in the fleet summary below) were repositioned to Australia to support
Jetstar Domestic. Qantas International also announced that two A380s in storage would not return to operations.
The Group also announced two significant fleet investment programs during the year. Domestically, Qantas will start the renewal of its narrow
body jet fleet with firm orders for 20 Airbus A321XLRs and 20 A220-300s to replace its Boeing 737s and 717s as they are retired. The first of
these will arrive in 2023 and thereafter over the next decade. Combined with an existing Jetstar order with Airbus, the Group now has 299
narrow body aircraft, half of which are firm and half of which are purchase right options. Embedded contract flexibility allows either brand to
select any variant from the A320 and A220 families, providing significant planning flexibility.
In addition, the Group also confirmed its decision to proceed with ‘Project Sunrise’ and operate non-stop ultra-long-haul flights from Australia
to cities including New York and London. Qantas International has ordered 12 Airbus A350-1000 aircraft that will feature market-leading
passenger comfort in each travel class, with services from Sydney scheduled to start by the end of calendar year 2025.
All of these next generation aircraft, through their lower emissions, longer range, reduced noise and better economics, will improve how
customers travel around Australia and overseas.
At 30 June 2022, the Qantas Group fleet26 totalled 322 aircraft. The fleet summary includes 12 Embraer E190s and two Boeing 747 freighters
operated on the Group’s behalf by third parties, which have met the requirements of capitalised operating leases under the Group’s Financial
Framework.
June
June 2021
Fleet Summary (Number of Aircraft) 2022 (restated)27
A38028 10 12
A330-200/300 28 28
737-800 75 75
787-9 11 11
717-200 20 20
Q200/300/400 50 50
F100 18 18
A320-200 11 10
E190 12 4
Total Qantas (including QantasLink and Network Aviation) 235 228
A320/A321-200 65 67
787-8 11 11
Total Jetstar Group 76 78
737-300/400F 5 5
767-300F 1 1
A321-200P2F 3 3
747-8F29 2 0
Total Freight 11 9
Total Group 322 315

26
Includes Qantas Airways, Jetstar Australia and New Zealand, Jetstar Asia (Singapore), Qantas Freight and Network Aviation and excludes aircraft operated by Jetstar Japan.
27
2020/21 financial year has been restated to include the embedded lease and related financing of Embraer E190s. Group Fleet now includes embedded lease and related financing of
Embraer E190s and 747 Atlas Freighters as they have been recognised as debt in accordance with the Financial Framework. The Financial Framework recognises lease arrangements
that serve permanent capacity.
28
Of the fleet of 12 A380s in June 2021, 10 are expected to be returned to service. At 30 June 2022, three A380s are in service.
29
Two 747-8F operated as at 30 June 2022.

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For the year ended 30 June 2022

SEGMENT PERFORMANCE
June June
June 2021 2019
2022 (restated) (pre-COVID)
Segment Performance Summary $M $M $M
Qantas Domestic (765) (575) 778
Qantas International (238) (548) 323
Jetstar Group (796) (541) 400
Qantas Loyalty 292 272 376
Corporate (129) (98) (171)
Unallocated/Eliminations 78 17 (98)
Underlying EBIT (1,558) (1,473) 1,608
Net finance costs (301) (301) (282)
Underlying PBT (1,859) (1,774) 1,326

QANTAS DOMESTIC

Revenue Underlying EBITDA Operating Margin

3,448 (27) (22.2)

$M $M %

3,448 FY22 3,448 (27) FY22 (27) (22.2)% FY22 (22.2%)

2,745 FY21 2,745 159 FY21 159 (20.9)% FY21 (20.9%)
4,672 FY20 4,672 907 FY20 907 3.7% FY20 3.7%
6,098 FY19 6,098 1,503 FY19 1,503 12.8% FY19 12.8%

Metrics June 2022 June 2021 June 2019

ASKs M 21,233 16,951 33,866
Seat factor % 60.9 58.3 77.8
Qantas Domestic reported an Underlying EBITDA loss of ($27) million and an Underlying EBIT loss of ($765) million for the year.
The result was impacted by COVID-19 lockdowns, unwinding of COVID-19 relief measures and the restart of activities. Demand was impacted
by the Delta and Omicron outbreaks which delayed the full reopening of domestic borders until March 2022.
For the financial year 2021/22, Qantas Domestic operated 63 per cent of pre-COVID flying, returning to an average capacity of 98 per cent of
pre-COVID levels in the fourth quarter. Leisure demand continued to lead the recovery, with leisure revenue intakes significantly above pre-
COVID levels. Business purpose travel returned strongly in the fourth quarter, driven by resource and Small and Medium-sized Enterprise
(SME) demand. The recovery in demand saw a steady rise in seat factors, with seat factors reaching 74 per cent for the month of June 2022.
Qantas Domestic increased its number of routes to 132 at the end of the 2021/22 financial year supported by the growth of the E190 fleet to
12 aircraft operated by Alliance Airlines in a wet-lease arrangement. The Group also announced an agreement to acquire the remaining 80 per
cent of shares it does not already own in Alliance Aviation Services Ltd (ASX: AQZ), improving its ability to serve Western Australian and
Queensland resource customers. The agreement is subject to Australian Competition and Consumer Commission clearance and Alliance
shareholder approval.
As part of the wider Recovery Plan, Qantas Domestic has delivered approximately $450 million in annualised recovery cost benefits since the
start of the three-year program.
During the second half of the year, Qantas Domestic experienced operational challenges due to record sick leave and tight labour markets,
which coincided with a rapid recovery of demand as travel restrictions eased. These challenges resulted in cancellations, disrupted bags and
on time performance being below service standards. Steps have been taken to address performance, including recruitment and building
increased resilience in flying schedules. In addition, investments in customer initiatives such as streamlined self-service check-in kiosks and
improved contact centres were undertaken to support the return to travel.
Through its multi-gauge fleet, network breadth, frequency and superior product offering (including Wi-Fi and lounges), Qantas Domestic is
well-positioned to serve the premium segment of the domestic market.

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For the year ended 30 June 2022

QANTAS INTERNATIONAL

Revenue Underlying EBITDA Operating Margin

3706 448 (6.4)

$M $M %

3,706 FY22 3,706 448 FY22 448 (6.4%) FY22 (6.4%)

1,598 FY21 1,598 117 FY21 117 (34.3%) FY21 (34.3%)
6,077 FY20 6,077 846 FY20 846 0.9% FY20 0.9%
7,420 FY19 7,420 1,045 FY19 1,045 4.4% FY19 4.4%

Metrics June 2022 June 2021 June 2019

ASKs M 12,187 640 69,571
Seat factor % 75.4 42.8 86.0
Qantas International commenced its recovery as Australian travel restrictions eased, with freight operations continuing to act as a natural
hedge for the grounded passenger business. The result for the year was an Underlying EBITDA of $448 million on passenger capacity at 18 per
cent of pre-COVID levels. Underlying EBIT was a loss of ($238) million. Despite the challenging environment, the Recovery Plan focus
continued, with approximately $360 million in permanent cost benefits delivered by the end of the year.
Qantas International’s passenger business restarted late in the first half of the year. Routes to London, Los Angeles and Singapore opened
from November and were part of 19 ports restarted during the year. As the business mobilised quickly, it was able to capture high levels of
pent-up demand where borders opened earlier than expected. This also extended to new opportunities, with eight new routes announced
including Sydney and Melbourne to Delhi, Perth to Rome and Sydney to Seoul.
Overall International market capacity was slow to return due to border closures in some markets, aircraft availability due to manufacturer
delays and long lead times to return aircraft from COVID-19 storage. This impacted numerous airlines and resulted in market capacity lagging
behind demand. In this environment, international passenger yields rose strongly, providing an important offset to the significant increase in
jet fuel prices seen during the quarter.
Freight continued to offset the losses of the International passenger operations and played an important role in the IFAM program, providing
critical flights to Australian suppliers to keep export markets open. The performance in Freight was driven by strong international yields
resulting from constrained belly space availability. Combined with surging e-commerce demand, this drove Freight to a record performance
for the full year. Underpinned by the e-commerce trends, Qantas Freight announced plans to grow its fleet, with two existing A330 passenger
aircraft identified for freighter conversions. This adds to three A321 aircraft converted to freighters already in operation. Subsequent to year
end the Group announced it will procure an additional six A321 freighters to replace several smaller ageing aircraft.
Building on its significant cost transformation, the full recovery of its flying by financial year 2023/24 and future initiatives like ‘Project
Sunrise’, the Qantas International business is well-positioned to capture demand for premium international travel.

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For the year ended 30 June 2022

JETSTAR GROUP

Revenue Underlying EBITDA Operating Margin

1,440 (448) (55.3)

$M $M %

1,440 FY22 1,440 (448) FY22 (448) (55.3%) FY22 (55.3%)

1,140 FY21 1,140 (129) FY21 (129) (47.5%) FY21 (47.5%)
3,006 FY20 3,006 426 FY20 426 (0.9%) FY20 (0.9%)
3,961 FY19 3,961 836 FY19 836 10.1% FY19 10.1%

Metrics June 2022 June 2021 June 2019

ASKs M 17,213 11,783 47,993
Seat factor % 71.2 71.3 86.1
The Jetstar Group reported an Underlying EBITDA loss of ($448) million and an Underlying EBIT loss of ($796) million.
All businesses relaunched operations, with all Jetstar Australia and New Zealand fleet deployed. All domestic and most international
destinations also restarted although key markets, like Bali, reopened late in the financial year. The recovery profile of Jetstar was similar to
Qantas, with domestic travel leading the international recovery.
Jetstar’s Australian Domestic business delivered an Underlying EBITDA loss of ($167) million. The result was impacted by reduced demand
primarily due to Delta and Omicron, stranded costs linked to sudden border restrictions, unwinding of COVID-19 relief measures and restart
costs. Earnings performance improved in the final quarter as restrictions eased and demand returned, with Jetstar’s Australian business
returning to Underlying EBITDA profit in the fourth quarter. Jetstar Group capacity for the year was 36 per cent of pre-COVID levels and the
average seat factor for the group was 71 per cent.
Jetstar Australia, New Zealand and Jetstar Asia (Singapore) international operations reported an Underlying EBITDA loss of ($157) million,
impacted by the slow return of key markets. The late opening of key markets saw RASK momentum improve in the final months of the year,
which was important to offset rising fuel prices. Jetstar Asia commenced flying on vaccinated travel lane routes in December 2021, providing
a connecting passenger feed onto Qantas International services in Singapore.
Jetstar Group’s result includes a ($124) million loss attributable to the share of statutory losses for Jetstar Japan. The operating environment
in Japan was particularly challenging and the loss included a ($52) million negative impact from the balance sheet revaluation of USD-
denominated aircraft leases due to a depreciation in the Yen against the US dollar.
Jetstar remains well-positioned to maintain a low fares advantage, with cost and scale advantages to its domestic competitors. From
financial year 2022/23, deliveries will commence for the first of 18 A321LR aircraft. This significant investment in new technology will lower
operating costs, reduce emissions and provide greater network reach, leaving the Jetstar Group well-placed to capitalise on the leisure-led
recovery.

21
QANTAS ANNUAL REPORT 2022

Review of Operations continued

For the year ended 30 June 2022

QANTAS LOYALTY

Revenue Underlying EBITDA Operating Margin

1,334 351 21.9

$M $M %

1,334 FY22 1,334 351 FY22 351 21.9% FY22 21.9%

984 FY21 984 333 FY21 333 27.6% FY21 27.6%
1,224 FY20 1,224 390 FY20 390 27.9% FY20 27.9%
1,654 FY19 1,654 414 FY19 414 22.7% FY19 22.7%

Metrics June 2022 June 2021 June 2019

QFF members M 14.1 13.6 12.9
Points earned B 118 94 156
Points burned B 121 82 135
Qantas Loyalty has continued to provide an important source of earnings and cash flow diversification for the Group. Underlying EBITDA for
the year was $351 million, with Underlying EBIT of $292 million and a return to double digit growth in the second half of the year. Despite
negative impacts from COVID-19 lockdowns, it was a strong result given limited flying from the airline segments to drive member activity.
Cash billings remained strong, with external sales greater than $1 billion for the third year in a row.
Earnings momentum improved through the year as restrictions eased and travel demand resumed. Activity peaked in the fourth quarter, with
airline redemptions returning to pre-COVID levels and points earned on financial services products exceeding pre-COVID levels. During the
lockdowns periods retail businesses such as Qantas Wine and Qantas Rewards Store performed well and saw redemptions rise above pre-
COVID levels. The strength of the program was also reflected in membership growth, with 0.5 million new members by the end of the year.
Qantas Loyalty maintained its strong presence in the Australian credit card market, with approximately 35 per cent of consumer credit spend
occurring on credit cards earning Qantas Points. The spend on such cards returned to pre-COVID levels, with 50 per cent growth in new credit
cards acquired during the year.
Agreements were renewed with key coalition partners including Woolworths and all five major financial services providers and new strategic
partnerships announced with Accor, Optus and Zip. Qantas Loyalty also launched Qantas Business Money, a global payments platform for
members to make international business payments in a cost-effective and rewarding way.
Despite reduced flying opportunities, the program maintained strong member engagement through initiatives to improve generosity. These
included the largest ever release of Classic Reward seats (resulting in a record day for flight redemptions), increased member value in Hotels
and Holidays redemptions as well as the launch of Green Tier, a new tier for members who make sustainable choices.
In May 2022, Qantas Loyalty secured a 51 per cent stake in TripADeal, an online travel business, continuing its investment in adjacent
businesses and complementing its own Hotels and Holidays brands to capture anticipated strong growth as travel recovers.
With a strong future pipeline of new initiatives, Qantas Loyalty remains focused on growing program value, providing confidence in achieving
its $500-600 million Underlying EBIT target by financial year 2023/24.

22
 QANTAS ANNUAL REPORT 2022

Review of Operations continued

For the year ended 30 June 2022

UNDERLYING PROFIT BEFORE TAX (UNDERLYING PBT) AND RECONCILIATION TO STATUTORY LOSS BEFORE
TAX
The Statutory Loss Before Tax of ($1,191) million for financial year 2021/22 compares to a Statutory Loss Before Tax of ($2,299) million for
financial year 2020/21 and a Statutory Profit Before Tax of $1,192 million for financial year 2018/19.

Underlying PBT
Underlying PBT is a non-statutory measure and is the primary reporting measure used by the CODM for the purpose of assessing the
performance of the Group. The objective of measuring and reporting Underlying PBT is to provide a meaningful and consistent representation
of the underlying performance of each operating segment and the Qantas Group.
Underlying PBT includes the impact of COVID-19 on the operating performance of the Group. Group revenue for the financial year 2021/22 as
recognised within Underlying PBT is down $8.9 billion compared to the financial year 2018/19 (pre-COVID), which is consistent with the
reduction of revenue within the Group’s Statutory Loss.
Likewise, the impact of the decisive actions taken by the Group to mitigate the impact of COVID-19, including reducing flight capacity
domestically and internationally (with associated reductions in fuel and other variable costs), workforce stand downs and operational cost
reduction measures, have also been recognised in Underlying PBT. Government support to mitigate the impact of COVID-19 from travel
restrictions and border closures, including the IAS, RDAC, RANS, DANS, TANS, government repatriation flights and IFAM payments, together
with costs to operate or payments to employees, is also recorded in Underlying PBT.
Items which are identified by Management and reported to the CODM bodies as not representing the underlying performance of the business
are not included in Underlying PBT. The determination of these items is made after consideration of their nature and materiality and is applied
consistently from period to period.
Items not included in Underlying PBT primarily result from revenues or expenses relating to business activities in other reporting periods,
restructuring/transformation initiatives, transactions involving investments, impairments of assets and other transactions outside the
ordinary course of business.
The impact of COVID-19 and the Group’s Recovery Plan resulted in items not included in Underlying PBT, including asset impairments, and
Recovery Plan restructuring costs, including redundancies and de-designated hedging due to a significant decrease in flying activity. De-
designations or ineffectiveness relating to hedging which were designated subsequent to the impact of COVID-19 is considered to have
occurred within the ordinary course of business and is recognised within Underlying PBT.
June June
June 2021 2019
2022 (restated) (pre-COVID)
RECONCILIATION OF UNDERLYING PBT TO STATUTORY LOSS BEFORE TAX $M $M $M
Underlying PBT (1,859) (1,774) 1,326
Items not included in Underlying PBT
– Transformation costs30 — — (260)
– Recovery Plan restructuring costs31 (21) (319) —
– Reversal of impairment/(Impairment) of assets and related costs 3 (257) 39
– De-designation of pre-COVID fuel and foreign exchange hedges — 33 —
– Net gain on Mascot land and buildings 686 — 192
– Net gain on disposal of assets — 18 —
– Unrealised foreign exchange movements from the adoption of AASB 16 and the IFRIC fair — — (105)
value hedging agenda decision
Total items not included in Underlying PBT 668 (525) (134)
Statutory Loss Before Income Tax Expense (1,191) (2,299) 1,192
In the 2021/22 financial year, the items outside of Underlying PBT included:
Item Outside of
Underlying PBT Description
Recovery Plan $21 million primarily relates to $14 million of restructuring costs resulting from fleet and people restructuring as a
restructuring costs result of the Recovery Plan and $7 million acquisition and launch costs for new businesses.
Reversal of impairment $3 million of reversal of impairment relates to $1 million net reversal of impairment relating to the Group’s
of assets and related investment in Helloworld and $2 million other impairment reversals.
costs
Net gain on disposal of The net gain on disposal of assets of $686 million arose from the sale of land in Mascot, Sydney that was not core
assets to the Group’s long-term strategy.
Refer to Note 2(B) of the Financial Report for details of items not included in Underlying PBT.

30
Costs incurred under the Transformation Program in previous years are reported under Transformation costs.
31
Costs incurred in relation to the Group’s Recovery Plan are reported under Recovery Plan restructuring costs.

23
QANTAS ANNUAL REPORT 2022

Review of Operations continued

For the year ended 30 June 2022

MATERIAL BUSINESS RISKS

The aviation industry is subject to numerous inherent risks that can impact operations if left untreated. In rare circumstances, ‘black swan’
risk events can materialise, resulting in unexpected consequences such as those that the aviation industry is experiencing due to COVID-19.
The COVID-19 pandemic has impacted Qantas’ operations significantly, including its strategic, operational and financial objectives.
Material business risks arising from the ongoing impact of COVID-19 are being critically managed to ensure a sustained recovery for the
Group. The Recovery Plan is on track to deliver the targeted $1 billion of ongoing structural cost benefits by financial year 2022/23. With the
prolonged impact of COVID-19, the Group continues to plan for a wide range of scenarios and risks to ensure the Group is well-positioned to
achieve the required level of transformation to support target outcomes and meet travel demand and customer expectations.
Other inherent risks that can impact the Group’s operations include exposure to economic uncertainty and geopolitical instability, changes in
government regulations, volatility in fuel prices and foreign exchange rates, and other exogenous events such as aviation incidents, natural
disasters or international conflicts.
COVID-19 outbreak management: Through its ‘Fly Well’ and ‘Work Well’ programs, Qantas has continued implementing initiatives aimed at
preventing the introduction and spread of COVID-19 in workplaces and aircraft for the protection of our people and our customers. These
controls not only seek to protect health but also support business continuity. The Qantas Group continues to adapt its risk mitigations to
changing circumstances and government regulations and restrictions and will adapt its policies, processes and practices as appropriate.
Given the Group’s geographic footprint, these changes are often jurisdiction-specific, requiring a multi-layered framework to ensure
compliance.
Operational Ramp-up: The Group has seen a faster than expected return of travel demand, for both domestic and international travel,
following the rapid easing of travel restrictions in the second half of financial year 2021/22. Supported by a successful vaccination program,
this includes signs of renewed customer confidence following the delay in travel recovery resulting from Delta and Omicron. Despite this, the
operational challenges presented in the second half of financial year 2021/22 demonstrate that whilst demand may be more resilient to
COVID-19, the operational disruptions created by COVID-19 sickness, tight labour market, and adverse weather and airport infrastructure
events, may continue and particularly if government mandated restrictions return. As such, the Group continues to retain flexibility in
planning its capacity settings, recruiting and training employees to support capacity growth and investing in operations to respond to sudden
changes in demand should further waves of the pandemic occur.
General economic conditions post-crisis: As air travel is closely linked with economic growth, the Qantas Group’s operating and financial
performance is influenced by a variety of general economic and business conditions in Australia and overseas. COVID-19 and the geopolitical
tensions, including the ongoing war in Ukraine and strained relations between China and Taiwan, have created considerable uncertainty and
volatility surrounding these macroeconomic factors, and any further deterioration may have a materially adverse impact on the business,
financial condition and prospects of the Qantas Group. In more recent times, some macroeconomic risks have emerged as central banks
normalise interest rates following an extensive period of accomodative monetary policy, which may impact future economic demand. To
address these risks, the Group retains flexibility to adjust capacity and has developed and identified responses to address a range of
scenarios, including multi-year high fuel prices, low exchange rate, high inflation rate, and weak Australian dollar, to protect the Group’s
financial position.
Fuel and foreign exchange volatility: The Qantas Group is subject to fuel price (including refining margin) and foreign exchange risks. These
risks are an inherent part of the operations of an airline and as such, are an industry-wide risk. For the Qantas Group, the size of the Group’s
fuel and foreign exchange risk will vary with operational capacity, size of fleet renewals and the routes the Group operates. The Qantas Group
manages its fuel and foreign exchange risks through a comprehensive hedging program which provides time for the business to ultimately
adjust its capacity to reflect the new operating environment. This was evident during the second half of financial year 2021/22, with hedging
placed during the COVID-19 period providing some protection against record high fuel prices resulting from the Ukraine war, before necessary
reductions in capacity to generate RASK increases occurred. Qantas will continue to hedge its fuel and foreign exchange risks in line with this
program. The Group normally uses a mix of fuel derivative collars and outright options to cover underlying fuel price risk and is actively
managed for changes in capacity.
Competitive intensity: Ordinarily, the international and domestic aviation markets in which the Qantas Group operates are highly competitive,
and growth in market capacity ahead of underlying demand can impact upon industry profitability. Competitors include many major foreign
airlines (including government-owned or controlled airlines), some with more financial resources or lower cost structures than Qantas. This
competition may increase with the expansion of existing airlines, the consolidation of existing airlines and/or the creation of alliances
between airlines, or new airlines entering the market.
Australia’s aviation policies favour a highly competitive environment, including more liberal rights of entry into Australian domestic and
international markets. These policies have historically attracted offshore competitors (predominantly state-sponsored airlines) to the
Australian international aviation market, which has further increased competition for passengers on international routes. Additionally, the
Qantas Group ordinarily faces high levels of price competition in the markets in which it operates and aggressive pricing by competitors
seeking to gain market share can adversely affect the Qantas Group’s revenues and yield performance. The financial impact of any
discounting of fares as a result of competitive pressures is exacerbated by the high fixed costs that characterise the aviation industry. The
combined effect of these factors may have a materially adverse effect on the revenue and financial condition of the Group.

24
QANTAS ANNUAL REPORT 2022

Review of Operations continued

For the year ended 30 June 2022

MATERIAL BUSINESS RISKS (CONTINUED)

Employee relations: The Qantas Group operates in a highly regulated employment market and a large portion of the Qantas Group’s
employees are represented by unions and are party to collective bargaining arrangements. Any significant enterprise bargaining dispute
between the Qantas Group and its employees, including in relation to the Recovery Plan, could lead employees to take industrial action,
including work stoppages. This could disrupt the Qantas Group’s day-to-day operations and adversely affect business performance,
potentially leading to reputational damage. The Group has developed business continuity planning arrangements, including testing and
rehearsal (to the extent possible), to provide continuity of operations in the event of an industrial action.
In the first half of financial year 2021/22, the Group focused on returning stood down employees to work in response to planned increases in
demand for air travel. These plans were impacted by significant COVID-19 outbreaks which led to widespread lockdowns in New South Wales
and Victoria. The Group recognises that future outbreaks of COVID-19 due to new variants may lead to employees having to further self-
isolate. These periods of self-isolation have also led to operational disruption as frontline staff are unable to attend their workplace resulting
in operational challenges and schedule disruption. This has been amplified as our suppliers and other parts of the aviation industry are
experiencing similar COVID-19-driven resource constraints. This situation requires increased efforts to ensure that our people remain
connected to the organisation, and their health and wellbeing are supported. Relevant information continues to be communicated to our
people through a series of channels, including regular Town Hall meetings hosted by the Group Executive Committee. Employee mental health
continues to be a key area of focus, with enhanced services provided through our Employee Assistance Program as well as manager toolkits
to assist with increasing awareness, identification, support and monitoring of employee mental health.
The prolonged impact of COVID-19 on the airline industry continues to negatively impact the ability to attract and retain appropriate talent and
technical/specialist resources. The labour market’s constrained environment will continue to put pressure on planned capacity given the need
to ramp-up the workforce to support operations over the next few months. Management continues to develop and implement contingency/
action plans to manage the impact of the ongoing labour shortage on the Group.
Customer risk: The ongoing success of the Qantas Group depends to a large degree on customer satisfaction and loyalty, particularly in light
of the significant competition for passengers that characterises the aviation industry. The significant financial and operational challenges
posed by COVID-19, the impact of the pandemic on the travel industry, the opening and closing of domestic and international borders and the
response of the Qantas Group to these challenges could also impact customer satisfaction and loyalty. In particular, a diminution of customer
satisfaction due to the cancellation, credit and refund policies of the Qantas Group in the context of COVID-19 may impact the Qantas Group’s
reputation and its ability to attract customers in the future. The Group continues to provide customers with flexibility and options to utilise
their flight credits, vouchers, and TravelPass and is actively encouraging customer usage. Loss of brand preference due to prolonged
operational issues is also a key customer risk and ensuring on time performance and reliability remains a key priority for the Group.
In addition, the Qantas Group is vulnerable to long-term changes in consumer preferences in relation to its service offerings, the markets in
which it operates, and consumer and business sentiment towards travel, including environmental considerations. Any failure by the Qantas
Group to predict or respond to such changes in a timely and cost-effective manner may adversely impact the Qantas Group’s future operating
and financial performance. As customer preferences shifted significantly due to COVID-19, as well as ensuring operational resilience, the
Group is looking to transform the customer experience through a multi-year program of work aimed at adapting to new customer journey
requirements, market learnings and business need, to ensure the Group’s strong market position is maintained.
Climate change: The Group recognises that human-induced climate change is a significant issue for the aviation industry and is committed to
reducing its greenhouse gas (GHG) emissions in line with the Paris Climate Agreement to limit warming to well below 2 degrees Celsius above
pre-industrial levels, and pursuing efforts to limit the temperature increase to 1.5 degrees Celsius above pre-industrial levels. Climate-related
risks include both physical risks (such as increased extreme weather events) and transition risks (including development of alternative fuel
and changes to government policy, law and regulation). The Group will manage these risks through mechanisms including, but not limited to,
scenario analysis to inform the Group’s strategy; robust governance; adopting lower-GHG emissions technology; operational and market-
based controls; and monitoring government policy. More detail will be provided in the 2022 Sustainability Report. In 2019, the Group
announced its ambition to achieve net zero GHG emissions by 2050 and to cap net GHG emissions at 2019 levels. In March 2022, the Qantas
Group’s Climate Action Plan was released with targets for: a 25 per cent reduction in net emissions from 2019 levels by 2030; 10 per cent
sustainable aviation fuel in fuel mix by 2030; and an average of 1.5 per cent fuel efficiency improvements to 2030.32 The Qantas Group is
responding to increased demand for transparency on identification and management of climate-related risks by aligning its corporate
disclosures with the Taskforce on Climate-related Financial Disclosures (TCFD). These disclosures will be available in the 2022 Sustainability
Report.
Brand reputation: The Qantas brand carries significant commercial value, and the continued success of the Qantas Group relies on the
maintenance of a positive reputation and brand recognition among customers, suppliers, strategic partners and governments. Any negative
publicity (for example, due to a safety incident, labour dispute, regulatory investigation, public customer complaints or operational
performance) may damage Qantas’ reputation and have a negative impact on its business operations and financial performance. The
Customer Insights team constantly monitors customer satisfaction through post-flight surveys and regularly monitors trust in the Qantas
Group brands alongside ongoing research and development of Qantas Group products to mitigate this risk.

32
An average 1.5 per cent per annum fuel efficiency improvement starting from 2023, baselined to 2019.

25
QANTAS ANNUAL REPORT 2022

Review of Operations continued

For the year ended 30 June 2022

MATERIAL BUSINESS RISKS (CONTINUED)

Cyber security and data governance: As cyber breaches and attacks surge globally and remote ways of working continue, the Qantas Group
remains focused on embedding cyber security, privacy and data governance into business processes, taking a security and privacy by design
approach and creating a cybersafe and privacy orientated culture that builds on an established safety culture. The Group’s Data Governance
Framework has been enhanced to ensure ethical and commercial data risks are managed in addition to data protection and privacy. Qantas
has a defined Risk and Control Framework, aligned with industry standards, which is designed to protect the confidentiality, integrity,
availability and privacy of data and to maintain compliance with regulatory requirements. The Qantas Group's cyber security and data
privacy-related controls operate to reduce the likelihood and severity of cyber security and data privacy-related incidents and related
impacts. The Group’s cyber and data privacy risks are continuously monitored by the Group Cyber and Privacy Committee and are subject to
independent assurance, including for material third-party suppliers.
Key business partners and alliances: The Qantas Group has relationships with a number of key business partners. In order to continue to
maximise mutual benefit from both a financial and customer proposition perspective, governance structures are in place to track and report
performance against common strategic objectives. The Qantas Group continues to proactively build relationships with existing and new
industry partners through ongoing dialogue with relevant authorities and stakeholder groups.
Key supplier risk: The Qantas Group is dependent on third-party providers for some principal business processes that are integral to its
business. The failure of these providers to adequately perform their service obligations, or other unexpected interruptions of services, may
cause significant disruption to the Group’s operations and have an adverse impact on financial performance. Qantas uses its Business
Continuity Plans to cover the risk of supply failures and has contingency plans in place to respond to key supplier interruption.
The Group continues to work with its key suppliers to improve resource capacity and implement contingency plans to address the labour
shortage challenges driven by the influenza season and recent spike in COVID-19 cases and the corresponding isolation requirements,
coupled with the ongoing tight labour market. The Group has implemented dedicated account management protocols with structured
engagement and Group governance to provide oversight of third-party service providers’ performance to enable the uplift of the Group’s
performance and meet customers’ expectations.
Risk of increase in airport services-related costs or change in availability of airport facilities: The Qantas Group is exposed to the risk of
increases in airport services-related costs (including air traffic control, airport, transit, take-off and landing fees and security charges). The
availability and cost of airport facilities are fundamental to the ability of the Qantas Group to operate.
These costs represent a significant portion of the Qantas Group’s operating costs. The majority of Australian airports are privately owned, and
owners have flexibility to increase charges to airlines. There can be no assurance that major airport operators will not continue to increase
their fees or that the Qantas Group will not incur new costs in Australia or elsewhere (for example, additional fees assessed against
environmental criteria such as emissions levels or noise pollution). Furthermore, it is likely that security and health measures around the
world will continue to be increased in response to the COVID-19 experience and the perceived threat of terrorism, which may lead to increases
in airport clearance and security charges. To the extent that the Qantas Group is unable to pass on any fee increases to its customers, these
developments could have a material adverse effect on the Qantas Group’s operational results and financial position.
In addition, health concerns during the COVID-19 crisis and in the period following it are likely to impact the availability of airport slots and
facilities in ways that are difficult to predict. This could have a materially adverse effect on the Qantas Group’s operations and Recovery Plan.
An overview of the Group Risk Management Framework is contained in the Qantas Group Business Practices Document available at
www.qantas.com.au.

26
QANTAS ANNUAL REPORT 2022

Condensed Corporate Governance Statement

For the year ended 30 June 2022

OVERVIEW THE BOARD INSTILS A CULTURE OF ACTING LAWFULLY,

Corporate governance is core to ensuring the creation, protection ETHICALLY AND RESPONSIBLY
and enhancement of shareholder value. The Board maintains, The Board has established a Corporate Governance Framework,
and requires that Qantas Management (Management) maintains, comprising Non-Negotiable Business Principles (Principles) and
the highest level of ethics at all times. Group Policies, which forms the foundation for the way in which
The Board comprises a majority of Independent Non-Executive Qantas and its controlled entities (Qantas Group or Group)
Directors who, together with the Executive Director, have an undertake business. The Principles and Group Policies, including
appropriate balance of skills, knowledge, experience, the Qantas Group Code of Conduct and Ethics, are detailed in
independence and diversity to enable the Board as a collective to the Qantas Group Business Practices document. This Framework
effectively discharge its responsibilities. is supported by a rigorous Whistleblower Program, which provides
a protected disclosure process for all disclosing persons, and an
The Board has endorsed and adopted the ASX Corporate Anti-Bribery and Corruption Policy, which outlines appropriate
Governance Principles and Recommendations (ASX Principles) behaviour for all employees of the Qantas Group.
4th Edition throughout 2021/22.
The Qantas Group Employee Share Trading Policy sets out
Accordingly, Qantas Airways Limited (Qantas) has disclosed guidelines designed to protect the Qantas Group, its Directors and
its 2022 Corporate Governance Statement in the Corporate its employees from intentionally or unintentionally breaching
Governance section on the Qantas website. As required, the law. The Qantas Group Employee Share Trading Policy
Qantas has also lodged its Corporate Governance Statement prohibits employees from dealing in the securities of any Qantas
with the ASX. Group listed or unlisted entity while in possession of material non-
Following is a summary of the key aspects of the Corporate public information.
Governance Statement. In addition, certain nominated Qantas Group employees are
THE BOARD LAYS SOLID FOUNDATIONS FOR MANAGEMENT also prohibited from entering into any hedging or margin lending
AND OVERSIGHT arrangement or otherwise granting a charge over the securities
of any Qantas Group listed or unlisted entity, where control of
The Board has adopted a formal Charter, which is available any sale process relating to those securities may be lost.
in the Corporate Governance section on the Qantas website.
THE BOARD SAFEGUARDS THE INTEGRITY OF CORPORATE
The Board is responsible for agreeing and reviewing the strategic FINANCIAL REPORTING
direction of Qantas and monitoring the implementation of that
strategy by Management. The Board and the Audit Committee closely monitor the
integrity of all corporate reports. Qantas has a sound system
The CEO is responsible for the day-to-day management of of risk management and internal controls in place to verify
the Qantas Group with all powers, discretions and delegations the half-year and annual financial reports and confirm the
authorised, from time to time, by the Board. declarations provided by the CEO and CFO to the Board.
The Company Secretary is accountable directly to the Board, The Board and the Audit Committee also monitor the
through the Chairman, on all matters to do with the proper independence of the external auditor. Qantas rotates the lead
functioning of the Board. external audit partner every five years and imposes restrictions on
THE BOARD IS STRUCTURED TO BE EFFECTIVE AND the employment of personnel previously employed by the external
TO ADD VALUE auditor. Qantas rotated its lead external audit partner during the
2021/22 financial year. The next rotation of audit signing partner
The Qantas Board currently has eight Directors. Seven Directors for KPMG will take place following the finalisation of the audit for
are Independent Non-Executive Directors elected by shareholders. the 2025/26 financial year. Notwithstanding there are no service,
The Qantas CEO, who is an Executive Director, is not regarded quality or independence issues with the current auditor, in
as independent. consideration of best practice, the Qantas Group has decided to
Details of the current Directors, their qualifications, skills, undertake a competitive external audit tender process during the
experience and tenure are set out on pages 9 to 11 of the Qantas 2024/25 financial year for appointment in relation to the 2026/27
Annual Report 2022. financial year.

The Board has four committees: The Qantas Group is committed to verifying the integrity of all
other periodic corporate reports it releases to the market that are
– Audit Committee not audited or reviewed by the external auditor. Information
– Nominations Committee regarding the verification process is disclosed in our 2022
Corporate Governance Statement.
– Remuneration Committee
– Safety, Health, Environment and Security Committee.
Each of these committees assists the Board with specified
responsibilities that are set out in the Committee Charters,
as delegated and approved by the Board.
Membership of and attendance at 2021/22 Board and Committee
meetings are detailed on page 30 of the Qantas Annual Report
2022.

27
QANTAS ANNUAL REPORT 2022

Condensed Corporate Governance Statement continued

For the year ended 30 June 2022

THE BOARD MAKES TIMELY AND BALANCED DISCLOSURE THE BOARD RECOGNISES AND MANAGES RISK
Qantas is committed to ensuring that trading in its shares takes Qantas is committed to embedding risk management practices
place in an orderly and informed market, by having transparent to support the achievement of business objectives and fulfil
and consistent communication with all shareholders. Qantas corporate governance obligations. The Board is responsible
has an established process to ensure that it complies with for reviewing and overseeing the risk management strategy
its continuous disclosure obligations at all times, including a bi- for the Qantas Group, including that the Group is operating
annual confirmation by all Executive Management that with due regard to the risk appetite set by the Board, and
the areas for which they are responsible have complied for ensuring the Qantas Group has an appropriate corporate
with the Group’s Continuous Disclosure Policy. governance structure. Within that overall strategy, Management
has designed and implemented a risk management and internal
Qantas proactively communicates with its shareholders via the
control system to manage Qantas’ material business risks.
ASX and its web-based Newsroom, with all materials released
by the Group made available to all shareholders at the same time. During 2021/22, the Audit Committee undertook its annual review
Additionally, the Qantas Board receives copies of all material of the effectiveness of Qantas’ implementation of its risk
market announcements for review and approval of release to the management system and internal control framework.
market, as well as a final copy promptly after they have been
The internal audit function is carried out by Group Audit and
made.
Risk and is independent of the external auditor. Group Audit
THE BOARD RESPECTS THE RIGHTS OF SHAREHOLDERS and Risk provides independent, objective assurance and
consulting services on Qantas’ system of risk management,
Qantas has a Shareholder Communications Policy which promotes
internal control and governance.
effective two-way communication with shareholders and the
wider investment community and encourages participation at The Audit Committee approves the Group Audit and Risk Internal
general meetings. Qantas actively maintains a corporate site and Audit Charter, which provides Group Audit and Risk with full
investor portal which outlines the company’s corporate access to Qantas Group functions, records, property
governance policies and procedures and includes an array of and personnel, and establishes independence requirements.
information to help assist investors to make informed decisions. The Audit Committee also approves the appointment, replacement
and remuneration of the internal auditor. The internal auditor has
Additionally, Qantas actively conveys its publicly-disclosed
a direct reporting line to the Audit Committee and also provides
information and seeks the views of its shareholders, large and
reporting to the Safety, Health, Environment and Security
small, in a number of forums, including at the Annual General
Committee.
Meeting (AGM), Qantas Investor Days and, as is common practice
among its major listed peers, through periodic meetings with THE BOARD REMUNERATES FAIRLY AND RESPONSIBLY
current and potential institutional shareholders.
The Qantas Executive remuneration objectives and approach
Shareholders also have the option to receive communications are set out below.
from, and send communications to, Qantas and its share registry
Information about the remuneration of Executive Management is
electronically, including email notifications of significant market
disclosed to the extent required, together with the process
announcements. Qantas is focused on reducing our carbon
for evaluating performance, in the Remuneration Report from
footprint whilst providing timely corporate updates and
page 34 to 62 of the Qantas Annual Report 2022.
disclosures, as such Qantas will no longer send physical meeting
documents unless a shareholder requests a copy to be mailed. Qantas Non-Executive Directors are entitled to statutory
superannuation and certain travel entitlements (accrued
The external auditor attends the AGM and is available to
during service) that are reasonable and standard practice
answer shareholder questions that are relevant to the audit.
in the aviation industry. Non-Executive Directors do not
receive any performance-based remuneration (see pages 60 to 62
of the Qantas Annual Report 2022).

28
QANTAS ANNUAL REPORT 2022

Directors’ Report
For the year ended 30 June 2022

The Directors of Qantas Airways Limited (Qantas) present SIGNIFICANT CHANGES IN STATE OF AFFAIRS
their Report, together with the Financial Statements of the
In the opinion of the Directors, there were no other significant
consolidated entity comprising Qantas and its controlled entities
changes in the state of affairs of the Qantas Group that occurred
(Qantas Group) and the Independent Audit Report, for the year
during the financial year under review that are not otherwise
ended 30 June 2022. In compliance with the provisions of the
disclosed in this Report.
Corporations Act 2001 (Cth), the Directors’ Report is set out below.
REVIEW OF OPERATIONS
DIRECTORS
A review of, and information about, the Qantas Group’s operations,
The Directors of Qantas during the year were:
including the results of those operations during the year, together
Richard Goyder AO with information about the Qantas Group’s financial position,
appear on pages 12 to 26.
Alan Joyce AC
Details of the Qantas Group’s strategies, prospects for future
Maxine Brenner
financial years and material business risks have been included
Jacqueline Hey in the Review of Operations to the extent that their inclusion
is not likely to result in unreasonable prejudice to the Qantas
Belinda Hutchinson AC
Group. In the opinion of the Directors, detail that could be
Michael L’Estrange AO unreasonably prejudicial to the interests of the Qantas Group, for
Paul Rayner (retired 5 November 2021) example, information that is commercially sensitive, confidential
or could give a third party a commercial advantage, has not been
Todd Sampson included.
Antony Tyler EVENTS SUBSEQUENT TO BALANCE DATE
Barbara Ward AM (retired 5 November 2021) Refer to page 116 for events which occurred subsequent to
Details of the Directors’ qualifications, experience and any special balance date. Other than the matters disclosed on page 116,
responsibilities, including Qantas committee memberships, are since the end of the year and to the date of this Report no other
set out on pages 9 to 11. matter or circumstance has arisen that has significantly affected
or may significantly affect the Qantas Group’s operations,
PRINCIPAL ACTIVITIES results of those operations or state of affairs in future years.
The principal activities of the Qantas Group during the
year were the operation of international and domestic
air transportation services, the provision of freight services
and the operation of a frequent flyer loyalty program.
DIVIDENDS AND OTHER SHAREHOLDER DISTRIBUTIONS
No final dividend will be paid in relation to the year ended
30 June 2022 (2021: nil final dividend). No interim dividend
or other shareholder distributions were paid during the year. In
August 2022, the Directors announced an on-market share buy-
back of up to $400 million.

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Directors’ Report continued

For the year ended 30 June 2022

DIRECTORS’ MEETINGS
The number of Directors’ meetings held (including meetings of Committees of Directors) and attendance of Directors during 2021/22
is as follows:
Qantas Board Remuneration Committee1

Safety, Health,
Environment
Unscheduled
Scheduled Unscheduled Sub-Committee Audit and Security Scheduled Nominations
2 1 1 1
Meetings Meetings Meetings Committee Committee Meetings Meetings Committee
Directors Attended Held3 Attended Held3 Attended Held3 Attended Held3 Attended Held3 Attended Held3 Attended Held3 Attended Held3
4
Richard Goyder 10 10 2 2 3 35 - - - - - - - - 2 2
5
Alan Joyce 10 10 2 2 3 3 - - 5 5 - - - - - -
Maxine Brenner 10 10 2 2 - - 5 5 - - 3 3 1 1 - -
Jacqueline Hey6 10 10 2 2 - - 5 5 - - 2 2 1 1 1 1
Belinda Hutchinson7 10 10 2 2 2 24 5 5 5 5 - - - - 1 1
Michael L’Estrange 10 10 2 2 - - - - 5 5 3 3 1 1 - -
8
Paul Rayner 4 5 1 1 - - - - - - 1 1 0 1 1 1
Todd Sampson9 10 10 1 2 - - 4 4 - - 3 3 1 1 - -
Antony Tyler 10 10 2 2 - - - - 5 5 - - - - 2 2
10 4
Barbara Ward 5 5 1 1 1 1 1 1 1 1 - - - - 1 1
1 All Directors are invited to, and regularly attend, Committee meetings in an ex officio capacity. The above table reflects the attendance of a Director only where he or she is a member
of the relevant Committee.
2 Sub-Committee meetings convened for specific Board-related business.
3 Number of meetings held during the period that the Director held office.
4 The Chairman attends all Committee meetings.
5 Number of meetings held and requiring attendance.
6 Jacqueline Hey was appointed Chair of the Remuneration Committee and Member of the Nominations Committee on 5 November 2021.
7 Belinda Hutchinson was appointed Chair of the Audit Committee on 5 November 2021.
8 Paul Rayner retired as Non-Executive Director on 5 November 2021.
9 Todd Sampson was appointed a Member of the Audit Committee on 5 November 2021.
10 Barbara Ward retired as Non-Executive Director on 5 November 2021.

DIRECTORSHIPS OF LISTED COMPANIES HELD BY MEMBERS OF THE BOARD AS AT 30 JUNE 2022

– FOR THE PERIOD 1 JULY 2019 TO 30 JUNE 2022
Richard Goyder Qantas Airways Limited Current, appointed 17 November 2017
Woodside Energy Group Ltd Current, appointed 1 August 2017

Alan Joyce Qantas Airways Limited Current, appointed 28 July 2008

Maxine Brenner Qantas Airways Limited Current, appointed 29 August 2013

Origin Energy Limited Current, appointed 15 November 2013
Orica Limited Current, appointed 8 April 2013
Woolworths Group Limited Current, appointed 1 December 2020
Growthpoint Properties Australia Limited Ceased, appointed 19 March 2012 and ceased 30 November 2020

Jacqueline Hey Qantas Airways Limited Current, appointed 29 August 2013

Bendigo and Adelaide Bank Limited Current, appointed 5 July 2011
AGL Energy Limited Ceased, appointed 21 March 2016 and ceased 30 May 2022
Belinda Hutchinson Qantas Airways Limited Current, appointed 12 April 2018
Future Generation Global Investment Ceased, appointed 28 May 2015 and ceased 17 June 2021
Company Limited

Michael L’Estrange Qantas Airways Limited Current, appointed 7 April 2016

Rio Tinto Limited Ceased, appointed 1 September 2014 and ceased 6 May 2021
Rio Tinto plc Ceased, appointed 1 September 2014 and ceased 6 May 2021
Todd Sampson Qantas Airways Limited Current, appointed 25 February 2015

Antony Tyler Qantas Airways Limited Current, appointed 26 October 2018

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Directors’ Report continued

For the year ended 30 June 2022

QUALIFICATIONS AND EXPERIENCE OF EACH PERSON WHO HELD OFFICE AS A COMPANY SECRETARY OF QANTAS BETWEEN
1 JULY 2021 UNTIL THE DATE OF THIS REPORT
Andrew Finch – – BCom, LLB (UNSW), LLM (Hons I) (Usyd), MBA (Exec) (AGSM)
Company Secretary – Appointed as Company Secretary on 31 March 2014
– Joined Qantas on 1 November 2012
– 2002 to 2012 – Mergers and Acquisitions Partner at Allens, Sydney (previously Allens Arthur Robinson
and Allen & Hemsley)
– 1999 to 2001 – Managing Associate at Linklaters, London
– 1993 to 1999 – Various roles at Allens, Sydney including Senior Associate (1997 to 1999) and Solicitor (1993
to 1997)
– Admitted as a solicitor of the Supreme Court of NSW in 1993
Benjamin Jones – – LLM (Usyd), LLB, BsocSci (Policy) (UNSW)
Company Secretary – Appointed as Company Secretary on 20 July 2021
– Joined Qantas on 9 September 2013
– Admitted as a solicitor of the High Court of Australia and the NSW Supreme Court in 2008
– 2008 to 2013 – Solicitor at Herbert Smith Freehills
– 2013 to present – Football Australia, Disciplinary and Ethics Committee Member
– 2013 to present – Football NSW, General Purposes Tribunal (Deputy Chair 2018 to present)
Benjamin Elliott – – BBC, GIA (Affiliated)
Company Secretary – Appointed as Company Secretary on 18 February 2020
– Joined Qantas on 14 August 2013
– 2021 to present – Head of Secretariat and Corporate Governance
– 2018 to 2021 – Manager, Group Secretariat
– 2014 to 2018 – Manager, Corporate Governance
– 2013 to 2014 – Manager, Public Company

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Directors’ Report continued

For the year ended 30 June 2022

DIRECTORS’ INTERESTS AND BENEFITS

Particulars of Directors’ interests in the issued capital of Qantas at the date of this Report are as follows:

Number of Shares
Directors 2022 20211
2
Richard Goyder 193,537 157,7802
Alan Joyce 2,990,243 2,990,243
Maxine Brenner 39,498 39,498
Jacqueline Hey 64,8272 57,1152
Belinda Hutchinson 55,5782 40,7272
Michael L’Estrange 33,945 29,445
2
Todd Sampson 36,879 30,7062
Antony Tyler 52,000 52,000

1 Shares held as at date of 2021 Annual Report (17 September 2021).

2 Includes restricted Ordinary Shares held by the Employee Share Plan Trust.

Rights held in trust under the Non-Executive Director Fee Sacrifice Share Acquisition Plan1:

Number of Rights
Directors 20222 20213
Richard Goyder 17,525 17,823
Jacqueline Hey - 4,616
Belinda Hutchinson 7,879 6,472
Todd Sampson 3,208 3,077
1 Refer to page 62 for information regarding the operation of the Non-Executive Director Fee Sacrifice Share Acquisition Plan.
2 Rights held as at date of 2022 Annual Report (9 September 2022).
3 Rights held as at date of 2021 Annual Report (17 September 2021).

In addition to the direct interests shown, indirect interests in Qantas shares held in trust on behalf of Mr Joyce are as follows:

Number of Rights
Rights granted under: 2022 2021
2018-2020 Long Term Incentive Plan 687,0001 687,0001
2019-2021 Long Term Incentive Plan 651,0001 651,0001
2020-2022 Long Term Incentive Plan 743,0001 743,0001
2021-2023 Long Term Incentive Plan 1,349,0002 1,349,0002
2022-2024 Long Term Incentive Plan 861,0003 -
Total Rights 4,291,000 3,430,000
1 Mr Joyce offered, and the Board agreed, to defer the decision of whether his Rights will be forfeited or allowed to convert to shares until at least August 2023.
2 Shareholders approved the award of these Rights on 23 October 2020. Performance hurdles will be tested as at 30 June 2023 to determine whether any Rights vest to Mr Joyce.
3 Shareholders approved the award of these Rights on 5 November 2021. Performance hurdles will be tested as at 30 June 2024 to determine whether any Rights vest to Mr Joyce.

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Directors’ Report continued

For the year ended 30 June 2022

PERFORMANCE RIGHTS
Performance Rights are awarded to select Qantas Group Executives under the Qantas Long Term Incentive Plan (LTIP). Additionally, the
Recovery Retention Plan (RRP) was announced in the second half of the 2021/22 financial year and includes the issue of Performance Rights
to eligible employees (both non-executive and executive). Refer to pages 50 to 52 for further details.
The following table outlines the movements in Rights during the year:

Number of Rights
Performance Rights Reconciliation 2022 2021
Rights outstanding as at 1 July 16,568,569 9,607,136
Rights granted 47,181,572 12,123,500
Rights forfeited (871,097) (2,879,567)
Rights exercised (827,568) (1,134,203)
Rights lapsed (857,432) (1,148,297)
Rights outstanding as at 30 June 61,194,0441 16,568,5691
1 The movement of Rights outstanding as at 30 June 2022 to the date of this Report is explained in the footnotes below.

Rights will be converted to Qantas shares to the extent performance hurdles have been achieved. The Rights do not allow the holder
to participate in any share issue of Qantas. No dividends are payable on Rights. The fair value of Rights granted is calculated at the date
of grant using a Monte Carlo model and/or Black-Scholes model.
The following Rights were outstanding at 30 June 2022:

Number of Rights
Value at 2022 2022 2022 2021 2021 2021
Name Testing Period Grant Date Grant Date Net Vested Unvested Total Net Vested Unvested Total
2018–2020 30 Jun 201 27 Oct 17 $3.30 - 687,000 687,000 - 687,000 687,000
Long Term
Incentive Plan
2019–2021 30 Jun 212 5 Sept 18 $3.35 - - - - 1,694,000 1,694,000
Long Term
Incentive Plan
2019–2021 30 Jun 212 26 Oct 18 $2.33 - 651,000 651,000 - 693,000 693,000
Long Term
Incentive Plan
2020–2022 30 Jun 223 4 Oct 19 $4.06 - 2,292,834 2,292,834 - 2,401,892 2,401,892
Long Term
Incentive Plan
2020–2022 30 Jun 223 26 Oct 19 $3.59 - 743,000 743,000 - 743,000 743,000
Long Term
Incentive Plan
2021–2023 30 Jun 23 11 Sep 20 $2.24 - 8,408,138 8,408,138 - 9,000,677 9,000,677
Long Term
Incentive Plan
2021–2023 30 Jun 23 23 Oct 20 $3.07 - 1,349,000 1,349,000 - 1,349,000 1,349,000
Long Term
Incentive Plan
2022–2024 30 Jun 24 17 Sep 21 $3.90 - 3,271,000 3,271,000 - - -
Long Term
Incentive Plan
2022–2024 30 Jun 24 5 Nov 21 $3.85 - 861,000 861,000 - - -
Long Term
Incentive Plan
2022–2023 30 Jun 23 28 Feb 224 $4.98 - 42,931,072 42,931,072 - - -
Recovery
Retention Plan
Total - 61,194,044 61,194,044 - 16,568,569 16,568,569
1 For the CEO, the CEO offered, and the Board agreed, to further defer the decision until at least August 2023 as to whether his Rights will be forfeited or allowed to convert to shares.
2 Following the testing of performance hurdles as at 30 June 2021 and the Board’s approval of the 2019-2021 vesting outcome on 25 August 2021, 50 per cent of Rights vested and
converted to shares after the release of the 2020/21 full-year financial results for Executives other than the CEO. For the CEO, the CEO offered, and the Board agreed, to defer the
decision as to whether his Rights will be forfeited or allowed to convert to shares. The decision has been deferred until at least August 2023.
3 Following the testing of performance hurdles as at 30 June 2022 and the Board’s approval of the 2020-2022 vesting outcome on 24 August 2022, 50 per cent of Rights vested and
converted to shares on the day of the release of the 2022 Annual Report for Executives other than the CEO. For the CEO, the CEO offered, and the Board agreed, to defer the decision
until at least August 2023 as to whether his Rights will be forfeited or allowed to convert to shares.
4 Eligible employees were advised of their participation in the RRP on 28 February 2022. Performance Rights were issued on 9 June 2022.

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED)

REMUNERATION REPORT
Cover Letter to the Remuneration Report 35
1 Remuneration Report Summary 37
2 Remuneration Governance 42
3 Remuneration Outcomes for 2021/22 44
4 Statutory Remuneration Disclosures for 2021/22 45
5 Executive Remuneration Structure 48
6 Annual Incentive Scorecard Outcome 2021/22 54
7 Long Term Incentive Outcome 2020-2022 56
8 Summary of Key Contract Terms as at 30 June 2022 56
9 Qantas Financial Performance History 57
10 Equity Instruments 58
11 Non-Executive Director Fees 60

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

COVER LETTER TO THE REMUNERATION REPORT

Dear Shareholder
This Remuneration Report sets out remuneration information for the Chief Executive Officer (CEO), direct reports to the CEO (Executive
Management) and Non-Executive Directors who are Key Management Personnel (KMP). It describes the Qantas Executive Remuneration
Framework (Remuneration Framework) and pay outcomes for 2021/22, and the intended Remuneration Framework for 2022/23, in a
way that I believe is simple and transparent.
Qantas is committed to operating efficiently and flexibly in responding to the challenges that COVID-19 presents, to position the Group for
future profitability and success as Australia and the rest of the world recovers from the pandemic. In 2021/22, the Group’s
flying operations were severely impacted by widespread domestic lockdowns and continued international restrictions, particularly during
the first half of the year. Despite ongoing and unpredictable border restrictions, the Group has remained agile in our response as we move
into the next phase of our Three-Year Recovery Plan (Recovery Plan). Forward demand for both domestic and international services
improved from February, helped by Australia’s reopening to all visa holders and the opening of all domestic borders.
The skill, experience, resourcefulness and dedication of our people are extraordinary and have enabled the Group to navigate the most
testing period in its 100-year history. However, the entire global aviation sector has been challenged by the continuation of COVID-19, the
prevalence of flu-related sickness and an extremely tight labour market. As a result, the Group did not deliver the service our customers
expect, and in acknowledgement of this, the Board exercised discretion to record no achievement against Customer in the Short Term
Incentive Plan (STIP) Scorecard. Management has apologised for this outcome and is undertaking a number of steps to proactively
address the situation and restore operational performance to our expected standards.

Recovery Retention Plan (RRP)

COVID-19 is the biggest challenge ever faced by global aviation. We understood this early and took drastic measures to enable the
business to survive. We then focused on our Recovery Plan. With the prolonged impact of COVID-19 on the aviation industry, the Group had
to plan for an extremely wide range of scenarios and risks to ensure it was well-positioned to achieve the required level of transformation
to support target outcomes.
Aligned with shareholder and customer expectations, our people have shared the burden of the financial performance of the business over
the period of COVID-19. However, as the Group moved into the second year of the pandemic, the Board became particularly concerned as
attrition reached three times pre-pandemic levels that further loss of capability and experience would materially inhibit the Group’s ability
to deliver the Recovery Plan and position the Group for success beyond the pandemic.
All of our people have encountered unprecedented challenges and uncertainty over the past two years. They have undertaken, and
continue to undertake, elevated workloads and demands while experiencing significant restraint on remuneration, including a general
wage freeze for two years, long periods of stand downs, and the exercise of Board discretion to forfeit incentives for 2019/20 and 2020/21
as the Group battled to remain viable and moved to repair the damage done by COVID-19.
It was in this highly uncertain environment that the Board sought to structure the Qantas Remuneration Framework for 2021/22 to
successfully deliver the Group’s Three-Year Recovery Plan.
Accordingly, the Board elected not to offer Executives an annual incentive opportunity for 2021/22 and instead approved the RRP which
was first flagged in September 2021. Executive Management and the broader Executive cohort received a grant of Rights in the RRP
subject to stretching performance conditions aligned to deliver a sustained recovery and support positive outcomes for shareholders.
Vesting will occur in August 2023 provided all our Recovery Plan performance conditions are achieved and participants remain employed
with the Qantas Group at that time. Otherwise, Rights will lapse. The performance conditions are:
– The Qantas Group meets its $1 billion recovery program target by 30 June 2023.
– As at 30 June 2023, Qantas Group’s Net Debt range is below the top end of the Net Debt range as approved by the Board in accordance
with the Group’s Financial Framework
– The Qantas Group is profitable on an Underlying Profit Before Tax (UPBT) basis for 2022/23.
Shareholder approval will be sought at the 2022 Annual General Meeting (AGM) for the CEO’s participation in the RRP and for the CEO’s
grant of Rights under the plan. In the case of the CEO, it should be noted that he took no Base Pay from 1 April 2020 to 31 July 2020 and a
35 per cent reduction in Base Pay from 1 August 2020 through to 31 October 2020. In addition, the CEO is one of the few in the ASX100 to
receive no annual incentive for the past three years.
The RRP also aligns 17,000 eligible non-executive employees to the Group’s recovery, with Rights to 1,000 Qantas shares in recognition
of their resilience, continued excellence in safety, ongoing loyalty and commitment. For many, this will be their first opportunity to own
Qantas shares associated with their employment with the Group.

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

Remuneration Outcomes in 2021/22

The Remuneration Outcomes for 2021/22 continue to reflect similar restraint and leadership in difficult times.
Fixed Remuneration:
In line with the Group’s two-year wage freeze, there were no increases to Base Pay during 2021/22 for the CEO and Executive
Management.
Variable Remuneration:
– The annual STIP did not operate in 2021/22.
The implementation of the RRP replaced the annual incentive opportunity for 2021/22. As a result, no annual incentive outcomes
will be paid in 2021/22, for the third year in a row.
– The Long Term Incentive Plan (LTIP) partially vested.
In the 2020-2022 LTIP, Qantas continued to deliver top quartile relative Total Shareholder Return (TSR) performance against the airline
peer group, ranking 2nd of the 18 airlines and resulting in full vesting for this component. However, the TSR performance condition
against the ASX100 peer group was not achieved, and as a result the Rights against this component lapsed.
Consequently, for Executive Management, 50 per cent of LTIP Rights vested and converted to shares. In accordance with the
shareholder approved governance changes in 2019, the vested LTIP shares will be subject to an additional one-year holding lock.
In relation to the 2020-2022 LTIP for the CEO, the CEO offered, and the Board agreed, to defer the decision as to whether his Rights
will be forfeited or allowed to convert to shares until at least August 2023 (and in alignment with this, have also further deferred the
decision on the 2019-2021 LTIP and 2018-2020 LTIP Rights).
The CEO’s total pay outcome for 2021/22 is higher than in 2019/20 and 2020/21, as he returned to receiving his contracted Base Pay
amount after voluntarily receiving reduced Base Pay for a seven-month period straddling the last two financial years.

Executive Remuneration Framework Review — 2022/23

In anticipation of a return to more normalised trading conditions during 2022/23, the Executive Remuneration Framework will revert
to its pre-pandemic structure of an annual STIP and LTIP grant. The annual STIP will return with UPBT as the primary financial measure,
which will have a weighting of 50 per cent of the STIP Scorecard.
Acknowledging our need to do more to deliver the service our customers expect, the STIP Scorecard will also have a higher weighting on
Customer, and include key operational priorities like Net Promoter Score (NPS), External Reputation/Trust and On Time Performance to
align Executive incentive outcomes to the customer experience.
In line with making sustainability a key pillar of decision making across all areas of the business and Qantas Group’s strategic objective to
reach a net zero emissions target by 2050, the existing ESG measures will be further enhanced to include a climate-related target from
our Qantas Group Climate Action Plan.

I invite you to review the 2022 Remuneration Report.

Jacqueline Hey
Chair, Remuneration Committee

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

1 REMUNERATION REPORT SUMMARY

The objectives of, and approach to, Qantas’ Executive Remuneration Framework are summarised as follows:

Remuneration Objectives Remuneration Effectiveness

– Supports Business Objectives: Encourages the pursuit – Oversight: Remuneration governance roles clearly defined
of growth and the success of Qantas. Aligned with Qantas’ for the Board; Remuneration Committee; Safety, Health,
purpose, values, strategy and risk appetite. Aligned with Environment and Security Committee; Audit Committee; and the
shareholder requirements. Board’s independent remuneration consultant (EY).
– Operates Sustainably: Encourages sound management – Structure: Design elements that reward for performance, but
of financial and non-financial risks. Encourages good conduct also protect against unintended or unjustified pay outcomes.
and discourages misconduct. Considers cost and reputational – Operation: Demonstrated history of aligning remuneration
factors and complies with relevant laws and regulations. outcomes with performance, appropriate application of Board
– Market Competitive: Attracts, motivates and appropriately discretion and adjusting remuneration outcomes based on
rewards a capable management team. individual performance and conduct.
– Quantum: Remuneration decisions made with reference
to comparable roles in other listed Australian companies.
A more detailed description is provided on pages 42 to 43.
The structure of the Executive Remuneration Framework is as follows:
Base Pay Fixed salary inclusive of superannuation Cash

Annual Incentive1 – An annual incentive opportunity Cash

Also referred to as the Short – Balanced scorecard
Term Incentive Plan (STIP) (financial and non-financial measures)
– Individual performance
Shares Deferral Period Additional Lock
(achievements and conduct)
– Delivered 2/3rds cash and 1/3rd shares
Clawback applies

Performance Restriction
Long Term Incentive – Awards of Rights 50% Rights may vest, subject to Qantas’ TSR performance Additional Lock
Also referred to as the Long relative to ASX100 companies
Term Incentive Plan – Qantas’ 3-year TSR performance relative to:
(LTIP) – A global airline peer group
– ASX100 companies 50% Rights may vest, subject to Qantas’ TSR performance Additional Lock
– Rights may convert to shares on vesting relative to airline peers
Restriction
Performance

Year 1 Year 2 Year 3 Year 4

1 The Board determined that the STIP would not operate in 2021/22. This was replaced by the RRP.

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

CHANGES TO THE REMUNERATION FRAMEWORK IMPLEMENTED FOR 2021/22

Talented Executives are in increasing demand across a range of industries. This was particularly impactful on Qantas during the COVID-19
pandemic as many other industries were — unlike aviation and tourism — experiencing high rates of growth. Experience shows that Qantas
Executives are highly sought after, and elevated attrition at three times pre-pandemic levels demanded an effective response to stabilise the
workforce. With this in mind, the Qantas Board approved a plan designed both to retain the Group’s key talent and to align and incentivise the
entire Qantas workforce for delivery of the Recovery Plan.
Changes to the Remuneration Framework Implemented for 2021/22
The Three-Year Recovery Plan, which commenced in 2020/21, has seen the Qantas Group operate in a cash-constrained environment amidst
ongoing uncertainty, particularly regarding the rate of recovery of the International business.
Therefore, the Board determined that the STIP would not operate in 2021/22 even though, like 2019/20 and 2020/21, the scorecard
for 2021/22 would otherwise have resulted in an award to Executive Management. Instead, the Board introduced a one-off, two-year,
performance based equity-based Recovery Retention Plan (RRP) designed to retain and reward Executives employed by the Qantas Group as
at 1 July 2021 and who remain employed in August 2023, which coincides with the timeframe for the delivery of the Three-Year Recovery
Plan. The RRP consists of an upfront grant of Rights to participants.
Shareholder approval for the CEO’s participation in the RRP and CEO’s grant of Rights under the RRP will be sought at the 2022 AGM, with
details of the calculation provided in Notice of Meeting.
All Rights issued under the RRP will vest and convert to Qantas shares only if the full performance and service conditions are achieved over
the two-year performance period. The performance conditions for the RRP are:
– The Qantas Group meets its $1 billion recovery program target by 30 June 2023.
– As at 30 June 2023, Qantas Group’s Net Debt range is below the top end of the Net Debt range as approved by the Board
in accordance with the Group’s Financial Framework.
– The Qantas Group is profitable on an UPBT basis for 2022/23.
The Board will retain discretion on vesting of the award in the event of a material safety failure.

2021/22 ANNUAL INCENTIVE PLAN

Annual Incentive — Structure 2021/22 STIP Scorecard:

Strategic Objective Range of Outcomes Outcome
The STIP is an annual incentive opportunity where an
Executive may receive an award that is a combination of cash and Financial Measures 0-45%
restricted shares if the plan’s performance conditions are Recovery Plan and Growth 0-30%
achieved. Customer 0-22.5%
Leading Domestic Market Recovery 0-30%
Workplace and Operational Safety 0-22.5%
Annual Incentive Outcomes for 2021/22
STIP Scorecard Outcome 0-150% 90%
2021/22 STIP Notwithstanding the Board determined that Target achieved or exceeded
Outcome the STIP would not operate in 2021/22 and Partial achievement against targets
be replaced by the RRP, in line with our No achievement against targets
performance culture, a Group STIP Scorecard
of performance measures was still set, with
the Board assessing performance against Further detail on the STIP is provided on pages 48 to 55.
each measure to determine an overall STIP
Scorecard outcome.
2021/22 STIP Each year, the Board aligns the performance
Scorecard measures that comprise the STIP Scorecard
with the Qantas Group’s strategic priorities.
For 2021/22, this involved aligning these
performance measures with the key financial,
operational and safety measures supporting
the Recovery Plan. For 2021/22, the Board
selected earnings generation, cash generation
and delivery of the Recovery Plan metrics as
the key financial performance measures for
the Qantas Group, with a weighting of 50 per cent
of the STIP Scorecard.
There was strong performance against both the
financial and non-financial components of the
STIP Scorecard that would have resulted in a
scorecard outcome 90 per cent (out of a
maximum 150 per cent) under the 2021/22 STIP
if it were operating.

38
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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

LONG TERM INCENTIVE PLAN

Long Term Incentive — Structure Long Term Incentive Outcomes for 2021/22
The LTIP is a 4-year plan that involves an upfront award of a fixed 2020-2022 Qantas’ 3-year relative TSR performance
number of Rights. If performance and service conditions are LTIP – was ranked:
achieved over a 3-year period, Rights vest and convert to Qantas Achievement – 2nd in the airline peer group —
shares which are then restricted for a further one-year. of performance condition fully achieved
Performance – 60th in the ASX100 — performance
Purpose Reward for longer term Qantas Group Conditions condition not achieved.
performance.
Based on this performance, 50 per cent
Target The number of Rights awarded under the vesting was achieved.
Opportunity LTIP has been calculated by applying a face
LTIP Notwithstanding that the LTIP performance
and Allocation value methodology to determine the maximum
Outcomes conditions were partially achieved, the CEO
Methodology number of Rights that may vest and convert to
offered, and the Board agreed, to defer the
Qantas shares. The target opportunity for the
decision until at least August 2023 as to whether
CEO and Executive Management is as follows:
his Rights will be forfeited or allowed to convert
Maximum Executive to shares. Therefore, the CEO’s LTIP outcome
Opportunity CEO Management in 2021/22 is nil.
% of Base Pay on 185% 95% For Executive Management, 50 per cent of Rights
a face value basis
awarded under the 2020-2022 LTIP vested and
converted to shares which are subject to a
further one-year trading restriction.
The number of Rights awarded is determined
Longer Qantas continued to outperform the majority
by applying the following formula:
Term TSR of its airline peers, achieving top quartile relative
Base Target Face Value Performance TSR performance for the seventh consecutive
x ÷
Pay Opportunity of Right rolling 3-year period.
Business Qantas’ 3-year Total Shareholder Return (TSR) However, Qantas’ TSR performance over the
Performance performance relative to: current 3-year performance period (to 30
June 2022) was below median compared to other
– A global airline peer group
ASX100 companies. Prior to COVID-19,
– ASX100 companies. Qantas had achieved continued longer term
share price growth, resulting in top quartile
Delivery If performance and service conditions relative TSR performance against the airline peer
are achieved, Rights vest and convert to Qantas group and ASX100 group over multiple rolling 3-
shares. A further one-year trading restriction on year periods.
vested shares applies, during which the shares
cannot be traded and are subject to clawback. QANTAS AND AIRLINE PEERS — 3-YEAR TSR PERFORMANCE1
0B

Disclosure In addition to the required statutory disclosures,

Qantas chooses to disclose the full value of LTIP
awards that vest during the year, disclosing the
value of the LTIP awards based on the share
price at the end of the performance period.

Further detail on the LTIP is provided on pages 50 to 52.

QANTAS ROLLING 3-YEAR RELATIVE TSR PERFORMANCE1 HISTORY

LTIP Period Airline Peer Group ASX100 Peer Group
2020-2022 Top quartile Below median
2019-2021 Top quartile Below median
2018-2020 Top quartile Below median
2017-2019 Top quartile Top quartile
2016-2018 Top quartile Top quartile
2015-2017 Top quartile Top quartile
2014-2016 Top quartile Top quartile

1 TSR performance, applying the LTIP performance test methodology (which uses the
average closing share price over the six months preceding the test date of
30 June 2022).

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

REMUNERATION OUTCOMES FOR THE CEO IN 2021/22

CEO Remuneration Outcomes — Key Points

The CEO remuneration outcomes demonstrate the commitment from the CEO and Board to align reward outcomes with business
performance and the prevailing economic challenges that Qantas, its shareholders, employees and customers are experiencing.
The CEO’s total pay outcome for 2021/22 was 15 per cent higher than 2020/21 as he returned to receiving his contracted Base Pay
amount after voluntarily receiving reduced pay for seven months straddling the last two financial years.

Base Pay CEO REMUNERATION OUTCOMES — BASE PAY (CASH)

1B

The CEO did not receive a Base Pay increase during 2021/22.
However, in contrast to 2020/21 — where the CEO received no
Base Pay in July 2020 and received only 65 per cent of his Base
Pay from August through 31 October 2020 — in 2021/22 the
CEO returned to receiving his contracted Base Pay amount.
Base Pay (cash) is $2,146,432 (Base Pay of $2,170,000 less
superannuation contributions of $23,568).

Annual Incentive — 2021/22 STIP CEO REMUNERATION OUTCOMES — ANNUAL INCENTIVE

2B

The CEO received no annual STIP opportunity under the 2021/22

STIP as the plan did not operate, being replaced by the RRP for
2021/22 only. Shareholder approval will be sought at the 2022
AGM for the CEO’s participation in the RRP and for the CEO’s grant
of rights under the plan.
1 The implementation of the RRP replaced the annual STIP opportunity for 2021/22.
As a result, no annual STIP awards were paid for 2021/22.

Long Term Incentive — 2020-2022 LTIP CEO REMUNERATION OUTCOMES — LONG TERM INCENTIVE
3B

Qantas’ TSR performance over the 3-year performance period for

the 2020-2022 LTIP would have allowed 50 per cent of the CEO’s
Rights to vest and convert to Qantas shares. However, the CEO
offered, and the Board agreed, to defer the decision until at least
August 2023 as to whether his 371,500 Rights under the 2020-
2022 LTIP be forfeited or allowed to convert to shares.
Concurrently, the decision on whether to forfeit or allow the
325,500 Rights under the 2019-2021 LTIP and 343,500 Rights
under the 2018-2020 LTIP was also deferred until at least August
2023. As a result, the CEO’s LTIP outcome for 2021/22 was zero.

Actual Remuneration Outcomes for the CEO for 2021/22 Statutory Remuneration Disclosures
The remuneration outcomes for the CEO in 2021/22 are detailed in The statutory remuneration disclosures for the CEO are prepared
the following table. in accordance with Australian Accounting Standards.
2022 vs The statutory disclosures differ from the actual remuneration
2022 2021 2021 %
outcomes for the CEO due to the accounting treatment of share-
CEO Remuneration Outcomes 1,2
$’000 $’000 change
based payments for the STIP and LTIP.
Base Pay (cash) 2,146 1,778 21%
STIP — cash bonus - - -
STIP — share-based - - - 2022 2021
CEO Statutory Remuneration $’000 $’000
LTIP - - -
Base Pay (cash) 2,146 1,778
Other 126 201 n/a
STIP — cash bonus - -
Total Actual Outcome 2,272 1,979 15%
STIP — share-based 31 237
1 Details of the non-statutory remuneration methodology are explained on pages 48 LTIP 3,272 3,072
and 53.
2 A reconciliation of remuneration outcomes to statutory remuneration disclosures Other 126 201
is provided on page 47. Total 5,575 5,288

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

CEO Remuneration Outcomes History (2012/13 to 2021/22)

Qantas’ incentive awards are designed to align Executive remuneration outcomes with business performance. This alignment is
demonstrated each year in the variability of the incentive plan outcomes for the CEO.
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Underlying PBT ($M) $186 ($646) $975 $1,532 $1,401 $1,565 $1,326 $124 ($1,774) ($1,859)
ROIC %1 (1.5%) 16.2% 22.7% 20.1% 21.4% 19.2% 5.8% (21.4%) (31.6%)

1 ROIC % information is only available from 2013/14.

2 The CEO offered, and the Board agreed, to defer the decision until at least August 2023 as to whether his 371,500 Rights under the 2020-2022 LTIP be forfeited or allowed to
convert to shares. This will also apply to 325,500 Rights under the 2019-2021 LTIP and 343,500 Rights under the 2018-2020 LTIP.
3 The Board determined that the STIP would not operate in 2021/22. This was replaced by the RRP. Shareholder approval will be sought at the 2022 AGM for the CEO’s participation
in the RRP and for the CEO’s grant of rights under the plan.

CHANGES TO THE REMUNERATION FRAMEWORK FOR 2022/23

The Remuneration Framework remains aligned with the business strategy and has been adapted to reflect the priorities and areas of focus
at each stage of the COVID-19 pandemic and the Recovery Plan. Looking ahead to 2022/23 and in anticipation of a return to more
normalised trading conditions, the following changes were made to the Framework.

STIP Scorecard for 2022/23

Each year, the Board aligns the performance measures that comprise the STIP Scorecard with the key financial, operational and safety
measures that reflect the Qantas Group’s strategic priorities. For 2022/23, the focus is on supporting the next phase of the Recovery Plan,
including ensuring that the Group airlines’ operational performance improves to match the high standards we set and which our customers
expect.
With the planned return to profitability for 2022/23, the Board has returned to UPBT as the primary financial measure. The UPBT
is adjusted for budgeted Transformation costs and will have a weighting of 50 per cent of the STIP Scorecard.
Acknowledging our need to do more to deliver the service our customers expect, the STIP Scorecard will have an increased weighting to
Customer, and prioritise a combination of key operational measures like punctuality and reliability of our airlines, customer satisfaction
(measured in NPS) and the Group’s reputation and trust, to align Executive incentive outcomes to our customers’ experience.
While Qantas’ STIP Scorecard has previously included Environment, Social & Governance (ESG) metrics that relate to the ‘S’ and ‘G’
components, the scope of Qantas’ ambition has continued to grow and broaden to embrace growing stakeholder concerns around
the environment, in particular, climate change. In line with Qantas’ strategic objective to reach a net zero emissions target by 2050, the
existing suite of ESG measures will be enhanced to include an environment-related target from our Qantas Group Climate Action Plan
(CAP). Decarbonisation is a strategic priority and the key focus of our CAP and targets. Aligned to our strategic objective and interim target
of achieving a 25 per cent reduction in net emissions from 2019 levels by 2030, a CO2 emissions reduction target will be included in the
STIP Scorecard with a weighting of 5 per cent. The combination of the Group’s focus on improving customer experience, maintaining the
Group’s renowned safety performance and implementing our climate commitments will see the prominence of key ESG targets represent
40 per cent of the STIP Scorecard.
The Board believes that these changes to the Remuneration Framework appropriately support the Qantas Group’s key business priorities
for 2022/23.

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

REMUNERATION REPORT FOR 2021/22

The Remuneration Report sets out remuneration information for the CEO, Executive Management, who are Key Management Personnel (KMP)
and Non-Executive Directors. Section 300A of the Corporations Act 2001 (Cth) requires disclosure of remuneration information for KMP, with
KMP defined in Australian Accounting Standard AASB 124 Related Party Disclosures as those persons having authority and responsibility for
planning, directing and controlling the activities of the entity, directly or indirectly, including any Director (whether Executive or otherwise) of that
entity.
CEO and Executive Management (and their statutory remuneration disclosures) are listed on page 46. Non-Executive Director KMP (and their
statutory remuneration disclosures) are listed on page 61.

2 REMUNERATION GOVERNANCE
The objectives of Qantas’ Executive Remuneration Framework are to:
– Support Business Objectives by:
– Encouraging the pursuit of growth and the success of Qantas
– Aligning with Qantas’ purpose, values, strategy and risk appetite
– Aligning with shareholder requirements.
– Operate Sustainably by:
– Encouraging the sound management of financial and non-financial risks
– Encouraging good conduct and discouraging misconduct
– Considering cost and reputational factors and complying with relevant laws and regulations.
– Be Market Competitive to attract, motivate and appropriately reward a capable management team.
These objectives are achieved by the Board applying a robust approach to remuneration governance and effectiveness across the areas of
oversight, structure, operation and quantum as described below:

Oversight The remuneration governance roles of the Board; the Remuneration Committee; the Safety, Health, Environment and
Security Committee; the Audit Committee; and the Board’s independent remuneration consultant Ernst & Young (EY)
are each clearly defined.
The Remuneration Committee (a committee of the Board, whose members are detailed on pages 9 to 11) has the role of
reviewing and making recommendations to the Board on specific remuneration matters at Qantas. The Committee
makes recommendations it believes are appropriate from the perspective of business performance, individual
performance and conduct, risk, governance, quantum and market conditions.
The Safety, Health, Environment and Security Committee and the Audit Committee have appropriate input into
remuneration decision making. The Chairs of both committees regularly attend Remuneration Committee meetings and
provide written input into remuneration decision making. A member of the Remuneration Committee is also a member
of the Safety, Health, Environment and Security Committee and the Audit Committee. All Board members are invited
and eligible to attend Remuneration Committee meetings.
During 2021/22, the Remuneration Committee commenced a tender process for the role of remuneration consultant. At
the conclusion of the tender process it was determined EY would continue as its remuneration consultant. The
Remuneration Committee has established protocols in relation to the appointment and use of remuneration
consultants to support compliance with the Corporations Act 2001 (Cth), which are incorporated into the terms of
engagement with EY.
The Remuneration Committee did not seek, nor receive, a formal remuneration recommendation (as defined
in the Corporations Act 2001 (Cth)) during 2021/22.

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

Structure The Framework has design elements that protect against the risk of unintended and unjustified pay outcomes.
These design elements include:
– Diversity in incentive plan performance measures, which as a suite of measures cannot be directly
or imprudently influenced by any individual employee
– Individual performance defined and assessed in terms of both achievements and conduct
– The Board retaining discretion over remuneration outcomes
– Clear maximum values specified for STIP Scorecard outcomes and a challenging vesting scale under the LTIP
– Diversity of the timeframes within which performance is measured, with performance under the STIP measured over
one year and performance under the LTIP measured over three years
– Deferral of a portion of awards under the STIP for two years, with an additional one-year trading restriction providing
further alignment with shareholder interests
– Deferral of Rights that vest and convert to shares under the LTIP, with shares subject to a one-year trading
restriction to provide further alignment with shareholder interests
– A clawback mechanism available in the event of serious misconduct, breach of obligations to the Group
or a material misstatement in Qantas’ Financial Statements. The Board may:
– Determine that an Executive forgoes some or all awards otherwise due under the STIP
– Deem some or all STIP shares, which are subject to a deferral period and/or additional one-year trading
restriction, be forfeited
– Cause some or all LTIP or RRP Rights which have not yet vested to lapse, or LTIP Rights which have vested
and converted to shares that are subject to a trading restriction to be forfeited
– In the case of serious misconduct, cancel any post-employment benefits for the relevant employee(s)
(where possible).

Operation The Qantas Board has a demonstrated history of aligning remuneration outcomes with Group performance. The Board
has applied its discretion in the past to ensure remuneration outcomes are appropriate and has adjusted individual
remuneration outcomes based on performance and conduct.
Examples of where the Board has applied its discretion, including in both 2019/20 and 2020/21, are provided on
page 49.

Quantum Base Pay and incentive plan opportunities are set with reference to external market data, including comparable roles in
other listed Australian companies. Remuneration is benchmarked against ASX50 companies and a revenue-based peer
group of other listed Australian companies.
The Board believes these are the appropriate benchmarks, as these are the comparator groups whose roles best mirror
the size, complexity and challenges in managing Qantas’ businesses. They are also the peer groups with which Qantas
competes for Executive talent.

EMPLOYEE SHARE TRADING POLICY

The Qantas Code of Conduct and Ethics contains Qantas’ Employee Share Trading Policy (Policy). The Policy prohibits employees from dealing
in Qantas securities (or securities of other listed or unlisted entities) while in possession of material non-public information relevant to the
entity.
In addition, nominated employees (including the CEO and Executive Management) and Non-Executive Directors are:
– Prohibited from dealing in Qantas securities (or the securities of any Qantas Group listed entity) during defined closed periods
– Required to comply with ‘request to deal’ procedures prior to dealing in Qantas securities (or the securities of any Qantas Group
listed entity) outside of defined closed periods
– Prohibited from hedging, entering into any margin lending arrangement, or entering into any other encumbrances over the securities of
Qantas (or the securities of any Qantas Group listed entity) at any time.

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

3 REMUNERATION OUTCOMES FOR 2021/22

The following table summarises the remuneration decisions and outcomes for the CEO and Executive Management for the year ended
30 June 2022. The remuneration outcomes detailed in this table are better aligned to current year performance and are therefore particularly
useful in understanding current year pay and its alignment with performance, in comparison to the statutory remuneration disclosures.
The 2020-2022 LTIP performance measures, being Qantas’ TSR relative to companies with ordinary shares included in the ASX100 and
an airline peer group (Global Listed Airlines), were tested as at 30 June 2022. Qantas’ three-year relative TSR performance was ranked 2nd
in the airline peer group and 60th in the ASX100. Based on this performance, 50 per cent vesting was achieved. The shares awarded to
Executive Management upon vesting of the LTIP remain subject to an additional one-year trading restriction. Notwithstanding that the LTIP
conditions were partially achieved, the CEO offered, and the Board agreed, to defer the decision as to whether his Rights will be forfeited or
allowed to convert to shares until at least August 2023. Concurrently, the decision on whether to forfeit or allow the CEO’s Rights under the
2019-2021 LTIP and 2018-2020 LTIP to convert to shares was also deferred until at least August 2023. Therefore, the CEO’s LTIP outcome in
2021/22 is nil.

Actual Remuneration Outcomes Table — CEO and Executive Management1

Base
Pay STIP Cash STIP Deferred Other
$’000s (Cash)2 Bonus3 Award3 RRP LTIP4,5 Benefits6 Total
Current Executives
Alan Joyce 2022 2,146 - - - - 126 2,272
Chief Executive Officer 2021 1,778 - - - - 201 1,979
Andrew David 2022 996 - - - 401 59 1,456
CEO Qantas Domestic
2021 936 - - - 367 108 1,411
and International

Gareth Evans 2022 1,057 - - - 425 101 1,583

CEO Jetstar Group 2021 1,005 - - - 388 64 1,457
Vanessa Hudson 7 2022 921 - - - 334 183 1,438
Chief Financial Officer 2021 875 - - - 145 182 1,202
Olivia Wirth 2022 843 - - - 341 67 1,251
CEO Qantas Loyalty 2021 802 - - - 311 141 1,254
Total 2022 5,963 - - - 1,501 536 8,000
2021 5,396 - - - 1,211 696 7,303
1 Details of the non-statutory remuneration methodology are explained on pages 48 and 53.
2 Base Pay (Cash) is Base Pay less superannuation contributions. Superannuation is reported in Other Benefits.
3 The full value of STIP awards made to each Executive is calculated by adding the STIP Cash Bonus and the STIP Deferred Award. For 2020/21 the value is nil as no award was made.
The Board determined that STIP would not operate in 2021/22, and as a result, this is also nil. The 2021/22 STIP was replaced by the RRP.
4 LTIP awards vested in 2021/22 at 50 per cent for Executive Management other than the CEO. The CEO offered, and the Board agreed, to defer the decision until at least August 2023
as to whether his Rights will be forfeited or allowed to convert to shares. The decision for the CEO’s LTIP award for 2020/21 and 2019/20 were further deferred until August 2023.
5 The number of Rights vested multiplied by the Qantas share price of $4.47 at 30 June 2022 (the end of the plan’s performance period) (2021: $4.66 at 30 June 2021).
6 Other Benefits are detailed on page 53.
7 Superannuation benefits are provided through a defined benefit superannuation plan. The amount disclosed has been measured in accordance with AASB 119 Employee Benefits.

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

4 STATUTORY REMUNERATION DISCLOSURES FOR 2021/22

The statutory remuneration disclosures for the year ended 30 June 2022 are detailed below. These are prepared in accordance with
Australian Accounting Standards and differ from the 2021/22 remuneration outcomes on page 44. The differences arise due to the
accounting treatment of share-based payments for the STIP, RRP and LTIP, as the statutory disclosures include an accounting remuneration
value for:
– Prior years’ STIP awards
Accounting standards require STIP remuneration to be expensed (and therefore included as statutory remuneration) in financial
years which differ from the year of scorecard performance.
Despite no awards being made under either the 2019/20 or the 2020/21 STIP, a value for STIP awards is still required to be included
in the statutory remuneration table. This is due to the fact that deferred shares granted under the 2018/19 STIP have a future service
period, during which the recipient must remain employed by the Group for the awards to vest. Therefore, the 2020/21 and 2021/22
statutory remuneration disclosures include a value for part of those prior year STIP awards.
– RRP award that has not vested
Accounting standards require RRP remuneration to be expensed (and therefore included as statutory remuneration)
over the relevant performance and service period.
Testing of the RRP Award will be undertaken as at 30 June 2023 to determine if Rights convert to shares.
– LTIP awards that have not vested
Accounting standards require LTIP remuneration to be expensed (and therefore included as statutory remuneration) notwithstanding that
some of the Rights have not met the performance hurdles and have lapsed.
The performance measures for the 2020-2022 LTIP, being Qantas’ TSR relative to companies with ordinary shares included in the ASX100
and an airline peer group (Global Listed Airlines), were tested as at 30 June 2022. Qantas’ three-year relative TSR performance was ranked
2nd in the airline peer group and 60th in the ASX100. Based on this performance, 50 per cent vesting was achieved. Notwithstanding that the
LTIP conditions were partially achieved, the CEO offered, and the Board agreed, to defer the decision until at least August 2023 as
to whether his Rights will be forfeited or allowed to convert to shares. For Executive Management, 50 per cent of Rights awarded under the
2020-2022 LTIP vested and converted to shares, with the remaining Rights lapsing. Even though 50 per cent of Rights lapsed, the
Statutory Remuneration recognises an expense for 100 per cent of Rights under the 2020-2022 LTIP.
Additionally, LTIP awards that will be assessed for vesting in future years are expensed over the three-year testing period. Therefore,
the statutory disclosures include an accounting value for part of the 2021-2023 and the 2022-2024 LTIP awards.

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

Statutory Remuneration Table — CEO and Executive Management

Incentive Plan — Accounting Accrual Other Benefits
Equity-Settled
Share-Based Payments
STIP STIP Post- Other
Base Pay Cash Deferred RRP LTIP Sub- Non-Cash Employment Long-Term Sub-
$’000s (Cash)1,2
Bonus1 Shares Rights3 Rights Total Benefits1,4 Benefits Benefits6 Total
5
Total
Current Executives
Alan Joyce 2022 2,146 - 31 - 3,272 5,449 23 46 57 126 5,575
Chief Executive Officer 2021 1,778 - 237 - 3,072 5,087 2 53 146 201 5,288
Andrew David 2022 996 - 10 291 771 2,068 11 51 (2) 60 2,128
CEO Qantas Domestic 2021 936 - 80 - 680 1,696 4 56 48 108 1,804
and International

Gareth Evans7 2022 1,057 - 12 308 817 2,194 46 52 4 102 2,296

CEO Jetstar Group 2021 1,005 - 94 - 720 1,819 10 56 (2) 64 1,883
Vanessa Hudson 8
2022 921 - 8 291 716 1,936 34 144 5 183 2,119
Chief Financial Officer 2021 875 - 59 - 520 1,454 4 138 40 182 1,636
Olivia Wirth 2022 843 - 10 247 655 1,755 8 52 7 67 1,822
CEO Qantas Loyalty 2021 802 - 74 - 567 1,443 15 57 69 141 1,584
Total 2022 5,963 - 71 1,137 6,231 13,402 122 345 71 538 13,940
2021 5,396 - 544 - 5,559 11,499 35 360 301 696 12,195
1 Short-term employee benefits include Base Pay (cash), STIP cash bonus and non-cash benefits.
2 Base Pay (Cash) is Base Pay less superannuation contributions. Superannuation is reported in Post-Employment Benefits.
3 Shareholder approval will be sought at the 2022 AGM for the CEO’s participation in the RRP and for the CEO’s grant of rights under the plan. If shareholder approval is received, the
accounting remuneration value will be included in the statutory remuneration table in the 2023 Remuneration Report. The total remuneration value will be equal to the number of
rights issued under the RRP multiplied by the fair value of the right at grant date (which if approved, would be the date of the AGM) and will be recognised over the vesting period to
August 2023.
4 Non-cash benefits include the value of travel benefits while employed and other minor benefits.
5 Post-Employment Benefits includes superannuation and an accrual for post-employment travel of $22,000 for Mr Joyce and $28,000 for each other Executive (2021: $30,000 for
Mr Joyce and $34,000 for each other Executive).
6 Other Long-Term Benefits include movement in annual leave and long service leave balances. The accounting value of Other Long-Term Benefits may be negative; for example,
where an Executive’s annual leave balance decreases as a result of taking more annual leave than they accrue during the current year.
7 Mr Evans will cease employment with Qantas during 2023. In the event that Mr Evans ceases employment prior to the end of the performance period, the Rights under the 2021-
2023 LTIP, 2022-2024 LTIP and the RRP will continue to remain on foot on a pro-rata basis for the portion of the performance period in which Mr Evans was employed, consistent
with the Terms and Conditions of those plans as a good leaver. The Rights may vest and convert to shares at the end of the performance period subject to achievement of the
original respective performance conditions. Any shares allocated following vesting of the LTIP will be subject to a one-year trading restriction.
8 Superannuation benefits are provided through a defined benefit superannuation plan. The amount disclosed has been measured in accordance with AASB 119 Employee Benefits.

On 24 June 2022, the Group announced that the Jetstar CEO, Mr Evans, had made the decision to step down from his current role in
December 2022 and will remain with the Group on key projects before leaving during 2023.

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

A reconciliation of the CEO’s remuneration outcome to the statutory disclosures is detailed below as an example.
CEO’s Statutory Remuneration Disclosure to Remuneration Outcome for 2021/22
Reconciliation ($’000s) Description
Statutory Remuneration Disclosure 5,575
Accounting value of share-based payments The Statutory Remuneration Disclosure includes the accounting value of
– Less: Accounting value for STIP share awards (31) share-based payments. Accounting standards require share-based
payments to be amortised over the relevant performance and service
– Less: Accounting value for LTIP share awards (3,272) periods. For 2021/22, the Statutory Remuneration Disclosure includes:
– A value resulting from the expense of deferred shares from
the 2018/19 STIP awards. The STIP did not operate in 2021/22.
Furthermore, no value was included for the 2019/20 or 2020/21
STIP as the CEO did not receive an award under either of these plans
– A value resulting from the expense of LTIP Rights from the 2019-
2021, 2020-2022, 2021-2023 and 2022-2024 LTIP awards. Statutory
remuneration includes the full expense of LTIP Rights irrespective
of whether performance conditions are achieved or expected
to be achieved. For the 2020-2022 LTIP, the CEO offered, and the
Board agreed, to defer the decision until at least August 2023 as to
whether his Rights will be forfeited or allowed to convert to Shares
– The CEO’s LTIP outcome in 2021/22 is nil but a value is still included as
statutory remuneration. If Rights convert to shares, the value of the
award of the 2020-2022 LTIP will be disclosed in the Remuneration
Outcome for that year. Testing for the 2021-2023 and 2022-2024
LTIP awards will be undertaken as at 30 June 2023 and 30 June
2024, respectively, to determine whether the CEO receives any
shares under these awards.
Current year STIP share awards and vesting In a year where STIP share awards are made or LTIP awards vest,
of LTIP awards the Remuneration Outcomes disclosure includes:
– The full value of STIP shares awarded even though these awards
are still subject to a two-year deferral period and an additional
– Add: 2020-2022 LTIP vesting nil one-year trading restriction
– The full value of the shares that vested under the LTIP even
where these shares are subject to an additional one-year
trading restriction.
The CEO received no opportunity under the 2021/22 STIP as the plan did
not operate. No LTIP award was made to the CEO in 2021/22 and
therefore these values are nil.
Remuneration Outcome — Total 2,272

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Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

5 EXECUTIVE REMUNERATION STRUCTURE

The Qantas Executive Remuneration Framework, as it applies to the CEO and Executive Management, is summarised on pages 37 to 41.
Additional detail on the structure and operation of each element of the Framework is provided below.

Base Pay
(also referred to Base Pay is a guaranteed salary level, inclusive of superannuation. Each year, the Remuneration Committee reviews the
as Fixed Annual Base Pay for the CEO and Executive Management. An individual’s Base Pay, being a guaranteed salary level, is not related
Remuneration) to Qantas’ performance in a specific year.
Base Pay (Cash), as disclosed in the remuneration tables, excludes superannuation (which is disclosed as Post-
Employment Benefits) and includes salary sacrifice components such as motor vehicles.
In performing a Base Pay review, the Board makes reference to external market data including comparable roles
in other listed Australian companies. Remuneration is benchmarked against ASX50 companies and a revenue-based peer
group of other listed Australian companies. The Board believes these are the appropriate benchmarks, as these are the
comparator groups whose roles best mirror the size, complexity and challenges in managing Qantas’ businesses, and
they are also the peer groups with whom Qantas competes for Executive talent.
In line with the Group-wide two-year wage freeze, there were no Base Pay increases for the CEO and Executive
Management during 2021/22.
The Base Pay for the CEO and Executive Management is outlined on page 56.

Annual Incentive
STIP Overview The STIP is the annual incentive plan for the CEO and members of Qantas Executive Management. Each year,
the Executives may receive an award that is a combination of cash and restricted shares to the extent that the
Plan’s performance conditions are achieved.
For 2021/22, the Board determined that STIP would not operate. This was replaced by the RRP.

Calculation of STIP awards are calculated as follows:

STIP Awards
STIP Target STIP Scorecard Individual Performance
= Base Pay X X X
Award Opportunity Outcome Factor

Target Opportunity In a year where STIP operates, each STIP participant has a Target Opportunity expressed as a percentage of Base Pay:
– For the CEO, 100 per cent of Base Pay
– For Executive Management, 80 per cent of Base Pay.

Performance Notwithstanding the Board determined that STIP would not operate in 2021/22, the Board set a scorecard of performance
Conditions — measures for 2021/22.
STIP Scorecard
The STIP Scorecard contains a mix of Group financial and non-financial measures.
For 2021/22, the Board selected earnings generation, cash generation and Recovery Plan metrics as the key financial
performance measures for the Qantas Group, with a weighting of 50 per cent.
Other financial and non-financial measures comprise the remaining 50 per cent of the STIP Scorecard. The Board sets
targets for each STIP Scorecard measure. At the end of the financial year, the Board assesses performance against each
measure and determines the overall STIP Scorecard outcome.
A detailed description of the STIP Scorecard measures and the 2021/22 STIP Scorecard outcome is provided on pages 54
to 55.

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For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

Performance An individual’s performance is recognised via an IPF. The IPF is a measure of individual performance that assesses:
Conditions —
– What an individual has achieved
Individual
Performance – How they went about it (their conduct and behaviours).
Factor (IPF) An individual’s behaviour is assessed against the Qantas Group Beliefs. The Qantas Group Beliefs are:
– Everyone has the right to return home safely
– Customers determine our success
– Being a fit, agile and diverse organisation drives innovation and simplicity
– Working together in an inclusive manner always delivers the optimal Group outcome
– Each employee deserves respect, trust and good leadership.
IPFs are generally in the range of 0.8 to 1.2. However, in the case of underperformance the IPF may be zero.
In exceptional circumstances the IPF may be as high as 1.5.

Board Board discretion is a key element of the design of the STIP.

Discretion
While the Board sees the STIP Scorecard as fundamental in calculating the STIP, it also recognises that remuneration
outcomes must be considered in the broader context of Qantas’ overall business performance, the operating
environment and non-financial considerations. Circumstances may occur where scorecard measures have been
achieved or exceeded, but in the view of the Board it is more appropriate to make no award under the STIP or to deliver a
higher proportion of an award in Qantas shares. Likewise, there may be circumstances where performance is below an
agreed target where the Board may determine that it is appropriate to pay a partial STIP award (this circumstance has
not occurred to date).
Therefore, each year the Board considers whether to apply its discretion. The Board may determine that:
– No award be made (as it did in 2011/12, 2013/14, 2019/20 and 2020/21)
– Only a partial award be made (as it did in 2010/11 and 2012/13)
– Any award will be entirely deferred and/or delivered in Qantas shares (as it did in 2010/11)
– A higher proportion of the award be made in Qantas shares (as it did in 2016/17)
– Any award be reduced (as it did in 2018/19).

Delivery of In a year where STIP awards are made, two thirds of the STIP award would be paid as a cash bonus, with the remaining
STIP Awards one third deferred into Qantas shares.

STIP Award In a year where STIP awards are made, any shares awarded would be subject to:
Deferral
– A two-year deferral period, and
and Trading
Restriction – A one-year trading restriction. The trading restriction would apply to these shares both during employment and post-
cessation of employment. Shares subject to the trading restriction are not forfeited on cessation of employment but
are subject to clawback
The additional trading restriction strengthens the ability to clawback vested equity, if required.

Maximum and The maximum outcome under the STIP is capped at 200 per cent of Base Pay for the CEO and 160 per cent of Base Pay
Minimum STIP for other Executive Management.
Outcome
The minimum outcome is nil, which would occur if the threshold level of performance is missed on each STIP measure, if
an individual’s performance does not warrant an award, or if the Board determines that no award be made.

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For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

Cessation of In general, where an Executive resigns, is terminated for cause or is terminated in other circumstances involving
Employment unacceptable performance or conduct, they forfeit any right to participate in that year’s STIP and forfeit any shares
(current plan) awarded under prior year STIPs that are subject to a deferral period.
For shares subject to the additional trading restriction, forfeiture does not apply. That is, for any shares awarded under
prior year STIPs where the deferral period has been served, but the shares are subject to the additional
trading restriction, the Executive retains those shares subject to the additional trading restriction.
The additional trading restriction strengthens the ability to clawback vested equity, if required.
In limited circumstances, for example, retirement, employer-initiated terminations (with no record of poor performance),
death or total and permanent disablement:
– For the current year STIP, the Executive will receive a pro-rated award based on the actual performance against
the performance measures (as determined by the Board following the end of the performance period), and
the portion of the performance period that the Executive served.
– For shares awarded under prior year STIPs that are subject to a deferral period, the original deferral period
and additional trading restriction continue to apply and these shares are subject to clawback.

Disclosure In addition to required statutory disclosures, Qantas chooses to disclose the full value of each year’s STIP award
in the Remuneration Outcomes Table on page 44. This involves disclosing both:
– The value of cash awards made
– The full value of restricted shares that were awarded (notwithstanding that these shares are still subject
to a two-year deferral period and a one-year trading restriction).
No awards were made under the 2021/22 STIP as the plan did not operate. Therefore, the value for the 2021/22 STIP is nil.
Disclosure of STIP awards in the Statutory Remuneration Table on page 46 is based on the requirements of the
Corporations Act 2001 (Cth) and applicable Australian Accounting Standards. The STIP awards are disclosed as either:
– A cash incentive for any cash bonus paid, or
– A share-based payment for any component awarded in deferred shares.
Where share-based STIP awards involve deferral over multiple reporting periods, they are reported against each period in
accordance with accounting standards.

Long Term Incentive Plan (LTIP)

LTIP Overview The LTIP is a four-year plan that involves an upfront award of a fixed number of Rights over Qantas shares.
If performance and service conditions are achieved over a three-year period, Rights vest and convert to Qantas shares.
The vested shares are then subject to a further one-year trading restriction during which the shares cannot be traded
and are subject to clawback.
If the three-year performance conditions or service conditions are not met, the Rights lapse.

Performance The performance measures for each of the 2020-2022 LTIP (tested at 30 June 2022), 2021-2023 LTIP (to be tested
Conditions at 30 June 2023) and 2022-2024 LTIP (to be tested at 30 June 2024) are Qantas’ TSR relative to:
– A global airline peer group
– ASX100 companies.
Up to 50 per cent of the total number of Rights granted may vest based on Qantas’ TSR performance in comparison to
the global airline peer group, and up to 50 per cent of the total number of Rights granted may vest based on Qantas’ TSR
performance in comparison to the ASX100 companies.
These Rights will only vest in full if Qantas’ TSR performance ranks at or above the 75th percentile compared to both the
global airline peer group and the ASX100 companies. At the end of the performance period, the TSR performance of
Qantas and each comparator company is determined based on their average closing share price over the final six
months of the three-year performance period.
The peer groups selected are because Qantas’ Financial Framework targets top quartile TSR performance relative
to global airline peers and ASX100 companies as these provide a comparison of relative shareholder returns relevant to
most Qantas investors:
– The global airline peer group was chosen for relevance to investors, including investors based outside Australia,
with a primary interest in the aviation industry sector
– The ASX100 peer group was chosen for relevance to investors with a primary interest in the equity market for major
Australian listed companies (of which Qantas is one).

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For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

The vesting scale for both the ASX100 and the global listed airline peer groups is as follows:
Qantas’ TSR Performance Relative to Each Peer Group Vesting Scale
Below 50th percentile Nil vesting
50th to 75th percentile Linear scale: 50 per cent to 100 per cent vesting
Above 75th percentile 100 per cent vesting
The ASX100 peer group comprises those companies that make up the S&P/ASX100 Index at the commencement of the
performance period.
The global listed airline peer group has been selected with regard to its representation of Qantas’ key markets,
full-service and value-based airlines and the level of government involvement. For the 2020-2022 LTIP, the global listed
airline peer group comprised: AirAsia, Air France/KLM, Air New Zealand, All Nippon Airways, American Airlines, Cathay
Pacific, Delta Airlines, Deutsche Lufthansa, easyJet, International Consolidated Airlines Group, Japan Airlines, LATAM
Airlines Group, Ryanair, Singapore Airlines, Southwest Airlines, United Continental and Virgin Australia. The peer group
for the 2021-2023 LTIP and 2022-2024 LTIP was consistent, other than Virgin Australia, which was excluded (from the
2021-2023 LTIP) due to entering voluntary administration and subsequently (from the 2022-2024 LTIP) privatised.

Review of The Remuneration Committee regularly reviews the appropriateness of the performance measures. In 2021/22, the
Performance Remuneration Committee determined that the current measures continue to remain the most appropriate. These
Conditions measures are aligned with returns achieved for shareholders and are consistent with the Group Financial Framework.

Vesting of If performance and service conditions are achieved over a three-year period, Rights vest and convert to Qantas shares.
LTIP Award

Trading Restriction Any shares awarded under the LTIP will be subject to a one-year trading restriction.
(commencing with
Shares subject to the trading restriction are not forfeited on cessation of employment but are subject to clawback.
2020-2022 LTIP)
The additional trading restriction strengthens the ability to clawback vested equity, if required.

Cessation of In general, when an Executive resigns, is terminated for cause or is terminated in other circumstances involving
Employment unacceptable performance or conduct, any Rights which have not vested will be forfeited. For any shares awarded under
(commencing the LTIP that are now subject to an additional trading restriction, the Executive will continue to hold those shares and the
with 2020-2022 additional trading restriction continues to apply. That is, forfeiture does not apply to those shares during the trading
LTIP) restriction period. These shares are subject to clawback.
In limited circumstances, for example, retirement, employer-initiated terminations (with no record of poor performance),
death or total and permanent disablement, Rights will remain on foot on a pro-rata basis and may vest at the end of the
performance period, subject to the satisfaction of the relevant performance and service conditions of the LTIP. Any
shares allocated following vesting of the LTIP will be subject to a trading restriction.

Allocation The number of Rights granted to the CEO and Executive Management under the LTIP is calculated on a face value basis
Methodology and is the maximum that may vest at the end of the performance period.
The maximum LTIP opportunity for the CEO and Executive Management is provided on a face value basis in the
Summary of Key Contract Terms on page 56.

Allocation At each year’s Annual General Meeting (AGM), Qantas seeks shareholder approval for any award of Rights to the CEO. At
Methodology the 2021 AGM, shareholders approved an award of 861,000 Rights to the CEO (under the 2022-2024 LTIP), being the
Used in 2021/22 maximum number of Rights that may vest and convert to shares.
Award to the CEO
The Notice of Meeting for the 2021 AGM set out the proposed number of LTIP Rights to be granted to the CEO on a face
value basis as follows:

Base Pay x maximum LTIP opportunity

Number of Rights awarded =
Face value (Qantas share price) as at 30 June 2021

$2,170,000 x 185%
861,000 Rights awarded =
$4.66

Change of Control In the event of a change of control, the Board determines whether the LTIP Rights vest or otherwise.

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For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

Disclosure In addition to the required statutory disclosures, Qantas chooses to disclose the full value of LTIP awards that vest
during the year in the Remuneration Outcomes Table on page 44. The full value is equal to the number of Rights vested,
multiplied by the Qantas share price at the end of the performance period, even where these shares are subject to an
additional one-year trading restriction.
The statutory remuneration disclosure amortises the accounting value of LTIP awards over the relevant performance
and service period as per the accounting standards. The accounting value for the LTIP awards does not have
regard to whether performance conditions were achieved.

Recovery Retention Plan (RRP)

RRP Overview The RRP involves an upfront award of Rights. If performance and service conditions are achieved over the two-year
performance period, Rights will vest and convert to unrestricted Qantas shares.
If the two-year performance conditions or service conditions are not met, the Rights lapse.

Allocation The number of Rights granted under the RRP is calculated on a face value basis. The number of Rights awarded is
Methodology the maximum number of Rights that may vest and convert to Qantas shares at the end of the performance period.

Performance For Rights to vest under the RRP, all of the following performance conditions must be achieved by the end of the
Conditions performance period on 30 June 2023:
– The Qantas Group meets its $1 billion recovery program target by 30 June 2023
– As at 30 June 2023, Qantas Group’s Net Debt range is below the top end of the Net Debt range as approved
by the Board in accordance with the Group’s Financial Framework
– Qantas Group is profitable on an UPBT basis for 2022/23.

Board The Board retains discretion to:

Discretion
– Adjust the Net Debt range upwards to take into consideration significant initiatives or strategic proposals undertaken
by the Qantas Group that have impacted the ability to deliver the Net Debt target
– Not approve any vested award where there is a material failure in the structure of or compliance with a safety policy
or process that results in death or serious injury, arising out of Qantas Group’s business operations.

Vesting of If performance and service conditions are achieved over the two-year performance period ending 30 June 2023, Rights
RRP Award will vest and convert to unrestricted Qantas shares.

Cessation of In general, when an Executive resigns, is terminated for cause or is terminated in other circumstances involving
Employment unacceptable performance or conduct, any Rights which have not vested will be forfeited.
In limited circumstances, for example, retirement, employer-initiated terminations (with no record of poor performance),
death or total and permanent disablement, Rights will remain on foot on a pro-rata basis and may vest at the end of the
performance period, subject to the satisfaction of the performance and service conditions of the RRP.

Disclosure The statutory remuneration disclosure amortises the accounting value of RRP awards over the relevant performance
and service period as per the accounting standards.
In the year where RRP awards vest, the Remuneration Outcomes disclosure will include the full value of the shares that
vest and convert to shares.

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For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

Other Benefits

Non-Cash Non-Cash Benefits, as disclosed in the remuneration tables, includes other minor benefits.
Benefits

Travel Travel concessions are provided to permanent Qantas employees, consistent with prevailing practice in the airline
industry.
Travel at concessionary prices is on a sub-load basis, that is, it is subject to considerable restrictions and limits
on availability. The policy includes specified direct family members or a nominated travel companion.
In addition, and also consistent with prevailing practice in the airline industry, the CEO and Executive Management and
their eligible beneficiaries are entitled to a number of trips for personal purposes at no cost to the individual.
Post-employment travel concessions are also available to all permanent Qantas employees who qualify by achieving
a service condition. The CEO and Executive Management and their eligible beneficiaries are also entitled to a number of
trips for personal purposes at no cost to the individual after ceasing employment. An estimated present value of these
entitlements accrues over the service period of the individual and is disclosed as a post-employment benefit.

Superannuation Superannuation includes statutory and salary sacrifice superannuation contributions (or superannuation benefits
provided through a defined benefit superannuation plan) and is disclosed as a post-employment benefit.

Other The movement in accrual of annual leave and long service leave is included in Other Long-Term Benefits. The
Long-Term accounting value of Other Long-Term Benefits may be negative, for example, where an Executive’s annual leave balance
Benefits decreases as a result of taking more annual leave than they accrued during the year.

Minimum Shareholding Guidelines

Minimum The following shareholding guidelines were introduced with effect from 1 July 2019:
Shareholding
Individual Guideline
Guidelines
Non-Executive Directors 1 times Base Fee
CEO 1.5 times Base Pay
Executive Management 0.75 times Base Pay

Non-Executive Directors, the CEO and Executive Management have a maximum five-year period from the date of their
appointment to the respective role or commencement of this guideline to accumulate the value of their shareholding.

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For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

6 ANNUAL INCENTIVE SCORECARD OUTCOME 2021/22

Notwithstanding the Board determined that the STIP would not operate in 2021/22, in line with our performance culture a Group STIP
Scorecard of performance measures was still set, with the Board assessing performance against each measure to determine an overall STIP
Scorecard outcome. In the interest of transparency, the table below summarises performance versus target against each scorecard category
under the 2021/22 STIP.
Scorecard
Scorecard Weighting
Category/ Target
Strategic (Range of Actual Component
Objective Measures Outcomes) Outcome Outcome1 Comment
Group Earnings generation: Underlying 30% The Underlying Earnings Before Interest, Tax, Depreciation,
Financial EBITDA (0-45%) Amortisation and Impairments (EBITDA) was below the
Measures threshold as set by the Board due to the impact of
Cash generation: Free Cash Flow
widespread domestic lockdowns primarily in the first half
of 2021/22.
The Free Cash Flow of $2,430 million for 2021/22 was
ahead of the target set by the Board.
Overall, there was a partial contribution under this
measure to the STIP Scorecard.
Recovery Restructuring benefits 20% Recovery Plan initiatives have delivered $923 million
Plan and Qantas Loyalty (0-30%) of structural cost benefits.
Growth Qantas Loyalty exceeded its Earnings Before Interest
Underlying EBIT
and Tax (EBIT) target for 2021/22.
This scorecard category achieved an above target outcome
and therefore a full contribution to the STIP Scorecard.
Customer Net Promoter Score (NPS) — for 15% Customer satisfaction for all key domestic airlines and
domestic airlines and Qantas (0-22.5%) Qantas Frequent Flyer was below threshold as a result
Frequent Flyer of the recent operational challenges.
Punctuality The Qantas Domestic and QantasLink combined on-time
performance result was also below threshold.
External Reputation/Trust
While our Reputation/Trust target was exceeded - which
would have resulted in a partial contribution to the STIP
Scorecard under this measure - in acknowledgement that
our broader customer performance did not meet
expectations in 2021/22 the Board exercised discretion to
record no achievement against Customer and hence no
contribution to the STIP Scorecard.
Leading Corporate share — Qantas Group 20% Qantas Group’s revenue share of the domestic corporate
Domestic (0-30%) travel market and Qantas Airlines’ revenue share of the
Small and Medium-sized Enterprise
Market SME domestic travel market targets were exceeded.
(SME) share — Qantas Airlines
Position Jetstar achieved its Australian domestic market capacity
Jetstar capacity share
share target.
Overall, there was an above target contribution to the STIP
Scorecard under the Leading Domestic Market Position.
Workplace Workplace Safety measures 15% Workplace safety targets overall were achieved.
and (0-22.5%) Operational safety performance continued to remain
Operational strong.
Safety ‘Work Well’/‘Fly Well’ program performance for the
Board’s assessment of Operational year was good.
Safety and ‘Work Well’/‘Fly Well’ Overall, there was an above target contribution to the STIP
Programs Scorecard under the Workplace and Operational Safety
measure.
2021/22 STIP Scorecard Outcome 100% 90%
(0-150%) out of a maximum 150%

Target achieved Partial achievement No achievement against targets

KEY:
or exceeded against targets
1 Component outcome shown where overall target is partially achieved.

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For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

Additional Descriptions of 2021/22 STIP Scorecard Measures

Group Financial As in 2020/21, cash flow continued to be critical to our business in 2021/22. With this in mind, Free Cash Flow was
Measures selected as a key financial performance measure. To complement this, Underlying Earnings Before Interest, Tax,
Depreciation and Amortisation (EBITDA) was introduced as a Group Financial Measure for 2021/22. EBITDA is
a key external and internal measure that reflects the Group’s focus on operational earnings performance.

Recovery Plan The post-COVID Three-Year Recovery Plan, including delivering on rightsizing and restructuring initiatives, continued to
and Growth be a strategic priority during 2021/22. To maintain focus on the post-COVID Recovery Plan, a restructuring benefit
target was included as a performance measure.
To maintain the long term strategic focus of growing diversified earnings, a STIP target was also set to grow
Qantas Loyalty Underlying EBIT.

Customer Customer service is measured against NPS targets.

This is a survey-based measure of how strongly our customers promote the services of our businesses. Individual NPS
targets are set for Qantas Domestic, QantasLink, Qantas Frequent Flyer and Jetstar Australia Domestic.
Maintaining our reputation during a period of significant transformation and uncertain flying arising from multiple
border closures was a key area of focus. Reputation/Trust is a survey-based measure of how trusted Qantas is as
a brand in the community.
On-time departures for Qantas Domestic and QantasLink continue to be important to our business performance and is
therefore included as a STIP measure. As agreed with and reported to the Bureau of Infrastructure, Transport and
Regional Economics (BITRE), punctuality is measured as the number of flights operating on-time (on an on-time
departure basis) as a percentage of the total number of flights operated.

Leading Domestic To support the strategic initiatives of maximising our domestic position through the dual brand strategy, STIP targets
Market Recovery were set in relation to our Australian domestic share of the corporate and small- and medium-sized enterprise (SME)
travel markets and Jetstar domestic capacity share.

Workplace and As safety is always our first priority, the STIP Scorecard includes an assessment of both Workplace and Operational
Operational safety. In addition, the Board retains an overriding discretion to scale down the STIP outcome (or reduce it to zero) in
Safety the event of a material aviation safety incident or in the event where safety outcomes do not meet our expectations.
The exercise of that discretion considers the specific circumstances of the incident and/or safety outcomes, and is
informed by a recommendation of the Safety, Health, Environment and Security Committee. In 2016/17, for example,
the Board exercised its discretion in relation to the Workplace Safety outcome in that year to both zero the STIP
scorecard in that respect and by additionally reducing the overall STIP award to the CEO, Executive Management, and
other direct reports to the CEO by a significant proportion.
Of course, this “safety override” discretion is in addition to, and does not qualify, the Board’s overall discretion over
STIP awards.
The Safety, Health, Environment and Security Committee performs an assessment of both Workplace Safety
performance and Operational Safety performance.
The objective of the Workplace Safety targets is to reduce employee injuries. Targets were therefore set across:
– Total Recordable Injury Frequency Rate
– Lost Work Case Frequency Rate
– Short Term Impairment Injury Frequency Rate
– Long Term Impairment Injury Frequency Rate.
Operational Safety performance is assessed against outcome-based measures (including operational occurrences
that pose a significant threat to the safety of employees and customers) and risk-based lead indicators commonly
associated with aviation industry accidents, such as flight data trends, technical dispatch reliability and reporting rates.
‘Work Well’/‘Fly Well’ programs are assessed against outcomes associated with minimising our customers’ and
employees’ exposure to COVID-19. This includes implementation and effectiveness of controls to prevent clusters both
on-board and in the workplace, and customer satisfaction with the Group’s response to the pandemic.

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For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

7 LONG TERM INCENTIVE OUTCOME 2020-2022

Qantas TSR Performance1 Qantas TSR Rank vs. Qantas TSR Rank vs. ASX100 Vesting of 2020-2022 LTIP
Global Airlines

(3%) 2nd 60th 50%

The three-year performance measures under the 2020-2022 LTIP are Qantas’ TSR compared to:
– A global airline peer group
– ASX100 companies.
Qantas continued to outperform the majority of companies in the global airline peer group, with top quartile relative TSR performance versus
airline peer group companies achieved for the seventh straight rolling three-year period.
However, Qantas and the aviation industry continued to be adversely impacted by COVID-19 relative to other ASX100 companies and therefore
Qantas’ TSR performance versus other ASX100 companies was below median.
Based on this performance, 50 per cent vesting was achieved.
Qantas’ Three-Year TSR Performance1 vs Peer Groups (%)

1 TSR performance, applying the LTIP performance test methodology (which uses the average closing share price over the six months preceding the test date of 30 June 2022).

8 SUMMARY OF KEY CONTRACT TERMS AS AT 30 JUNE 2022

Contract Details Alan Joyce3 Andrew David4 Gareth Evans4 Vanessa Hudson4 Olivia Wirth4
Base Pay $2,170,000 $1,020,000 $1,081,000 $1,020,000 $867,000
Pay Mix per contract:
– STIP Target1 100% 80% 80% 80% 80%
– LTIP Target1,2 185% 95% 95% 95% 95%
An annual benefit of trips for these Executives and eligible beneficiaries during employment,5 at no cost
to the individual, is as follows:
4 long-haul 2 long-haul 2 long-haul 2 long-haul 2 long-haul
12 short-haul 6 short-haul 6 short-haul 6 short-haul 6 short-haul
The same benefit is provided for use post-employment, based on the period of service in an Executive
Management role within the Qantas Group.
Notice Employment may be terminated by either the Executive or Qantas by providing six months’ written
notice.6 Each Executive’s contract includes a provision that limits any termination payment to the
statutory limit prescribed under the Corporations Act 2001 (Cth).
Severance A severance payment of six months’ Base Pay applies where termination is initiated by Qantas.6
The Board determined that STIP will not operate in 2021/22. This was replaced by the RRP, with details of the Rights granted to Executive
Management set out on page 59.
1 Opportunity expressed as a percentage of Base Pay.
2 Rights awarded on a face value basis and is the maximum number of Rights that may vest and convert to Qantas Shares.
3 Target Remuneration Mix for the CEO for 2021/22 was Base Pay 35%, STIP 0% and LTIP (on a face value basis) 65%. Shareholder approval will be sought at the 2022 AGM for the
CEO’s participation in the RRP and for the CEO’s grant of Rights under the plan, with details of the calculation provided in the Notice of Meeting.
4 Target Remuneration Mix for Executive Management for 2021/22 was Base Pay 32%, STIP 0%, RRP 38% and LTIP (on a face value basis) 30%.
5 These benefits are not cumulative and lapse if they are not used during the calendar year in which the entitlements arise.
6 Other than for misconduct or unsatisfactory performance.

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For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

9 QANTAS FINANCIAL PERFORMANCE HISTORY

To provide further context on Qantas’ performance, the following graphs outline a five-year history of key financial metrics:
Return on Invested Capital (ROIC%) Underlying Profit Before Tax1 ($M) Operating Cash Flow ($M)

1 Underlying Profit Before Tax (Underlying PBT) is the primary reporting measure used by the Qantas Group’s Chief Operating Decision-Making bodies, being the Chief Executive
Officer, Group Management Committee and the Board of Directors, for the purpose of assessing the performance of the Group. Statutory (Loss)/Profit After Tax for 2021/22
was ($860) million (2021: ($1,692) million; 2020: ($1,964) million; 2019: $840 million; and 2018: $953 million). Return on Invested Capital (ROIC%) and UPBT for the 2020/21
financial year has been restated for the adoption of the IFRIC agenda decision in relation to cloud computing. The 2017/18, 2018/19, 2019/20 financial years have not been restated.

Qantas’ Five-Year TSR Performance

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For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

10 EQUITY INSTRUMENTS
The following tables set out the holdings of equity instruments granted as remuneration.
Shares Awarded Under the Short Term Incentive Plan
The following table details shares awarded under the STIP that are subject to a deferral period:
Number of Shares
Vested and
Short Term Incentive Plan 1 July Granted Transferred Forfeited 30 June
Alan Joyce 2022 97,768 - (97,768) - -
2021 251,886 - (154,118) - 97,768
Andrew David 2022 33,088 - (33,088) - -
2021 83,168 - (50,080) - 33,088
Gareth Evans 2022 38,963 - (38,963) - -
2021 97,669 - (58,706) - 38,963
Vanessa Hudson 2022 26,585 - (26,585) - -
2021 52,894 - (26,309) - 26,585
Olivia Wirth 2022 31,250 - (31,250) - -
2021 74,307 - (43,057) - 31,250

Rights Awarded Under the Long Term Incentive Plan

The following table details Rights awarded under the LTIP that are subject to performance hurdles that are yet to be tested, and tested Rights
that have not yet converted into shares.
Number of Rights
Vested and Lapsed/
Long Term Incentive Plan 1 July Granted1,2 Transferred3 Forfeited 30 June4
Alan Joyce 5,6
2022 3,430,000 861,000 - - 4,291,000
2021 2,081,000 1,349,000 - - 3,430,000
Andrew David 2022 701,500 208,000 (78,750) (78,750) 752,000
2021 503,000 364,500 (83,000) (83,000) 701,500
Gareth Evans 2022 742,500 220,500 (83,250) (83,250) 796,500
2021 532,500 386,000 (88,000) (88,000) 742,500
Vanessa Hudson 2022 576,000 208,000 (31,000) (31,000) 722,000
2021 246,500 364,500 (17,500) (17,500) 576,000
Olivia Wirth 2022 595,500 176,500 (66,750) (66,750) 638,500
2021 360,500 309,500 (37,250) (37,250) 595,500
1 Rights under the 2022-2024 LTIP were granted on 5 November 2021 to Mr Joyce (following approval by shareholders at the 2021 AGM) and 17 September 2021 for other Executives
and will be tested against the performance hurdles as at 30 June 2024. The number of Rights granted was determined using the face value of a Right on 30 June 2021 of $4.66,
being the start of the performance period. The fair value of a Right on the grant date was $3.85 for Mr Joyce and $3.895 per Right for other Executives.
2 Rights under the 2021-2023 LTIP were granted on 23 October 2020 to Mr Joyce (following approval by shareholders at the 2020 AGM) and 11 September 2020 for other Executives
and will be tested against the performance hurdles as at 30 June 2023. The number of Rights granted was determined using the face value of a Right on 30 June 2020 of $3.78,
being the start of the performance period. The fair value of a Right on the grant date was $3.07 for Mr Joyce and $2.235 per Right for other Executives.
3 50 per cent of Rights under the 2019-2021 LTIP (granted on 5 September 2018 for other Executives) vested following the testing of performance hurdles as at 30 June 2021 and the
Board’s approval of the 2019-2021 LTIP vesting outcome on 25 August 2021, with the remaining Rights lapsing.
4 Rights under the 2020-2022 LTIP (granted on 25 October 2019 to Mr Joyce and 4 October 2019 for other Executives) are included in the 30 June 2022 balance. The number of Rights
granted was determined using the face value of a Right on 30 June 2019 of $5.40, being the start of the performance period. The fair value of a Right on the grant date was $3.59 for
Mr Joyce and $4.06 per Right for other Executives. For Executive Management, 50 per cent of these Rights vested following the testing of performance hurdles as at 30 June 2022
and the Board’s approval of the 2020-2022 LTIP vesting outcome on 24 August 2022, with the remaining Rights lapsing. The shares awarded to Executive Management upon vesting
of the LTIP remain subject to an additional one-year trading restriction. The CEO offered, and the Board agreed, to defer the decision until at least August 2023 as to whether his
Rights will be forfeited or allowed to convert to shares.
5 Rights under the 2018-2020 LTIP (granted on 27 October 2017 to Mr Joyce) are included in the 30 June 2022 balance. The number of Rights granted was determined using the face
value of a Right on 30 June 2017 of $5.72, being the start of the performance period. The fair value of a Right on the grant date was $3.30 for Mr Joyce. 50 per cent vesting
was achieved following the testing of performance hurdles as at 30 June 2020. Notwithstanding that the LTIP conditions were partially achieved, the CEO offered, and the
Board agreed, to defer the decision as to whether his Rights will be forfeited or allowed to convert to shares until August 2023.
6 Rights under the 2019-2021 LTIP (granted on 26 October 2018 to Mr Joyce) are included in the 30 June 2022 balance. The number of Rights granted was determined using the face
value of a Right on 30 June 2018 of $6.16, being the start of the performance period. The fair value of a Right on the grant date was $2.33 for Mr Joyce. 50 per cent vesting
was achieved following the testing of performance hurdles as at 30 June 2021. Notwithstanding that the LTIP conditions were partially achieved, the CEO offered, and the
Board agreed, to defer the decision as to whether his Rights will be forfeited or allowed to convert to shares until August 2023.

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 QANTAS AN N UAL R EP OR T 2 02 2

Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

Rights Awarded Under the Recovery Retention Plan

The following table details Rights awarded under the RRP that are subject to performance hurdles that are yet to be tested.
Number of Rights
Vested and Lapsed/
Recovery Retention Plan 1 July Granted1 Transferred Forfeited 30 June
Alan Joyce 2022 - - - - -
2021 - - - - -
Andrew David 2022 - 262,500 - - 262,500
2021 - - - - -
Gareth Evans 2022 - 278,500 - - 278,500
2021 - - - - -
Vanessa Hudson 2022 - 262,500 - - 262,500
2021 - - - - -
Olivia Wirth 2022 - 223,500 - - 223,500
2021 - - - - -
1 Rights under the 2022-2023 RRP were granted on 9 June 2022 for other Executives and will be tested against the performance hurdles as at 30 June 2023. The number of Rights
granted was determined using the face value of a Right on 30 June 2021 of $4.66, being the Qantas share price at the start of the performance period. The fair value of a Right was
$4.98 per Right for other Executives. Shareholder approval will be sought for the award of Rights to the CEO under the 2022-2023 RRP at the 2022 AGM.

Equity Holdings and Transactions

Executive Management or their related parties directly, indirectly or beneficially held shares in the Qantas Group as detailed in the table below.
It also shows each individual’s shareholding and corresponding progress against their Minimum Shareholding Guideline at 30 June 2022.
Progress against
Interest in Rights Interest in Value of Minimum
Key Management Shares Awarded as Converted Other Shares Shares2 Shareholding
Personnel — Executives 1 July 2021 Remuneration to Shares Changes1 30 June 2022 $’000 Guideline3
Alan Joyce 2,990,243 - - - 2,990,243 13,366 Meets
Andrew David 166,168 - 78,750 - 244,918 1,095 Meets
Gareth Evans 634,604 - 83,250 - 717,854 3,209 Meets
Vanessa Hudson 85,501 - 31,000 - 116,501 521 On track
Olivia Wirth 31,250 - 66,750 (98,000) - - NA4
1 Other Changes include shares purchased, sold, forfeited, and on cessation as a KMP.
2 The interest in shares at 30 June 2022 multiplied by the Qantas share price of $4.47 at 30 June 2022.
3 The CEO and Executive Management have a maximum five-year period from the later of the date of their appointment to the respective role or 1 July 2019 to accumulate the value of
their shareholding.
4 Ms Wirth is currently unable to comply with the Minimum Shareholding Guideline as her spouse is a Partner at an accounting firm that prohibits the individual (or their immediate
family member) owning a financial interest in assurance and audit clients.

Other than share-based payment compensation, all equity instrument transactions between the Executive Management (including
their related parties) and Qantas during the year have been on an arm’s length basis.
Performance Remuneration Affecting Future Periods
The fair value of share-based payments granted is amortised over the service period, therefore, remuneration in respect of these awards may
be reported in future years. The following table summarises the maximum value of the awards that will be reported in the statutory
remuneration tables in future years, assuming all performance conditions are met. The minimum value of these awards is nil should
performance conditions not be satisfied.
Future Expense by Plan Future Expense by Financial Year
RRP Awards LTIP Awards
2022/23 2020-2022 2021-2023 2022-2024 Total 2023 2024 2025 Total
Executives $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000
Alan Joyce1 - 157 1,705 2,535 4,397 2,788 1,414 195 4,397
Andrew David 1,017 38 300 555 1,910 1,423 444 43 1,910
Gareth Evans 1,079 41 318 587 2,025 1,509 471 45 2,025
Vanessa Hudson 1,017 32 300 554 1,903 1,416 444 43 1,903
Olivia Wirth 866 33 255 469 1,623 1,210 377 36 1,623
1 Shareholder approval will be sought at the 2022 Annual General Meeting for the CEO’s RRP award.

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QANTAS AN N UAL R EP OR T 2 02 2

Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

11 NON-EXECUTIVE DIRECTOR FEES

Non-Executive Director fees are determined within an aggregate Non-Executive Directors’ fee pool limit. An annual total fee pool of $3 million
(excluding industry standard travel entitlements received) was approved by shareholders at the 2016 AGM. Total Non-Executive Directors’
remuneration (excluding industry standard travel entitlements received and other non-cash benefits) for the year ended 30 June 2022 was
$2.24 million (2021: $2.25 million), which is within the approved annual fee pool. Non-Executive Directors’ remuneration reflects the
responsibilities of Non-Executive Directors. Fees are benchmarked against Non-Executive Director fees of ASX50 companies and revenue-
based peer groups.
Consistent with the Group-wide wage freeze, Non-Executive Director fees remained unchanged in 2021/22. Non-Executive Directors
remuneration for 2021/22 is higher than in prior years, as Non-Executive Directors returned to receiving contracted Board Fees after
voluntarily reduced pay for seven months during the last two financial years.
Board Committees1
Chair 2
Member Chair Member
Board Fees $610,000 $158,000 $63,500 $31,750
1 The committees are the Audit Committee, Remuneration Committee, Nominations Committee and Safety, Health, Environment and Security Committee.
2 The Chairman does not receive any additional fees for serving on or chairing any Board committee.

Non-Executive Directors do not receive any performance-related remuneration. Overseas-based Non-Executive Directors are paid a travel
allowance when travelling on international journeys of greater than six hours to attend Board and committee meetings or Board-related
activities requiring the participation of all Directors.
A Non-Executive Director Fee Sacrifice Share Acquisition Plan is offered to Non-Executive Directors whereby the Non-Executive Director can
elect to sacrifice a percentage of their Board or Board and committee fees in return for a grant of Rights to the equivalent value of the same
number of Qantas ordinary shares. Each Right granted will convert automatically to one fully-paid Qantas ordinary share at the conversion
date, which is six months from the grant date, subject to remaining as a Non-Executive Director on the conversion date. The plan is designed
to provide Non-Executive Directors the opportunity to build their shareholding in a tax effective manner and to further align their interests
with the interests of shareholders. Fees elected to be sacrificed in return for a grant of Rights continue to be reported as Base Pay in the
remuneration disclosures.
All Non-Executive Directors and eligible beneficiaries receive travel entitlements. The Chair and eligible beneficiaries are each entitled to four
long-haul trips and 12 short-haul trips each calendar year and all other Non-Executive Directors and eligible beneficiaries are each entitled to
three long-haul trips and nine short-haul trips each calendar year. These flights are not cumulative and lapse if they are not used during the
calendar year in which the entitlement arises.
Post-employment, the Chair and eligible beneficiaries are each entitled to two long-haul trips and six short-haul trips for each year of service,
and all other Non-Executive Directors and eligible beneficiaries are each entitled to one long-haul trip and three short-haul trips for each year
of service. The accounting value of the travel benefit is captured in the remuneration table (as a non-cash benefit for travel during the year and as
a post-employment benefit).

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 QANTAS AN N UAL R EP OR T 2 02 2

Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

Remuneration for 2021/22 — Non-Executive Directors

Short-Term Employee Benefits Post-Employment Benefits
Base Pay1 Non-Cash
$’000 (Cash) Benefits Sub-Total Superannuation Travel Sub-Total Total

Richard Goyder 2022 586 27 613 24 21 45 658

Chair 2021 486 25 511 20 29 49 560
Maxine Brenner 2022 201 49 250 20 10 30 280
Non-Executive Director 2021 192 8 200 18 11 29 229
Jacqueline Hey 2022 233 2 235 18 10 28 263
Non-Executive Director 2021 167 - 167 13 11 24 191
Belinda Hutchinson 2022 246 15 261 17 10 27 288
Non-Executive Director 2021 197 3 200 14 11 25 225
Michael L'Estrange 2022 201 16 217 20 10 30 247
Non-Executive Director 2021 192 - 192 18 11 29 221
Paul Rayner 2 2022 82 - 82 8 10 18 100
Non-Executive Director 2021 223 5 228 18 11 29 257
up to 5 November 2021

Todd Sampson 2022 194 20 214 16 10 26 240

Non-Executive Director 2021 167 4 171 13 11 24 195
Antony Tyler3 2022 273 1 274 - 10 10 284
Non-Executive Director 2021 241 - 241 - 11 11 252
Barbara Ward2 2022 92 - 92 8 10 18 110
Non-Executive Director 2021 249 - 249 22 11 33 282
up to 5 November 2021

Total 2022 2,108 130 2,238 131 101 232 2,470

2021 2,114 45 2,159 136 117 253 2,412
1 Base Pay includes any amounts that the Non-Executive Director elects to salary sacrifice in return for a grant of Rights under the Non-Executive Director Fee Sacrifice Share
Acquisition Plan.
2 Mr Rayner and Ms Ward retired as Directors on 5 November 2021.
3 Mr Tyler received a travel allowance of $20,000 during 2021/22 (2021: nil). This amount is included in Base Pay (Cash).

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 QANTAS AN N UAL R EP OR T 2 02 2

Directors’ Report continued

For the year ended 30 June 2022
REMUNERATION REPORT (AUDITED) (CONTINUED)

Equity Holdings and Transactions

Non-Executive Director KMP or their related parties directly, indirectly or beneficially held shares in the Qantas Group as detailed in the table
below. It also shows each individual’s shareholding and corresponding progress against their Minimum Shareholding Guideline at 30 June
2022.
Conversion of Progress against
Interest in Rights to Interest in Value of Minimum
Key Management Personnel — Shares as at Ordinary Other Ceased as Shares as at Shares3 Shareholding
Non-Executive Directors 30 June 2021 Shares1 Changes2 Director 30 June 2022 $’000 Guideline 4
Richard Goyder 139,433 36,170 - - 175,603 785 Meets
Maxine Brenner 39,498 - - - 39,498 177 Meets
Jacqueline Hey 47,603 14,128 - - 61,731 276 Meets
Belinda Hutchinson 34,065 13,134 - - 47,199 211 Meets
Michael L’Estrange 29,445 - 4,500 - 33,945 152 On track
Paul Rayner5 305,362 6,336 - (311,698) NA - -
Todd Sampson 27,538 6,245 - - 33,783 151 On track
Antony Tyler 52,000 - - - 52,000 232 Meets
Barbara Ward 5 54,127 - - (54,127) NA - -
1 Ordinary Shares issued upon conversion of Rights acquired under the Non-Executive Director Fee Sacrifice Share Acquisition Plan.
2 Other Changes includes shares purchased and sold.
3 The interest in shares at 30 June 2022 multiplied by the Qantas share price of $4.47 at 30 June 2022.
4 Non-Executive Directors have a maximum five-year period from the later of date of their appointment to the respective role or 1 July 2019 to accumulate the value
of their shareholding.
5 Mr Rayner and Ms Ward retired as Directors on 5 November 2021.

Rights Acquired Under the Non-Executive Director Fee Sacrifice Share Acquisition Plan
The following table details Rights acquired under the Non-Executive Director Fee Sacrifice Share Acquisition Plan by Non-Executive Director
KMP or their related parties:
Interest in Interest in
Rights as at Acquired by Fee Converted to Rights as at
Key Management Personnel — Non-Executive Directors 30 June 2021 Sacrifice1 Ordinary Shares2 30 June 2022
Richard Goyder 18,347 35,757 (36,170) 17,934
Maxine Brenner - - - -
Jacqueline Hey 9,512 7,712 (14,128) 3,096
Belinda Hutchinson 6,662 14,851 (13,134) 8,379
Michael L’Estrange - - - -
Paul Rayner 3 6,336 - (6,336) -
Todd Sampson 3,168 6,173 (6,245) 3,096
Antony Tyler - - - -
Barbara Ward 3 - - - -
1 Number of Rights acquired under the Non-Executive Director Fee Sacrifice Share Acquisition Plan. Rights were acquired on 3 September 2021 applying a fair value of $ 5.1336 per
Right. Rights were acquired on 4 March 2022 applying a fair value of $ 5.1019. The Rights acquired 4 March 2022 remained outstanding at 30 June 2022 and converted to restricted
Ordinary shares on 26 August 2022.
2 Rights acquired on 5 March 2021 (fair value of $ 4.9871 per Right) converted to restricted Ordinary shares on 27 August 2021 and Rights acquired on 3 September 2021 (fair value of
$5.1336 per Right) converted to restricted Ordinary Shares on 28 February 2022.
3 Mr Rayner and Ms Ward retired as Directors on 5 November 2021.

All equity instrument transactions between the Non-Executive Director KMP, including their related parties, and Qantas during the year have
been on an arm’s length basis.
Loans and Other Transactions with Key Management Personnel
No KMP or their related parties held any loans from the Qantas Group during or at the end of the year ended 30 June 2022 or prior year.
A number of KMPs and their related parties have transactions with the Qantas Group. All transactions are conducted on normal commercial
arm’s length terms.

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QANTAS ANNUAL REPORT 2022

Directors’ Report continued

For the year ended 30 June 2022

ENVIRONMENTAL OBLIGATIONS
The Qantas Group’s operations are subject to a range of Commonwealth, State, Territory and international environmental legislation. The
Qantas Group is committed to environmental sustainability with high standards for environmental performance. The Board places particular
focus on the environmental aspects of its operations through the Safety, Health, Environment and Security Committee, which is responsible
for monitoring compliance with these regulations and reporting to the Board.
The Directors are satisfied that the Qantas Group Management System Standard underpins the management of the Qantas Group’s
environmental exposures and environmental performance, including compliance obligations. The Directors are also satisfied that appropriate
monitoring procedures are in place to ensure compliance with the Group Management System Standard. Any significant environmental
incidents are reported to the Board through the Safety, Health, Environment and Security Committee.
INDEMNITIES AND INSURANCE
Under the Qantas Constitution, Qantas indemnifies, to the extent permitted by law, each Director and Company Secretary of Qantas against
any liability incurred by that person as an officer of Qantas.
The Directors and the Company Secretaries listed on pages 30 to 31 and individuals who formerly held any of these positions have the benefit
of the indemnity in the Qantas Constitution. Members of Qantas’ Executive Management team and certain former members of the Executive
Management team have the benefit of an indemnity to the fullest extent permitted by law and as approved by the Board. In respect of non-
audit services, KPMG, Qantas’ auditor, has the benefit of an indemnity to the extent KPMG reasonably relies on any information provided by
Qantas which is false, misleading or incomplete. No amount has been paid under any of these indemnities during 2021/22 or to the date of
this Report.
Qantas has insured against amounts which it may be liable to pay on behalf of Directors and Officers or which it otherwise agrees to pay by
way of indemnity.
During the year, Qantas paid a premium for Directors’ and Officers’ liability insurance policies, which cover all Directors and Officers of the
Qantas Group. Details of the nature of the liabilities covered, and the amount of the premiums paid in respect of the Directors’ and Officers’
insurance policies, are not disclosed, as disclosure is prohibited under the terms of the contracts.
NON-AUDIT SERVICES
During the year, Qantas’ auditor, KPMG, performed certain other services in addition to its statutory duties. The Directors are satisfied that:
a. The non-audit services provided during 2021/22 by KPMG as the external auditor were compatible with the general standard of
independence for auditors imposed by the Corporations Act 2001 (Cth)
b. Any non-audit services provided during 2021/22 by KPMG as the external auditor did not compromise the auditor independence
requirements of the Corporations Act 2001 (Cth) for the following reasons:
–. KPMG services have not involved partners or staff acting in a managerial or decision-making capacity within the Qantas Group or being
involved in the processing or originating of transactions
– KPMG non-audit services have only been provided where Qantas is satisfied that the related function or process will not have a material
bearing on the audit procedures
– KPMG partners and staff involved in the provision of non-audit services have not participated in associated approval or authorisation
processes
– A description of all non-audit services undertaken by KPMG and the related fees has been reported to the Board to ensure complete
transparency in relation to the services provided
– The declaration required by section 307C of the Corporations Act 2001 (Cth) confirming independence has been received from KPMG.
A copy of the lead auditor’s independence declaration as required under section 307C of the Corporations Act 2001 (Cth) is included on
page 64.
Details of the amounts paid to KPMG for audit and non-audit services provided during the year are set out in Note 28 to the Financial
Statements.

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QANTAS ANNUAL REPORT 2022

Directors’ Report continued

For the year ended 30 June 2022

LEAD AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE CORPORATIONS ACT 2001
To: The Directors of Qantas Airways Limited
I declare that, to the best of my knowledge and belief, in relation to the audit for the financial year ended 30 June 2022, there
have been:
i. no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit,
and
ii. no contraventions of any applicable code of professional conduct in relation to the audit.

KPMG Julian McPherson

Sydney Partner
9 September 2022

KPMG, an Australian partnership and a member firm of the KPMG Limited liability by a scheme approved
global organization of independent member firms affiliated with under Professional Standards Legislation
KPMG International Limited, a private English company limited by
guarantee. All rights reserved.
The KPMG name and logo are trademarks used under license by
the independent member firms of the KPMG global organization.

Rounding
Qantas is a company of a kind referred to in Australian Securities and Investments Commission (ASIC) Corporations (Rounding in Financial/
Directors’ Reports) Instrument 2016/191 and in accordance with that Instrument, amounts in this Directors’ Report and the Financial Report
have been rounded to the nearest million dollars unless otherwise stated.
Signed pursuant to a Resolution of the Directors:

Richard Goyder Alan Joyce

Chairman Chief Executive Officer
9 September 2022 9 September 2022

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QANTAS ANNUAL REPORT 2022

Financial Report
For the year ended 30 June 2022

FINANCIAL STATEMENTS
Consolidated Income Statement 66
Consolidated Statement of Comprehensive Income 67
Consolidated Balance Sheet 68
Consolidated Statement of Changes in Equity 69
Consolidated Cash Flow Statement 71

NOTES TO THE FINANCIAL STATEMENTS

1 Statement of Compliance and Basis of Preparation 72
2 Operating Segments, Underlying Profit Before Tax and Return on Invested Capital 75
3 Earnings Per Share 80
4 Revenue and Other Income 80
5 Depreciation and Amortisation 80
6 Net Gain on Disposal of Assets 81
7 Other Expenditure 81
8 Net Finance Costs 81
9 Income Tax Benefit 82
10 Dividends and Other Shareholder Distributions 83
11 Receivables 84
12 Inventories 84
13 Assets Classified as Held for Sale 84
14 Investments Accounted for Under the Equity Method 85
15 Property, Plant and Equipment 86
16 Leases 87
17 Intangible Assets 88
18 Deferred Tax Assets 89
19 Other Assets 90
20 Revenue Received in Advance 91
21 Net on Balance Sheet Debt 91
22 Provisions 92
23 Capital 93
24 Government Grants and Assistance 94
25 Impairment of Assets and Related Costs 95
26 Share-Based Payments 99
27 Financial Risk Management 101
28 Auditor’s Remuneration 107
29 Notes to the Consolidated Cash Flow Statement 107
30 Superannuation 108
31 Deed of Cross Guarantee 110
32 Related Parties 112
33 Parent Entity Disclosures – Qantas Airways Limited 113
34 Contingent Liabilities 115
35 Acquisition of Subsidiary 116
36 Post-Balance Sheet Date Events 116
37 Material Business Risks 117
38 Summary of Significant Accounting Policies 120
39 New Standards and Interpretations Adopted by the Group 134
40 New Standards and Interpretations Not Yet Adopted by the Group 139

Directors’ Declaration 140

Independent Auditor’s Report 141

65
 QANTAS ANNUAL REPORT 2022

Consolidated Income Statement

For the year ended 30 June 2022

2022 2021
(restated)1
Notes $M $M
REVENUE AND OTHER INCOME
Net passenger revenue 5,951 3,766
Net freight revenue 1,963 1,316
Other revenue and income 4(B) 1,194 852
Revenue and other income 9,108 5,934

EXPENDITURE
Manpower and staff-related 3,024 1,970
Aircraft operating variable 2,328 1,555
Fuel 1,848 835
Depreciation and amortisation 5 1,801 1,877
Share of net loss of investments accounted for under the equity method 14 126 129
Impairment of assets and related costs 25 35 270
De-designation and ineffectiveness of fuel and foreign exchange hedges 27(C) (22) (33)
Redundancies and related costs 5 297
Net gain on disposal of assets 6 (692) (26)
Other 7 1,545 1,058
Expenditure 9,998 7,932
Statutory loss before income tax expense and net finance costs (890) (1,998)
Finance income 8 17 20
Finance costs 8 (318) (321)
Net finance costs 8 (301) (301)
Statutory loss before income tax expense (1,191) (2,299)
Income tax benefit 9 331 607
Statutory loss for the year (860) (1,692)

Attributable to:
Members of Qantas (860) (1,692)
Non-controlling interests — —
Statutory loss for the year (860) (1,692)

EARNINGS PER SHARE ATTRIBUTABLE TO MEMBERS OF QANTAS

Basic statutory Loss Per Share (cents) 3 (45.6) (89.9)
Diluted statutory Loss Per Share (cents) 3 (45.6) (89.9)

The above Consolidated Income Statement should be read in conjunction with the accompanying notes.

1
The Group adopted the IFRIC agenda decision in relation to Cloud Computing (“IFRIC Cloud Computing decision”) retrospectively. The comparative period presented has been restated
accordingly. Refer to Note 39 for further information.

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 QANTAS ANNUAL REPORT 2022

Consolidated Statement of Comprehensive Income

For the year ended 30 June 2022

2021
2022 (restated)1
$M $M

Statutory loss for the year (860) (1,692)

Items that are or may be subsequently reclassified to profit or loss
Effective portion of changes in fair value of cash flow hedges, net of tax 492 201
Transfer of effective hedging (gains)/losses from hedge reserve to the Consolidated Income Statement, net
(274) 49
of tax2
De-designation of fuel and foreign exchange hedges to the Consolidated Income Statement, net of tax (20) 15
Recognition of effective cash flow hedges on capitalised assets, net of tax 3 4
Net changes in hedge reserve for time value of options, net of tax 20 42
Foreign currency translation of controlled entities (18) 10
Foreign currency translation of investments accounted for under the equity method 7 12
Share of other comprehensive (loss)/income of investments accounted for under the equity method (3) 12
Items that will not subsequently be reclassified to profit or loss
Defined benefit actuarial gains, net of tax 203 251
Fair value (losses)/gains on investments, net of tax (22) 29
Other comprehensive income for the year 388 625
Total comprehensive loss for the year (472) (1,067)

Attributable to:
Members of Qantas (472) (1,067)
Non-controlling interests — —
Total comprehensive loss for the year (472) (1,067)

The above Consolidated Statement of Comprehensive Income should be read in conjunction with the accompanying notes.

1
The Group adopted the IFRIC agenda decision in relation to Cloud Computing (“IFRIC Cloud Computing decision”) retrospectively. The comparative period presented has been restated
accordingly. Refer to Note 39 for further information.
2
These amounts were allocated to revenue of ($19) million (2021: nil), fuel expenditure of ($372) million (2021: $67 million), foreign exchange gains of nil (2021: $3 million) and income
tax expense of $117 million (2021: ($21) million) in the Consolidated Income Statement.

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 QANTAS ANNUAL REPORT 2022

Consolidated Balance Sheet

As at 30 June 2022

2022 2021
(restated)1
Notes $M $M
CURRENT ASSETS
Cash and cash equivalents 21(A) 3,343 2,221
Receivables 11 1,102 579
Lease receivables 16(B) 9 5
Other financial assets 27(B), (C) 641 176
Inventories 12 269 279
Assets classified as held for sale 13 1 1
Other 19 268 169
Total current assets 5,633 3,430
NON-CURRENT ASSETS
Receivables 11 5 54
Lease receivables 16(B) 45 47
Other financial assets 27(B), (C) 199 185
Investments accounted for under the equity method 14 57 57
Property, plant and equipment 15 10,224 10,787
Right of use assets 16(A) 957 1,109
Intangible assets 17 778 745
Deferred tax assets 18 853 706
Other 19 902 687
Total non-current assets 14,020 14,377
Total assets 19,653 17,807
CURRENT LIABILITIES
Payables 2,474 1,813
Revenue received in advance 20 5,863 3,277
Interest-bearing liabilities 21(B) 669 969
Lease liabilities 16(C) 384 383
Other financial liabilities 27(C) 67 17
Provisions 22 1,101 1,136
Total current liabilities 10,558 7,595
NON-CURRENT LIABILITIES
Payables — 44
Revenue received in advance 20 2,066 2,154
Interest-bearing liabilities 21(B) 5,291 5,861
Lease liabilities 16(C) 888 1,016
Other financial liabilities 27(C) 246 5
Provisions 22 794 689
Total non-current liabilities 9,285 9,769
Total liabilities 19,843 17,364
Net assets (190) 443
EQUITY
Issued capital 23(A) 3,186 3,186
Treasury shares 23(B) (8) (18)
Reserves 649 432
Accumulated losses (4,024) (3,160)
Equity attributable to members of Qantas (197) 440
Non-controlling interests 7 3
Total equity (190) 443

The above Consolidated Balance Sheet should be read in conjunction with the accompanying notes.

1
The Group adopted the IFRIC agenda decision in relation to Cloud Computing (“IFRIC Cloud Computing decision”) retrospectively. The comparative period presented has been restated
accordingly. Refer to Note 39 for further information.

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 QANTAS ANNUAL REPORT 2022

Consolidated Statement of Changes in Equity

For the year ended 30 June 2022

Foreign
30 June 2022 Employee Currency Non-
Issued Treasury Compensation Hedge Translation Other1 Accumulated controlling Total
$M Capital Shares Reserve Reserve Reserve Reserves Losses Interests Equity
Balance as at 1 July 2021
2 3,186 (18) 34 176 26 196 (3,160) 3 443
(restated)
TOTAL COMPREHENSIVE (LOSS)/INCOME FOR THE YEAR
Statutory loss for the year — — — — — — (860) — (860)
Other comprehensive (loss)/income
Effective portion of changes in fair
— — — 492 — — — — 492
value of cash flow hedges, net of tax
Transfer of effective hedging gains
from hedge reserve to the
— — — (274) — — — — (274)
Consolidated Income Statement,
net of tax
De-designation of fuel and foreign
exchange hedges to the Consolidated — — — (20) — — — — (20)
Income Statement, net of tax
Recognition of effective cash flow
hedges on capitalised assets, — — — 3 — — — — 3
net of tax
Net changes in hedge reserve for
— — — 20 — — — — 20
time value of options, net of tax
Foreign currency translation of
— — — — (18) — — — (18)
controlled entities
Foreign currency translation of
investments accounted for under the — — — — 7 — — — 7
equity method
Share of other comprehensive
income of investments accounted — — — (3) — — — — (3)
for under the equity method
Defined benefit actuarial gains,
— — — — — 203 — — 203
net of tax
Fair value losses on investments,
— — — — — (22) — — (22)
net of tax
Transfer of accumulated fair value
— — — — — 6 (6) — —
losses to accumulated losses
Total other comprehensive — — — 218 (11) 187 (6) — 388
income for the year
Total comprehensive loss for — — — 218 (11) 187 (866) — (472)
the year
TRANSACTIONS WITH OWNERS RECORDED DIRECTLY IN EQUITY
Transactions with owners in their capacity as owners
Recognition of non-controlling
interest from acquisition of — — — — — — — 5 5
subsidiary
Recognition of put option over non-
— — — — — (224) — — (224)
controlling interest
Dividends paid — — — — — — — (1) (1)
Treasury shares acquired — (5) — — — — — — (5)
Share-based payments — — 63 — — — — — 63
Shares vested and transferred to
employees/shares unvested and — 15 (16) — — — 2 — 1
lapsed
Total transactions with owners in — 10 47 — — (224) 2 4 (161)
their capacity as owners
Balance as at 30 June 2022 3,186 (8) 81 394 15 159 (4,024) 7 (190)

The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.

1
Other reserves as at 30 June 2022 includes the defined benefit reserve of $381 million, put option reserve of ($224) million and the fair value reserve of $2 million.
2
The Group adopted the IFRIC agenda decision in relation to Cloud Computing (“IFRIC Cloud Computing decision”) retrospectively. The comparative period presented has been restated
accordingly. Refer to Note 39 for further information.

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 QANTAS ANNUAL REPORT 2022

Consolidated Statement of Changes in Equity continued

For the year ended 30 June 2022

30 June 2021 Foreign

(restated)2 Employee Currency Non-
Issued Treasury Compensation Hedge Translation Other1 Accumulate controlling Total
$M Capital Shares Reserve Reserve Reserve Reserves d Losses Interests Equity
Balance as at 1 July 2020 3,104 (51) 54 (147) 4 (84) (1,466) 3 1,417
TOTAL COMPREHENSIVE (LOSS)/INCOME FOR THE YEAR
Statutory loss for the year — — — — — — (1,692) — (1,692)
Other comprehensive (loss)/income
Effective portion of changes in
fair value of cash flow hedges, — — — 201 — — — — 201
net of tax
Transfer of effective hedging
losses from hedge reserve to the
— — — 49 — — — — 49
Consolidated Income Statement,
net of tax
De-designation of fuel and
foreign exchange hedges to the
— — — 15 — — — — 15
Consolidated Income Statement,
net of tax
Recognition of effective cash flow
hedges on capitalised assets, — — — 4 — — — — 4
net of tax
Net changes in hedge reserve for
— — — 42 — — — — 42
time value of options, net of tax
Foreign currency translation of
— — — — 10 — — — 10
controlled entities
Foreign currency translation of
investments accounted for under — — — — 12 — — — 12
the equity method
Share of other comprehensive
income of investments accounted — — — 12 — — — — 12
for under the equity method
Defined benefit actuarial gains,
— — — — — 251 — — 251
net of tax
Fair value gains on investments,
— — — — — 29 — — 29
net of tax
Total other comprehensive — — — 323 22 280 — — 625
income for the year
Total comprehensive loss for — — — 323 22 280 (1,692) — (1,067)
the year
TRANSACTIONS WITH OWNERS RECORDED DIRECTLY IN EQUITY
Transactions with owners in their capacity as owners
Capital raising, net of tax 82 — — — — — (6) — 76
Share-based payments — — 19 — — — — — 19
Shares vested and transferred to
employees/shares unvested and — 33 (39) — — — 4 — (2)
lapsed
Total transactions with owners in 82 33 (20) — — — (2) — 93
their capacity as owners
Balance as at 30 June 2021 3,186 (18) 34 176 26 196 (3,160) 3 443
1,2

The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.

1
Other reserves as at 30 June 2021 includes the defined benefit reserve of $178 million and the fair value reserve of $18 million.
2
The Group adopted the IFRIC agenda decision in relation to Cloud Computing (“IFRIC Cloud Computing decision”) retrospectively. The comparative period presented has been restated
accordingly. Refer to Note 39 for further information.

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QANTAS ANNUAL REPORT 2022

Consolidated Cash Flow Statement

For the year ended 30 June 2022

2022 2021
Notes $M $M
CASH FLOWS FROM OPERATING ACTIVITIES
Cash receipts from customers 12,236 7,507
Cash payments to suppliers and employees (excluding cash payments to employees for
(9,278) (6,726)
redundancies and related costs) and refunds to customers from receipts in prior periods
Cash payments to employees for redundancies and related costs (48) (926)
Interest received 13 15
Interest paid (interest-bearing liabilities) (186) (183)
Interest paid (lease liabilities) 16(C) (66) (73)
Foreign income taxes paid 9(D) (1) —
Net cash inflow/(outflow) from operating activities 29 2,670 (386)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for property, plant and equipment and intangible assets (906) (747)
Interest paid and capitalised on qualifying assets 8 (15) (21)
Proceeds from disposal of property, plant and equipment, net of costs 801 94
Payments for investments accounted for under the equity method (66) (48)
Payments for acquisition of subsidiary, net of cash acquired 35 (54) —
Net cash outflow from investing activities (240) (722)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from capital raising, net of costs — 58
Payments for treasury shares (2) —
Proceeds from interest-bearing liabilities, net of costs 21(D) 491 937
Repayments of interest-bearing liabilities 21(D) (1,441) (759)
Repayments of lease liabilities 16(C) (363) (420)
Proceeds from lease receivables 6 3
Dividends paid to non-controlling interests (1) —
Net cash outflow from financing activities (1,310) (181)
Net increase/(decrease) in cash and cash equivalents held 1,120 (1,289)
Cash and cash equivalents at the beginning of the year 2,221 3,520
Effects of exchange rate changes on cash and cash equivalents 2 (10)
Cash and cash equivalents at the end of the year 21(A) 3,343 2,221

The above Consolidated Cash Flow Statement should be read in conjunction with the accompanying notes.

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 QANTAS ANNUAL REPORT 2022

Notes to the Financial Statements

For the year ended 30 June 2022

1 STATEMENT OF COMPLIANCE AND BASIS OF PREPARATION

(A) REPORTING ENTITY
Qantas Airways Limited (Qantas) is a for-profit company limited by shares, incorporated in Australia, whose shares are publicly traded on the
Australian Securities Exchange (ASX) and which is subject to the operation of the Qantas Sale Act 1992 (Cth).
The Consolidated Financial Statements for the year ended 30 June 2022 comprise Qantas and its controlled entities (together referred to as
the Qantas Group or the Group) and the Qantas Group’s interest in investments accounted for under the equity method.
Qantas has eight subsidiaries that are material to the Qantas Group in 2022 (2021: six). The parent has majority voting rights in respect of
each of the material subsidiaries. Materiality has been assessed based on the expected long-term contribution of statutory profit to the
Qantas Group.
The Consolidated Financial Statements of Qantas for the year ended 30 June 2022 were authorised for issue in accordance with a resolution
of the Directors on 9 September 2022.
i. Statement of Compliance
The Consolidated Financial Statements are general purpose financial statements which have been prepared in accordance with the Australian
Accounting Standards (AASB) adopted by the Australian Accounting Standards Board and the Corporations Act 2001 (Cth). The Consolidated
Financial Statements also comply with International Financial Reporting Standards (IFRS) and the International Financial Reporting
Interpretations Committee (IFRIC) Interpretations adopted by the International Accounting Standards Board (IASB).
ii. Basis of Preparation
The Consolidated Financial Statements have been prepared on a going concern basis, which assumes the Group will be able to meet its
obligations as and when they fall due. The Consolidated Financial Statements are presented in Australian dollars, which is the functional
currency of the Qantas Group, and have been prepared on the basis of historical cost except in accordance with relevant accounting policies
where assets and liabilities are stated at their fair values in the following material items in the Consolidated Balance Sheet:
– Derivatives at fair value through profit and loss, and investments at fair value through other comprehensive income are measured at fair
value
– Assets classified as held for sale are measured at the lower of carrying amount and fair value less costs to sell
– Net defined benefit asset/(liability) is measured at the fair value of plan assets less the present value of the defined benefit obligation.
Qantas is a company of the kind referred to in Australian Securities and Investments Commission (ASIC) Corporations (Rounding in Financial/
Directors’ Reports) Instrument 2016/191. In accordance with that Instrument, all financial information presented has been rounded to the
nearest million dollars, unless otherwise stated.
(B) CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
The preparation of the Consolidated Financial Statements requires Management to make judgements, estimates and assumptions that affect
the application of accounting policies and reported amounts of assets, liabilities, income and expenses. It also requires the exercise of
judgement in the process of applying the Group’s accounting policies. The estimates and associated assumptions are based on historical
experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for
making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may
differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis, as appropriate to the particular circumstances. Revisions to
accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected. In preparing this Report,
judgements made by Management in the application of Australian Accounting Standards that have a significant effect on the Consolidated
Financial Statements and estimates with a significant risk of material adjustment in future periods are included in the following notes:
– Note 1(C) – Impact of COVID-19 on Financial Reporting
– Note 25 – Impairment of Assets and Related Costs
– Note 27(C) – Derivatives and Hedging Instruments
– Note 30 – Superannuation
– Note 38(D) – Summary of Significant Accounting Policies (Revenue Recognition)
– Note 38(M) – Summary of Significant Accounting Policies (Provisions).
Impact of climate change on financial reporting
The Group recognises that human-induced climate change is a significant issue for the aviation industry and is committed to reducing
emissions in line with the Paris Climate Agreement to limit warming to well below two degrees Celsius above pre-industrial levels.
In 2019, the Group announced its commitment to achieving net zero emissions by 2050 and capping net emissions at 2019 levels. In March
2022, the Group announced new greenhouse gas emission targets as part of the Climate Action Plan (CAP), including:
– 25 per cent reduction in net emissions from 2019 levels by 2030
– 10 per cent Sustainable Aviation Fuel (SAF) in fuel mix by 2030
– Average of 1.5 per cent fuel efficiency improvements to 2030.
The Qantas Group’s long-term strategy acknowledges the potential impact of climate change and resource constraints on the business.
Climate-related risks and opportunities are also addressed in the Qantas Group’s CAP launched in March 2022.

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 QANTAS ANNUAL REPORT 2022

Notes to the Financial Statements continued

For the year ended 30 June 2022

1 STATEMENT OF COMPLIANCE AND BASIS OF PREPARATION (CONTINUED)

(B) CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (CONTINUED)

Three pillars support the achievement of the Group’s interim targets as detailed in the CAP:
– Operational and fleet efficiency: Embracing new, low emission technology as it becomes available. Continuing to reduce fuel burn,
including smarter flight planning. Reducing single-use plastic and waste to landfill
– Sustainable Aviation Fuels (SAF): Working with governments, industry and businesses to develop a SAF industry in Australia. This relies on
creating SAF from crops or waste materials that can power our existing fleet and reduce emissions by up to 80 per cent, as well as
advancing new power-to-liquid technology
– Carbon offsets: Offsetting emissions by investing in high-quality, high-integrity Australian and international projects with community co-
benefits, including those led by Traditional Owners.
The Group’s Financial Plan incorporates estimates of known future impacts on the Group of meeting the interim targets as detailed in the CAP,
including the financial impact within cash flow projections of the increased cost of carbon offsetting and SAF (together with estimated
recovery through revenue) and capital expenditure to introduce more fuel-efficient aircraft.
In preparing the Consolidated Financial Statements, the medium and long-term cash flow impacts of meeting the interim targets in the CAP
have been considered in key estimates, including:
– The estimates of future cash flows used in impairment assessments of the Group’s Cash Generating Units (CGUs)
– The estimates of future profitability used to assess the recoverability of deferred tax assets, particularly relating to carried forward tax
losses
– The assessment of the useful lives of aircraft identified in the Group fleet plan to be retired as part of the introduction of more fuel-
efficient aircraft.
(C) IMPACT OF COVID-19 ON FINANCIAL REPORTING
The impact of COVID-19 on the Qantas Group has been unprecedented and continues to evolve as recovery progresses domestically and
internationally. The section below outlines key areas of impact relevant to the Consolidated Financial Statements for the year ended 30 June
2022. Additional information on how the Group has been impacted by COVID-19 and its ongoing response is provided in the Review of
Operations.
i. Overview of COVID-19 Impact on the Qantas Group and the Group’s Recovery Plan
The measures taken by governments across the world to slow the spread of COVID-19 through travel restrictions, border closures and
imposing localised or state-wide lockdowns continued to severely impact airlines across the 2021/22 financial year. These travel restrictions,
and the resulting decrease in demand, resulted in significant capacity reductions domestically and internationally. Throughout the year,
particularly due to the impact of the Delta and Omicron variants of the COVID-19 virus, the Group continued to take decisive action to mitigate
the impact of COVID-19, including reductions in flight capacity (domestic and international), workforce stand downs, operational cost-out
measures and capital expenditure deferrals. As travel restrictions were progressively lifted and borders were re-opened, the Group moved
swiftly to increase flight capacity and stand up the workforce to meet the rapid recovery in domestic demand and the progressive recovery of
international demand.
Governments worldwide announced relief packages to support affected businesses, including the aviation industry, to mitigate the impact of
COVID-19. The International Aviation Support (IAS) program was introduced to maintain a core Australian international aviation capability and
ensure Australian airlines could quickly recommence commercial international flights as international restrictions were lifted. This program
also included employee support payments made directly to employees through the International Readiness Payment (IRP). The Retaining
Domestic Airlines Capacity (RDAC) program was introduced to assist airlines maintain core domestic aviation capabilities through the
retention of essential aviation section skills and knowledge to ensure airlines could quickly increase capacity as border restrictions eased.
This program also included employee support payments made directly to employees through the Domestic Retention Payment (DRP) for
those who were not eligible for the Commonwealth Disaster Payment to maintain an agreed level of domestic capacity. With travel
restrictions lifting, borders re-opening and the workforce being stood up, the IAS, IRP, RDAC and DRP ceased during the 2021/22 financial
year.
In addition, the Australian Government commissioned Qantas to conduct various charter repatriation flights and, along with other Australian
domestic airlines, Qantas also operated domestic and regional flights as part of the Regional Airline Network Support (RANS), Domestic
Aviation Network Support (DANS) and Tourism Aviation Network Support (TANS) intended to maintain vital air transport links. Qantas also
secured a contract to conduct freight services under the International Freight Assistance Mechanism (IFAM) to ensure import and export
freight routes remained open.

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 QANTAS ANNUAL REPORT 2022

Notes to the Financial Statements continued

For the year ended 30 June 2022

1 STATEMENT OF COMPLIANCE AND BASIS OF PREPARATION (CONTINUED)

(C) IMPACT OF COVID-19 ON FINANCIAL REPORTING (CONTINUED)
i. Overview of COVID-19 Impact on the Qantas Group and the Group’s Recovery Plan (continued)
Recovery Plan
COVID-19 represents the biggest challenge ever faced by global aviation and the Group’s response to the pandemic is scaled accordingly. In
June 2020, the Group announced a three-year plan to accelerate recovery from the COVID-19 crisis and create a stronger platform for future
profitability, long-term shareholder value and to preserve as many jobs as possible.
The immediate focus of the plan was to:
– Rightsize the Group’s workforce, fleet and other costs according to demand projections, with the ability to scale up as flying returns
– Restructure to deliver ongoing cost savings and efficiencies across the Group’s operations in a changing market
– Recapitalise through an equity raising completed in August 2020 to strengthen the Group’s financial resilience to recovery and the
opportunities it presents.
The ongoing impact of the COVID-19 crisis and the structural changes within the aviation industry underscore the importance of the Qantas
Group’s own program of restructuring. The Three-Year Recovery Plan developed in June 2020 has been updated as the Group responds to the
evolving and ongoing impacts of COVID-19 (Recovery Plan).
Key actions during the financial year 2021/22:
– Delivered $920 million in structural cost benefits to date. On track for $1 billion in annual cost improvements from financial year 2022/23
with all initiatives now commenced and greater than 90 per cent completed
– Restart of domestic and international operations well underway, supported by the return of all stood down Australian-based employees in
December 2021
– Generated positive Statutory Net Free Cash Flow delivering debt reduction. Cash flow generation driven by domestic recovery, significant
Qantas Loyalty cash flow contribution, record Freight performance and proceeds from Mascot land sale
– Net Debt reduced to $3.94 billion at June 2022, below target Net Debt range of $4.2 billion to $5.2 billion
– Maintained strong liquidity and retained Baa2 investment grade credit rating.
Looking into financial year 2022/23 priorities include:
– Operational performance has been challenged in recovery and plans are in place to restore operational performance to pre-COVID levels
– Deliver the targeted $1 billion in annual cost improvements
– Continued focus on customer experience with investment in digital, aircraft, lounges and Loyalty program rewards
– Rewarding employees with a range of measures for their contribution to the Group’s recovery.
ii. Capital Structure and Liquidity
The Qantas Group’s Financial Framework is designed to achieve top quartile Total Shareholder Return relative to the ASX100 and global airline
peers. The Framework’s key elements are to:
– Maintain an optimal capital structure that minimises the cost of capital by holding an appropriate level of Net Debt.1 The appropriate level
of Net Debt reflects the Qantas Group’s size, measured by Invested Capital. This is consistent with investment grade credit metrics
– Deliver ROIC that exceeds the weighted average cost of capital throughout the cycle
– Make disciplined capital allocation decisions between reinvestment, debt reduction and distribution of surplus capital to shareholders
while maintaining an optimal capital structure.
Surplus capital is determined on a forward-looking basis, which is the difference between the projected Net Debt position and the target Net
Debt position.
The Qantas Group maintains access to a broad range of debt markets, both secured and unsecured. The Qantas Group maintains a prudent
liquidity policy that ensures adequate coverage of liquidity requirements while considering a range of adverse scenarios.
During the 2021/22 financial year, the Group raised $491 million of additional debt and repaid $1,441 million of debt, including the repayment
of a $300 million bond in May 2022 and a prepayment of $450 million of Corporate Secured Debt program in June 2022.
The Group extended the maturity of its committed undrawn facilities and as at 30 June 2022, the Group’s available liquidity is $4.6 billion,
including $3.3 billion of cash and cash equivalents and $1.3 billion of undrawn facilities.
As at 30 June 2022, Net Debt (as measured by the Group’s Financial Framework) is $3.94 billion, with no financial covenants.
The Group continues to hold an investment grade credit rating from Moody’s (Baa2).

1
Net Debt includes on balance sheet debt and capitalised aircraft lease liabilities under the Group’s Financial Framework. Capitalised aircraft lease liabilities are measured at the fair
value of the aircraft at the lease commencement date and remeasured over the lease term on a principal and interest basis. The residual value of capitalised aircraft lease liabilities
denominated in foreign currency is translated at the long-term exchange rate.

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 QANTAS ANNUAL REPORT 2022

Notes to the Financial Statements continued

For the year ended 30 June 2022

1 STATEMENT OF COMPLIANCE AND BASIS OF PREPARATION (CONTINUED)

(C) IMPACT OF COVID-19 ON FINANCIAL REPORTING (CONTINUED)
ii. Capital Structure and Liquidity (continued)
Net asset position of the Group at 30 June 2022
The Group’s net asset position of ($190) million at 30 June 2022 (2021: $443 million) is a direct result of the losses incurred since the
outbreak of COVID-19. The Group incurred significant statutory losses after tax in the second half of financial year 2019/20, and in financial
years 2020/21 and 2021/22 of ($2,409) million, $(1,692) million and $(860) million respectively. The negative net asset position does not
impact the Group’s ability to continue as a going concern or pay its debts as and when they become due and payable.
At 30 June 2022, the Group’s Net Debt of $3.94 billion (below the target Net Debt range of $4.2 billion to $5.2 billion) was significantly reduced
from $5.89 billion at 30 June 2021 due to the Net Free Cash Flow of $2.4 billion generated during financial year 2021/22. The Group has
available liquidity of $4.6 billion, including $3.3 billion of cash and cash equivalents and a $1.3 billion undrawn facility.
iii. Impact on Accounting Judgements and Estimates
The Group’s Financial Plan (including the completion of the Three-Year Recovery Plan in response to COVID-19) has influenced certain
accounting judgements and estimates, impacting the Annual Report for the year ended 30 June 2022.
The Financial Plan (including the completion of the Three-Year Recovery Plan) influenced key judgements and estimates within the following
areas of the Financial Report:

Area of Annual Report Impact on Judgements and Estimates

Impairment testing The Financial Plan informed cash flows used in the determination of the recoverable amount of cash
generating units using the value in use method.
Refer to Note 25 for further details on impairment testing.
Fleet strategy The Financial Plan informed judgements around the Group’s fleet strategy which influences estimates
impacting property, plant and equipment, right of use assets, lease liabilities and provisions (including
provisions for makegood on leased assets).
Provision for redundancies Decisions and actions to implement the Financial Plan have informed the recognition of redundancy
provisions as at 30 June 2022.
Refer to Note 22 for further details on redundancies.
Hedge designation and hedge The Recovery Plan informed key inputs to hedging designation and hedge accounting requirements
accounting including forecast fuel consumption and forecast income and expenditure denominated in foreign
currencies.
Refer to Note 27(C) for details on hedge designation and hedge accounting.
Balance sheet presentation The Financial Plan informed judgements around the presentation of balance sheet items, particularly in
relation to the presentation of revenue received in advance as either current or non-current.
Revenue recognition (Impact of The significant impact of COVID-19, together with strategies within the Financial Plan, informed
breakage assumptions) assumptions around customer and member behaviour and customer engagement strategies which
impacted assumptions around breakage.
Income tax The Financial Plan informed judgement around the recognition and recoverability of a net deferred tax
asset relating to income tax losses.
Refer to Note 9 for details on Income Tax and Note 18 on Deferred Tax Assets.

2 OPERATING SEGMENTS, UNDERLYING PROFIT BEFORE TAX AND RETURN ON INVESTED CAPITAL
(A) OPERATING SEGMENTS
The Qantas Group comprises the following operating segments:

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 QANTAS ANNUAL REPORT 2022

Notes to the Financial Statements continued

For the year ended 30 June 2022

2 OPERATING SEGMENTS, UNDERLYING PROFIT BEFORE TAX AND RETURN ON INVESTED CAPITAL (CONTINUED)
(A) OPERATING SEGMENTS (CONTINUED)
i. Underlying EBIT
Underlying EBIT is the primary reporting measure used by the Qantas Group’s Chief Operating Decision-Making bodies (CODM), being the Chief
Executive Officer, Group Management Committee and the Board of Directors, for the purpose of assessing the performance of Qantas
Domestic, Qantas International, Jetstar Group, and Qantas Loyalty operating segments. The primary reporting measure of the Corporate
segment is Underlying PBT, as net finance costs are managed centrally and are not allocated to the Qantas Domestic, Qantas International,
Jetstar Group or Qantas Loyalty operating segments.
Underlying EBIT is calculated as Underlying PBT as outlined below (refer to Note 2(B)) but excluding the impact of net finance costs.
ii. Analysis by Operating Segment
2022 Qantas Qantas Jetstar Qantas Unallocated/
$M Domestic International Group Loyalty Corporate Eliminations1 Consolidated
REVENUE AND OTHER INCOME
External segment revenue and other income 3,127 3,615 1,388 1,284 10 (316) 9,108
Inter-segment revenue and other income 321 91 52 50 — (514) —
Total segment revenue and other income 3,448 3,706 1,440 1,334 10 (830) 9,108
Share of net loss of investments accounted for
(1) (1) (124) — — — (126)
under the equity method
Underlying EBITDA2 (27) 448 (448) 351 (121) 78 281
Depreciation and amortisation (700) (686) (348) (59) (8) — (1,801)
Impairment3 (38) — — — — — (38)
Underlying EBIT (765) (238) (796) 292 (129) 78 (1,558)
Net finance costs (301) (301)
Underlying PBT (430) (1,859)
ROIC %4 (31.6%)
2021
Qantas Qantas Jetstar Qantas Unallocated/
(restated)5 Domestic International Group Loyalty Corporate Eliminations1 Consolidated
REVENUE AND OTHER INCOME
External segment revenue and other income 2,496 1,584 1,105 962 5 (218) 5,934
Inter-segment revenue and other income 249 14 35 22 — (320) —
Total segment revenue and other income 2,745 1,598 1,140 984 5 (538) 5,934
Share of net profit/(loss) of investments 1 1 (131) — — — (129)
accounted for under the equity method
Underlying EBITDA2 159 117 (129) 333 (87) 17 410
Depreciation and amortisation3 (731) (663) (409) (56) (11) — (1,870)
Impairment3 (3) (2) (3) (5) — — (13)
Underlying EBIT (575) (548) (541) 272 (98) 17 (1,473)
Net finance costs (301) (301)
Underlying PBT (399) (1,774)
ROIC %4 (21.4%)
1 Unallocated/Eliminations represents unallocated and other businesses of the Qantas Group that are not considered to be reportable segments, including consolidation elimination
entries. It also includes the impact of discount rate changes on provisions (refer to Note 7) and changes in presentation of income/expenses where the determination of whether the
Group is acting as principal or agent is made on consolidation. For the year ended 30 June 2022, Unallocated/Eliminations also includes the recognition of the Recovery Boost bonus
for EBA-covered employees announced in June 2022 and the Recovery Retention bonuses announced in February 2022, expensed in accordance with relevant Accounting Standards.
2 Underlying EBITDA represents underlying earnings before income tax expense, depreciation, amortisation, net finance costs and impairment. Refer to Note 2(B).
3 Depreciation and amortisation and impairment differs from the depreciation and amortisation and impairment recognised in the Consolidated Income Statement due to items not
included in Underlying PBT.
4 ROIC % represents Return on Invested Capital (ROIC) EBIT divided by Average Invested Capital. Refer to Note 2(C).
5 The Group adopted the IFRIC agenda decision in relation to Cloud Computing (“IFRIC Cloud Computing decision”) retrospectively. The comparative period presented has been restated
accordingly. Refer to Note 39 for further information.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

2 OPERATING SEGMENTS, UNDERLYING PROFIT BEFORE TAX AND RETURN ON INVESTED CAPITAL (CONTINUED)
(A) OPERATING SEGMENTS (CONTINUED)
ii. Analysis by Operating Segment (continued)
Passenger revenue primarily arises within the Qantas Domestic, Qantas International and Jetstar Group segments. Freight revenue primarily
arises within Qantas International, except when belly space is utilised in Qantas Domestic and Jetstar Group.
Marketing revenue and redemption revenue in relation to the issuance and redemption of Qantas Points is recognised within the Qantas
Loyalty segment. Marketing revenue on inter-segment Qantas Point issuances is eliminated on consolidation. Redemption revenue arising
from Qantas Group flight redemptions is recognised within Net Passenger Revenue on consolidation. The inter-segment arrangements with
Qantas Loyalty are not designed to derive a net profit from inter-segment Qantas Point issuances and redemptions.
Redemption revenue in relation to products provided by suppliers outside the Group, such as Qantas Rewards Store redemptions and other
carrier redemptions is recognised in the Consolidated Income Statement net of related costs, as the Group is an agent. For the purposes of
segment reporting, the Qantas Loyalty segment reports these redemptions on a gross basis. Adjustments are made within consolidation
eliminations to present these redemptions on a net basis at a Group level within Other Revenue and Income.
(B) UNDERLYING PROFIT BEFORE TAX (UNDERLYING PBT) AND RECONCILIATION TO STATUTORY (LOSS)/PROFIT BEFORE TAX
Underlying PBT is a non-statutory measure and is the primary reporting measure used by the CODM for the purpose of assessing the
performance of the Group. The objective of measuring and reporting Underlying PBT is to provide a meaningful and consistent representation
of the underlying performance of each operating segment and the Qantas Group.
Underlying PBT includes the impact of COVID-19 on the operating performance of the Group. Group revenue for the financial year 2021/22 as
recognised within Underlying PBT is down $8.9 billion compared to the financial year 2018/19 (pre-COVID), which is consistent with the
reduction of revenue within the Group’s Statutory Loss.
Likewise, the impact of the decisive actions taken by the Group to mitigate the impact of COVID-19, including reducing flight capacity
domestically and internationally (with associated reductions in fuel and other variable costs), workforce stand downs and operational cost
reduction measures, has also been recognised in Underlying PBT. Government support to mitigate the impact of COVID-19 from travel
restrictions and border closures, including the IAS, RDAC, RANS, DANS, TANS, government repatriation flights and IFAM payments, together
with costs to operate or payments to employees, is also recorded in Underlying PBT.
Items which are identified by Management and reported to the CODM bodies as not representing the underlying performance of the business
are not included in Underlying PBT. The determination of these items is made after consideration of their nature and materiality and is applied
consistently from period to period.
Items not included in Underlying PBT primarily result from revenues or expenses relating to business activities in other reporting periods,
restructuring/transformation initiatives, transactions involving investments, impairments of assets and other transactions outside the
ordinary course of business.
The impact of COVID-19 and the Group’s Recovery Plan resulted in items not included in Underlying PBT, including asset impairments, and
Recovery Plan restructuring costs, including redundancies and de-designated hedging due to a significant decrease in flying activity. De-
designations or ineffectiveness relating to hedging which were designated subsequent to the impact of COVID-19 are considered to have
occurred within the ordinary course of business and is recognised within Underlying PBT.
2021
2022 (restated)
RECONCILIATION OF UNDERLYING PBT TO STATUTORY LOSS BEFORE TAX $M $M
Underlying PBT (1,859) (1,774)
Items not included in Underlying PBT
– Recovery Plan restructuring costs (21) (319)
– Reversal of impairment/(Impairment) of assets and related costs 3 (257)
– De-designation of pre-COVID fuel and foreign exchange hedges — 33
– Net gain on Mascot land and buildings 686 —
– Net gain on disposal of assets — 18
Total items not included in Underlying PBT 668 (525)
Statutory Loss Before Income Tax Expense (1,191) (2,299)
In the 2021/22 financial year, the items outside of Underlying PBT included:
Item Outside of
Underlying PBT Description
Recovery Plan $21 million primarily relates to $14 million of restructuring costs resulting from fleet and people restructuring as
restructuring costs a result of the Recovery Plan and $7 million acquisition and launch costs for new businesses.
Reversal of impairment of $3 million of reversal of impairment relates to $1 million net reversal of impairment relating to the Group’s
assets and related costs investment in Helloworld and $2 million other impairment reversals.
Net gain on disposal of The net gain on disposal of assets of $686 million arose from the sale of land in Mascot, Sydney that was not
assets core to the Group’s long-term strategy.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

2 OPERATING SEGMENTS, UNDERLYING PROFIT BEFORE TAX AND RETURN ON INVESTED CAPITAL (CONTINUED)
(B) UNDERLYING PROFIT BEFORE TAX (UNDERLYING PBT) AND RECONCILIATION TO STATUTORY (LOSS)/PROFIT BEFORE TAX (CONTINUED)
The 2020/21 financial year included the following items:
Item Outside of
Underlying PBT Description
Recovery Plan $319 million included people restructuring costs of $297 million and other restructuring costs of $22 million.
restructuring costs People restructuring costs include redundancy costs related to announced restructuring initiatives. Other
restructuring costs primarily resulted from changes to fleet strategy as a result of the Recovery Plan. Included in
other restructuring costs is $7 million of non-cash accelerated depreciation.
Impairment of assets and Impairments of assets and related costs of $257 million includes:
related costs – $155 million impairment of the Group’s A380 fleet resulting from changes in the recoverable amount or net
realisable value of the assets, including from changes in the market value of the aircraft, changes in the
onerous contractual commitments and movement in foreign exchange rates since 30 June 2020
– $73 million impairment of property, plant and equipment and right of use assets relating to aircraft in the
Jetstar Asia cash generating unit
– $3 million impairment relating to the early retirement of the Group’s 747 fleet driven by movement in foreign
exchange rates since 30 June 2020
– $27 million impairment of property, plant and equipment, intangible assets and other assets from the
implementation of restructuring initiatives in the Recovery Plan
– ($1) million of net impairment reversal of assets in relation to the Group’s associates.
Refer to Note 25 for details on impairment of assets and related costs.
De-designation of fuel The Group hedges fuel price risk in accordance with its Treasury Risk Management Policy. Hedge accounting is
and foreign exchange applied when the requirements of AASB 9 Financial Instruments (AASB 9) are met. Where the forecast fuel
hedges purchase transaction is no longer expected to occur, then hedge accounting is discontinued prospectively and
the amount accumulated in equity is reclassified to the Consolidated Income Statement.
The significant decrease in flying activity compared to expectations at 30 June 2020 has resulted in hedge
accounting being discontinued where forecast fuel purchases are no longer expected to occur.
Where the underlying derivatives, while de-designated for hedge accounting purposes, had remained unrealised
or unsettled, foreign exchange and mark-to-market movements have occurred. These movements have also
been recognised as ineffectiveness in the Consolidated Income Statement.
De-designation and ineffectiveness of fuel and foreign exchange hedges of $33 million has been recognised
immediately in the Consolidated Income Statement. Refer to Note 27 for further details.
Net gain on disposal of $18 million net gain on disposal primarily relates to a $15 million gain on sale of Qantas’ interest in the Joint User
assets Hydrant Installation.

(C) RETURN ON INVESTED CAPITAL

Return on Invested Capital (ROIC %) is a non-statutory measure and is the primary financial return measure of the Group. ROIC % is calculated
as Return on Invested Capital EBIT (ROIC EBIT) divided by Average Invested Capital.
i. ROIC EBIT
ROIC EBIT is derived by adjusting Underlying EBIT for the year to exclude leased aircraft depreciation under AASB 16 Leases (AASB 16) and to
include notional depreciation for these aircraft to account for them as if they were owned.
In addition, for non-aircraft leases, ROIC EBIT is reduced for the full lease payments rather than depreciation under AASB 16 to account for
these items as a service cost. The objective of these adjustments is to show an EBIT result which is indifferent to the financing or ownership
structure of aircraft assets and that treats non-aircraft leases as a service cost rather than a debt repayment.
2021
2022 (restated)
$M $M
ROIC EBIT
Underlying EBIT (1,558) (1,473)
Add back: Lease depreciation under AASB 16 336 373
Less: Notional depreciation1 (118) (105)
Less: Cash expenses for non-aircraft leases (219) (199)
ROIC EBIT (1,559) (1,404)
Average Invested Capital for the year ended 30 June 4,928 6,553
ROIC %2 (31.6%) (21.4%)
1 For calculating ROIC, capitalised leased aircraft are included in the Group's Invested Capital at the AUD market value (referencing AVAC) at the date of commencing operations at the
prevailing AUD/USD rate. This value is depreciated notionally in accordance with the Group's accounting policies, with the calculated depreciation reported above known as notional
depreciation.
2 ROIC % represents Return on Invested Capital (ROIC) EBIT divided by Average Invested Capital. Refer to Note 2(C)ii. and 2(C)iii.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

2 OPERATING SEGMENTS, UNDERLYING PROFIT BEFORE TAX AND RETURN ON INVESTED CAPITAL (CONTINUED)
(C) RETURN ON INVESTED CAPITAL (CONTINUED)
ii. Average Invested Capital
The objective of the Group's Financial Framework is to show Invested Capital which is indifferent to financing or ownership structures of
aircraft assets (leased versus owned). Invested Capital includes the net assets of the business other than cash, lease receivables, interest-
bearing liabilities, other financial assets/(liabilities) and tax balances as well as lease liabilities and right of use assets (for leased aircraft,
property and other assets) as measured under AASB 16.
To account for the capital invested in leased aircraft, Invested Capital includes an amount representing the capitalised value of leased aircraft
assets as if they were owned. Invested Capital includes the full capital held in leased aircraft, which is a non-statutory adjustment, as in
accordance with AASB 16 right of use assets are only measured with reference to the lease term.
Average Invested Capital is equal to the average of the monthly Invested Capital for the year.
2021
2022 (restated)
Invested Capital $M $M
Receivables (current and non-current) 1,107 633
Inventories 269 279
Other assets (current and non-current) 1,170 856
Investments accounted for under the equity method 57 57
Property, plant and equipment 10,224 10,787
Intangible assets 778 745
Assets classified as held for sale 1 1
Payables (current and non-current) (2,474) (1,857)
Provisions (current and non-current) (1,895) (1,825)
Revenue received in advance (current and non-current) (7,929) (5,431)
Capitalised aircraft leased assets1 1,892 1,751
Invested Capital as at 30 June 3,200 5,996
Average Invested Capital for the year ended 30 June 4,928 6,553
1 For calculating ROIC, all statutory aircraft leases balances and provisions related to leased aircraft are adjusted to represent the capitalised value of leased aircraft, as if they were
owned. Capitalised leased aircraft are included in the Group's Invested Capital at the AUD market value (referencing AVAC) at the date of commencing operations at the prevailing
AUD/USD rate. This value is notionally depreciated in accordance with the Group's accounting policies, with the calculated depreciation reported above known as notional
depreciation. The carrying value of leased aircraft (AUD market value less accumulated notional depreciation) and an adjustment to exclude aircraft lease return provisions is reported
within Invested Capital as capitalised leased aircraft.

iii. ROIC %
2021
2022 (restated)
% %
ROIC %1 (31.6) (21.4)
1 ROIC % is calculated as Return on Invested Capital EBIT (ROIC EBIT) divided by Average Invested Capital for the year.

iv. ROIC (Statutory EBIT) %

2021
2022 (restated)
% %
ROIC (Statutory EBIT) %1 (18.1) (29.4)
1 ROIC (Statutory EBIT) % is calculated by replacing Underlying EBIT with Statutory EBIT, maintaining a consistent methodology to ROIC % as outlined in Note 2(C)i. to iii.

v. Underlying Earnings Per Share

2021
2022 (restated)
cents cents
Underlying Loss Per Share1 (71.2) (69.4)
1 Underlying Earnings Per Share is calculated as Underlying Loss Before Tax less tax benefit based on the Group’s effective tax rate of (27.8 per cent) (2021:(26.4 per cent)) divided by
the weighted average number of shares outstanding during the year, excluding unallocated treasury shares.

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 QANTAS ANNUAL REPORT 2022

Notes to the Financial Statements continued

For the year ended 30 June 2022

3 EARNINGS PER SHARE

2021
2022 (restated)
cents cents
1
Basic loss per share (45.6) (89.9)
2
Diluted loss per share (45.6) (89.9)
1 Weighted average number of shares used in basic Earnings Per Share calculation of 1,886 million (2021: 1,882 million) excludes unallocated treasury shares.
2 Weighted average number of shares used in basic and diluted Earnings Per Share calculation is the same for the financial years ended 30 June 2022 and 30 June 2021 as the effect
of share rights expected to vest are anti-dilutive and excluded from the calculation. Weighted average number of shares used in diluted Earnings Per Share calculation of 1,886 million
(2021: 1,882 million) excludes unallocated treasury shares.

2021
2022 (restated)
$M $M
Statutory loss attributable to members of Qantas (860) (1,692)

2022 2021
Number Number
NUMBER OF SHARES M M
Issued shares as at 1 July 1,886 1,864
Capital raising — 22
Issued shares as at 30 June 1,886 1,886
Weighted average number of shares for the year 1,886 1,883

4 REVENUE AND OTHER INCOME

(A) REVENUE AND OTHER INCOME BY GEOGRAPHIC AREA
2022 2021
$M $M
Net passenger and freight revenue
Australia 6,026 4,214
Overseas 1,888 868
Total net passenger and freight revenue 7,914 5,082
Other revenue and income 1,194 852
Total revenue and other income 9,108 5,934
Net passenger and freight revenue is attributed to a geographic region based on the point of sale, or where not directly available, on a pro-rata
basis. Other revenue and income is not allocated to a geographic region as it is impractical to do so.

(B) OTHER REVENUE AND INCOME

2022 2021
$M $M
Frequent Flyer marketing revenue and other Qantas Loyalty businesses 537 431
Qantas Rewards Store and other redemption revenue1,2 64 81
Third-party services revenue 185 128
Other income 408 212
Total other revenue and income 1,194 852
1 Frequent Flyer redemption revenue excludes redemptions on Qantas Group flights which are reported as net passenger revenue in the Consolidated Income Statement.
2 Where the Group acts as an agent for redemptions, an adjustment is made within consolidation eliminations to present these redemptions on a net basis.

5 DEPRECIATION AND AMORTISATION

2021
2022 (restated)
Notes $M $M
Property, plant and equipment 15 1,345 1,356
Right of use assets 16(A) 336 373
Intangible assets 17 120 148
Total depreciation and amortisation 1,801 1,877

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Notes to the Financial Statements continued

For the year ended 30 June 2022

6 NET GAIN ON DISPOSAL OF ASSETS

2022 2021
$M $M
Net gain on disposal of property, plant and equipment1 (692) (26)
Total net gain on disposal of assets (692) (26)
1 Net gain on disposal of property, plant and equipment includes $686 million relating to the net gain on sale of Mascot land and buildings.

7 OTHER EXPENDITURE
2022 2021
$M $M
Commissions and other selling costs 263 166
Computer and communication 452 320
Capacity hire (excluding lease components) 194 139
Property occupancy and utility expenses 120 121
Marketing and advertising 99 70
Discretionary bonuses to non-executive employees 124 —
Discount rate changes impact on provisions (194) (4)
Other 487 246
Total other expenditure 1,545 1,058

8 NET FINANCE COSTS

2022 2021
Note $M $M
FINANCE INCOME
Interest income on financial assets measured at amortised cost 13 15
Unwind of discount on receivables 4 5
Total finance income 17 20
FINANCE COSTS
Interest expense on financial liabilities measured at amortised cost (232) (240)
Interest expense on leases 16(C) (73) (75)
Interest paid and capitalised on qualifying assets1 15 21
Total finance costs on financial liabilities (290) (294)
Unwind of discount on provisions and other liabilities
Employee benefits (9) (4)
Other liabilities and provisions (19) (23)
Total unwind of discount on other liabilities and provisions (28) (27)
Total finance costs (318) (321)
Net finance costs (301) (301)
1 The borrowing costs are capitalised using a 3.4 per cent interest rate (2021: 3.8 per cent).

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Notes to the Financial Statements continued

For the year ended 30 June 2022

9 INCOME TAX BENEFIT

(A) INCOME TAX RECOGNISED IN THE CONSOLIDATED INCOME STATEMENT

2021
2022 (restated)
$M $M
Current income tax expense
Current income tax – Australia — —
Current income tax – foreign — (1)
Total current income tax expense — (1)
Deferred income tax benefit
Origination and reversal of temporary differences 111 (65)
Benefit of tax losses 222 671
Current year deferred income tax benefit 333 606
Adjustments for the prior year (2) 2
Total deferred income tax benefit 331 608
Total income tax benefit in the Consolidated Income Statement 331 607

(B) RECONCILIATION BETWEEN INCOME TAX BENEFIT AND STATUTORY LOSS BEFORE INCOME TAX
2021
2022 (restated)
$M $M
Statutory loss before income tax benefit (1,191) (2,299)
Income tax benefit using the domestic corporate tax rate of 30 per cent 357 690
Adjusted for:
Differences in loss from investments accounted for under the equity method (37) (38)
Losses for foreign branches not recognised (16) (9)
Losses for controlled entities not recognised (13) (38)
Non-assessable gain on property, plant and equipment 43 1
Other net non-assessable items (5) (1)
Over provision from prior periods 2 2
Income tax benefit 331 607

(C) INCOME TAX (EXPENSE)/BENEFIT RECOGNISED DIRECTLY IN THE CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
2022 2021
$M $M
Income tax on:
Cash flow hedges (95) (133)
Defined benefit actuarial gains (87) (108)
Fair value losses/(gains) on investments 9 (15)
Income tax expense recognised directly in the Consolidated Statement of Comprehensive Income (173) (256)

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Notes to the Financial Statements continued

For the year ended 30 June 2022

9 INCOME TAX BENEFIT (CONTINUED)

(D) RECONCILIATION OF INCOME TAX BENEFIT TO INCOME TAX (PAYABLE)/RECEIVABLE
2021
2022 (restated)
$M $M
Income tax benefit 331 607
Adjusted for temporary differences:
Receivables (13) 69
Inventories 1 (1)
Investments accounted for under the equity method (1) (1)
Property, plant and equipment and intangible assets (35) 87
Right of use assets (51) (66)
Payables 12 11
Revenue received in advance (28) (78)
Interest-bearing liabilities (12) 4
Lease liabilities 38 123
Other financial assets/(liabilities) 18 (16)
Provisions (12) 78
Other items (28) (145)
Temporary differences (111) 65
Adjustments for the prior year 2 (2)
Value of recognised tax losses 222 670
Tax losses recognised (Australian)1 (222) (671)
Income tax receivable/(payable)2 — (1)
1 A deferred tax asset of $222 million has been recognised for income tax losses and is expected to be recovered in future periods.
2 Financial year 2020/21 net income tax payable of $1 million relates to overseas income tax and is reported in payables.

10 DIVIDENDS AND OTHER SHAREHOLDER DISTRIBUTIONS

(A) DIVIDENDS DECLARED AND PAID
During the year ended 30 June 2022, the Group did not declare or pay any dividends. No dividend will be paid in relation to the year ended
30 June 2022.
(B) OTHER SHAREHOLDER DISTRIBUTIONS
In August 2022, the Directors announced an on-market buy-back of up to $400 million.
(C) FRANKING ACCOUNT
2022 2021
$M $M
Total Franking account balance at 30 per cent — —
The above amount represents the balance of the franking account as at 30 June, after taking into account adjustments for:
– Franking credits that will arise from the payment of income tax payable for the current year
– Franking credits that will arise from the receipt of dividends recognised as receivables at the year end
– Franking credits that may be prevented from being distributed in subsequent years.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

11 RECEIVABLES
2022 2021
$M $M
Current Non-Current Total Current Non-Current Total
Trade receivables 989 — 989 489 — 489
Less: provision for impairment losses (1) — (1) (6) — (6)
Total trade receivables 988 — 988 483 — 483
Sundry receivables 114 5 119 96 54 150
Total receivables 1,102 5 1,107 579 54 633

2022 2021
$M $M
1
The ageing of trade receivables, net of provision for expected credit losses at 30 June was:
Not past due 837 386
Past due 1-30 days 84 75
Past due 31-120 days 67 16
Past due 121 days or more — 6
Total trade receivables 988 483
1 The Group assesses at each reporting date whether the carrying value of financial assets is impaired. Where necessary, a provision for expected credit losses (ECL) is recognised,
depending on whether there has been a significant increase in credit risk, including risk of default occurring since initial recognition. Refer to Note 38(G) for the Group’s accounting
policy.

12 INVENTORIES
2022 2021
$M $M
Engineering expendables 227 243
Consumables stores 41 36
Work in progress 1 —
Total inventories 269 279

13 ASSETS CLASSIFIED AS HELD FOR SALE

Transferred from Reversal of
2022 Opening Net Book Property, Plant and Impairment/ Closing Net Book
$M Value Equipment Disposals (Impairment) Value
Aircraft and engines 1 — (1) 1 1
Total assets classified as held for sale 1 — (1) 1 1

2021 Transferred from Reversal of

Opening Net Book Property, Plant and Impairment/ Closing Net Book
$M Value Equipment Disposals (Impairment) Value
Aircraft and engines 58 1 (55) (3) 1
Total assets classified as held for sale 58 1 (55) (3) 1

The fair value measurement for property, plant and equipment classified as held for sale has been categorised under the fair value hierarchy
as Level 2. Refer to Note 38(C) for a definition of the fair value hierarchy.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

14 INVESTMENTS ACCOUNTED FOR UNDER THE EQUITY METHOD

1
Ownership interest in investments accounted for under the equity method
June 2022 June 2021
% %
Fiji Resorts Pte Limited 21 21
Hallmark Aviation Services L.P. 49 49
HT & T Travel Philippines, Inc. 28 28
Holiday Tours and Travel (Thailand) Ltd. 37 37
Holiday Tours and Travel Vietnam Co. Ltd. 37 37
Holiday Tours and Travel (GSA) Ltd. 37 37
Helloworld Travel Limited 12 12
Jetstar Japan Co. Ltd. 33 33
Pacific Airlines Aviation Joint Stock Company2 — 30
PT Holidays Tours & Travel 37 37
1 Based on voting rights.
2 Jetstar Pacific Airline Aviation Joint Stock Company has been renamed Pacific Airlines Joint Stock Company. The Group has discontinued equity accounting for its interest and the
investment was recognised as Held for Sale until its disposal during the 2021/22 financial year.
2022 2021
Notes $M $M
Balance as at 1 July 57 59
Cash additions 66 48
Non-cash additions 17 18
Dividends received — —
Share of net loss (126) (129)
Share of reserves and other movements 5 14
Transfer to provisions 22 37 48
Reversal of impairment/(impairment)1 25(C) 1 (1)
Balance as at 30 June 57 57
1 The Group recognised a reversal of impairment of $1 million (2021: ($1) million impairment) in relation to its investment in Helloworld Travel Ltd. (ASX: HLO). The reversal of impairment
recognised was determined with reference to the closing share price as at 30 June 2022.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

15 PROPERTY, PLANT AND EQUIPMENT

2022 2021
$M $M
Accumulated Accumulated
Depreciation and Depreciation and
At Cost Impairment Net Book Value At Cost Impairment Net Book Value
Freehold land 9 — 9 49 — 49
Buildings 231 (188) 43 287 (218) 69
Leasehold improvements 1,067 (896) 171 1,112 (910) 202
Plant and equipment 1,251 (982) 269 1,327 (1,035) 292
Aircraft and engines 21,248 (13,282) 7,966 21,705 (12,971) 8,734
Aircraft spare parts 952 (505) 447 891 (458) 433
Aircraft deposits 1,319 — 1,319 1,008 — 1,008
Total property, plant 26,077 (15,853) 10,224 26,379 (15,592) 10,787
and equipment

Transferred
Acquisition (to)/from
2022 Opening of Assets Closing
Net Book Cash Controlled Classified as Net Book
Value Additions1 2 3
$M Entities Disposals Transfers Held for Sale Depreciation Impairment Other Value
Freehold land 49 — 2 (41) — — — — (1) 9
Buildings 69 — 3 (26) — — (3) — — 43
Leasehold improvements 202 20 2 (4) (9) — (33) — (7) 171
Plant and equipment 292 31 — (6) 7 — (53) — (2) 269
Aircraft and engines 8,734 507 — — 1 — (1,212) (35) (29) 7,966
Aircraft spare parts 433 65 — (1) 23 — (44) (3) (26) 447
Aircraft deposits 1,008 288 — — (5) — — — 28 1,319
Total property, plant and 10,787 911 7 (78) 17 — (1,345) (38) (37) 10,224
equipment

Transferred
(to)/from
Acquisition Assets
2021 Opening of Classified Closing
Net Book Cash Controlled as Held for Net Book
Value Additions1 2 3
$M Entities Disposals Transfers Sale Depreciation Impairment Other Value
Freehold land 49 — — — — — — — — 49
Buildings 73 — — — — — (3) — (1) 69
Leasehold improvements 209 20 — — 3 — (36) (1) 7 202
Plant and equipment 394 11 — (21) (25) — (60) (1) (6) 292
Aircraft and engines 9,785 420 — — 26 (1) (1,222) (223) (51) 8,734
Aircraft spare parts 454 31 — — (2) — (35) — (15) 433
Aircraft deposits 762 281 — — (26) — — — (9) 1,008
Total property, plant and 11,726 763 — (21) (24) (1) (1,356) (225) (75) 10,787
equipment
1 Additions includes capitalised interest of $15 million (2021: $17 million).
2 Transfers includes transfers between categories of property, plant and equipment and transfers from/(to) other balance sheet accounts.
3 Other includes non-cash movements, movements in accrued payments for property, plant and equipment (2022: ($4) million, 2021: $46 million),
(A) AIRCRAFT BY GEOGRAPHIC AREA
Aircraft supporting the Group’s global operations are primarily located in Australia, with the exception four A380 aircraft which are currently in
storage overseas awaiting maintenance ahead of return to service.
(B) SECURED ASSETS
Certain aircraft and engines act as security against related financing facilities. Under the terms of certain financing facilities entered into by
the Qantas Group, the underwriters of these agreements have a fixed charge over certain aircraft and engines to the extent that debt has
been issued directly to those underwriters. The total carrying amount of assets under pledge is $4,653 million (2021: $5,980 million).

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Notes to the Financial Statements continued

For the year ended 30 June 2022

15 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

(C) CAPITAL EXPENDITURE COMMITMENTS
The Group’s capital expenditure commitments as at 30 June 2022 are $15,774 million (2021: $8,114 million). The Group has certain rights
within its aircraft purchase contracts which can defer capital expenditure commitments. In May 2022, the Group announced several major
fleet decisions that will reshape its international and domestic networks through ‘Project Sunrise’ (12 Airbus A350-1000s) and ‘Project
Winton’ (20 Airbus A321XLRs and 20 Airbus A220-300s).
The Group’s capital expenditure commitments are predominantly denominated in US dollars. Commitments reported above are translated to
the Group’s Australian dollar presentational currency at the 30 June 2022 closing exchange rate of $0.69 (2021: $0.75).

16 LEASES
(A) RIGHT OF USE ASSETS
2022 2021
$M $M

Accumulated Accumulated
Depreciation and Depreciation and
At Cost Impairment Net Book Value At Cost Impairment Net Book Value
Aircraft 2,634 (2,279) 355 2,581 (2,175) 406
Property 1,636 (1,071) 565 1,583 (951) 632
Other 241 (204) 37 284 (213) 71
Total right of use assets 4,511 (3,554) 957 4,448 (3,339) 1,109

2022 Additions/
Opening Net Modification/ Closing Net
$M Book value Remeasurements Transfers1 Depreciation Other2 Book value
Aircraft 406 88 — (147) 8 355
Property 632 73 (3) (137) — 565
Other 71 41 (3) (52) (20) 37
Total right of use assets 1,109 202 (6) (336) (12) 957

2021 Additions/
Opening Net Modification/ Closing Net
$M Book value Remeasurements Transfers1 Depreciation Other2 Book value
Aircraft 610 8 3 (186) (29) 406
Property 682 113 (1) (129) (33) 632
Other 148 9 (28) (58) — 71
Total right of use assets 1,440 130 (26) (373) (62) 1,109
1 Transfers includes transfers from/(to) lease receivables where the Group is a sub-lessor.
2 Other movements include early terminations of ($21 million) (2021: ($37 million)), impairment of aircraft right of use assets recognised within the Jetstar Asia CGU of nil (2021:($20
million)), foreign exchange movements and changes in the measurement of make good assets.
(B) LEASE RECEIVABLES
2022 2021
$M $M
Current Non-Current Total Current Non-Current Total
Finance lease receivable1 9 45 54 5 47 52
Total 9 45 54 5 47 52
1 The Group has subleased property, plant and equipment and aircraft and classified the subleases as finance leases. The subleased portion of the right of use asset was derecognised
and the Group recognised a finance lease receivable (net investment in the finance lease). The interest income recognised on the net investment in the finance lease was $2 million
(2021: $2 million).
(C) LEASE LIABILITIES
2022 2021
$M $M
Current Non-Current Total Current Non-Current Total
Aircraft 197 178 375 175 296 471
Property 163 674 837 154 679 833
Other 24 36 60 54 41 95
Total lease liabilities 384 888 1,272 383 1,016 1,399

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Notes to the Financial Statements continued

For the year ended 30 June 2022

16 LEASES (CONTINUED)
(C) LEASE LIABILITIES (CONTINUED)

2022 Additions/
Opening Modification/ Lease1 Foreign 2
$M Balance Remeasurements Repayments Interest Exchange Other Closing Balance
Aircraft 471 53 (196) 16 31 — 375
Property 833 118 (171) 54 4 (1) 837
Other 95 41 (62) 3 4 (21) 60
Total lease liabilities 1,399 212 (429) 73 39 (22) 1,272

2021 Additions/
Opening Modification/ Lease Foreign
$M Balance Remeasurements Repayments1 Interest Exchange Other2 Closing Balance
Aircraft 773 8 (273) 22 (59) — 471
Property 903 113 (145) 50 (9) (79) 833
Other 166 9 (75) 3 (8) — 95
Total lease liabilities 1,842 130 (493) 75 (76) (79) 1,399
1 Lease repayments of $429 million includes $363 million principal repayments and $66 million interest repayments. The lease repayments in financial year 2021/22 include deferred
lease repayments of $7 million from financial year 2020/21 (2021: Lease repayments of $493 million includes $420 million principal repayments and $73 million interest repayments.
The lease repayments include deferred lease repayments of $49 million from financial year2019/2020).
2 Other movements include rental waivers of $1 million (2021: $31 million) and early terminations of $22 million (2021: $39 million).
(D) RECOGNISED WITHIN OTHER EXPENSES IN THE CONSOLIDATED INCOME STATEMENT
2022 2021
$M $M
Lease expense for short-term leases 1 —
Variable lease expenses not included in lease liabilities1 23 2
Rental waivers 1 31
1 Recognised in other expenditure.
(E) SALE AND LEASEBACK
The Mascot land sale transaction included the leaseback of certain areas of land and buildings for between two to ten years with options. The
net gain on sale of $686 million arising from the sale is net of the difference between the right of use asset and lease liability recognised to
account for the portion of the asset that is retained by the Group. The Group recognised investing cash inflows of $789 million from the
transaction during the 2021/22 financial year.

17 INTANGIBLE ASSETS
2022 2021 (restated)
$M $M
Accumulated Accumulated
Depreciation and Depreciation and
At Cost Impairment Net Book Value At Cost Impairment Net Book Value
Goodwill 270 — 270 166 — 166
Airport landing slots 35 — 35 35 — 35
Software 1,523 (1,260) 263 1,521 (1,145) 376
Brand names and trademarks 41 (1) 40 1 — 1
Customer contracts/relationships 11 (4) 7 4 (4) —
Contract intangible assets 171 (8) 163 171 (4) 167
Total intangible assets 2,051 (1,273) 778 1,898 (1,153) 745

Acquisition
2022 of
Opening Net Cash Controlled1 Closing Net
$M Book Value Additions Entities Transfers Amortisation Impairment Other Book Value
Goodwill 166 — 104 — — — — 270
Airport landing slots 35 — — — — — — 35
Software 376 — 2 — (115) — — 263
Brand names and trademarks 1 — 40 — (1) — — 40
Customer contracts/relationships — — 7 — — — — 7
Contract intangible assets 167 — — — (4) — — 163
Total intangible assets 745 — 153 — (120) — — 778
1 The fair value of the assets acquired have been measured provisionally pending completion of an independent valuation, refer to Note 35.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

17 INTANGIBLE ASSETS (CONTINUED)

Acquisition
2021 (restated) of
Opening Net Cash Controlled Closing Net
$M Book Value Additions1 Entities Transfers2 Amortisation Impairment Other Book Value
Goodwill 162 — 4 — — — — 166
Airport landing slots 35 — — — — — — 35
Software 529 14 — 1 (144) (22) (2) 376
Brand names and trademarks 1 — — — — — — 1
Customer contracts/relationships — — — — — — — —
Contract intangible assets 167 3 — — (4) — 1 167
Total intangible assets 894 17 4 1 (148) (22) (1) 745
1 Financial year 2020/21 additions include capitalised interest of $4 million.
2 Transfers includes those between categories of intangible assets and transfers from/(to) other balance sheet accounts.

18 DEFERRED TAX ASSETS

2021
2022 (restated)
$M $M
Deferred tax assets 853 706

(A) RECONCILIATION OF DEFERRED TAX ASSETS

Recognised
Opening Recognised in the in Other
2022 Balance Consolidated Income Comprehensive Closing
$M (restated) Statement Income Other Balance
Receivables (127) 13 — — (114)
Inventories (12) (1) — — (13)
Investments accounted for under the equity method (2) 1 — — (1)
Property, plant and equipment and intangible assets (1,356) 35 — (12)1 (1,333)
Right of use assets (356) 51 — — (305)
Payables 23 (12) — — 11
Revenue received in advance 943 28 — — 971
Interest-bearing liabilities (131) 12 — — (119)
Lease liabilities 419 (38) — — 381
Other financial assets/(liabilities) (173) (18) (86) — (277)
Provisions 548 12 — 560
Other items 37 28 (87) (1) (23)
Tax value of prepaid tax instalments 136 — — — 136
Tax value of recognised tax losses 757 222 — — 979
Total deferred tax assets 706 333 (173) (13) 853
1 A deferred tax liability of ($12) million referable to the acquisition of TAD Holdco Pty Limited and its subsidiaries (TripADeal).

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Notes to the Financial Statements continued

For the year ended 30 June 2022

18 DEFERRED TAX ASSETS (CONTINUED)

(A) RECONCILIATION OF DEFERRED TAX ASSETS (CONTINUED)

Recognised
Opening Recognised in the in Other
2021 Balance Consolidated Income Comprehensive Closing
$M (restated) Statement Income Other Balance
Receivables (58) (69) — — (127)
Inventories (13) 1 — — (12)
Investments accounted for under the equity method (3) 1 — — (2)
Property, plant and equipment and intangible assets (1,269) (87) — — (1,356)
Right of use assets (422) 66 — — (356)
Payables 34 (11) — — 23
Revenue received in advance 865 78 — — 943
Interest-bearing liabilities (127) (4) — — (131)
Lease liabilities 542 (123) — — 419
Other financial assets/(liabilities) (41) 16 (148) — (173)
Provisions 622 (78) — 41 548
Other items (2) 145 (108) 22 37
Tax value of prepaid tax instalments — — 136 136
Tax value of recognised tax losses 86 671 — — 757
Total deferred tax assets 214 606 (256) 142 706
1 A deferred tax asset of $4 million referable to acquisition of National Jet Systems Pty Ltd and National Jet Operations Services Pty Ltd.
2 A deferred tax asset of $4 million referable to a timing difference associated with deductible expenditure for capital raising and a decrease in deferred tax asset of ($2) million relating
to share-based payments recognised in retained earnings.
(B) QANTAS GROUP CARRIED FORWARD TAX LOSSES
2022 2021
$M $M
Tax losses available to be utilised in current year (757) (86)
Total tax losses brought forward (757) (86)
Tax losses recognised1 (222) (671)
Tax losses carried forward to be utilised in future years2 (979) (757)
1 Australian tax losses recognised for the year ending 30 June 2022 of ($222) million (at the 30 per cent tax rate) is net of the taxable gain on sale of Mascot land and buildings.
2 A deferred tax asset of $979 million has been recognised for income tax losses and is expected to be recovered in future periods.
(C) UNRECOGNISED DEFERRED TAX ASSETS
Deferred tax assets have not been recognised with respect to the following items:
2022 2021
$M $M
Tax losses – New Zealand 44 30
Tax losses – Singapore 54 46
Tax losses – Hong Kong 21 11
Tax losses – Capital losses — 2
Total unrecognised deferred tax assets 119 89

19 OTHER ASSETS
2022 2021
$M $M
Note Current Non-Current Total Current Non-Current Total
Prepayments 206 196 402 99 238 337
Net defined benefit asset 30(B) — 539 539 — 317 317
Other assets1 62 167 229 70 132 202
Total 268 902 1,170 169 687 856
1 Other assets include incremental costs of obtaining a contract. Refer to Note 38(D)vii. for the Group’s accounting policy.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

20 REVENUE RECEIVED IN ADVANCE

2022 2021
$M $M
Current Non-current Total Current Non-current Total
Unavailed passenger revenue 4,389 — 4,389 2,143 — 2,143
Unredeemed Frequent Flyer revenue 1,168 1,945 3,113 894 2,119 3,013
Other revenue received in advance 306 121 427 240 35 275
Total revenue received in advance 5,863 2,066 7,929 3,277 2,154 5,431
Unavailed passenger revenue relates to sales to passengers in advance of the date of passenger travel. The balance includes tickets relating
to travel with a travel date subsequent to year end and tickets which have been transferred to a travel credit as a result of flight cancellations
from border closures and other restrictions due to the impact of COVID-19.
Tickets generally expire either within 12 months after the planned travel date if they are not used within that time period, or on the date of
planned travel, depending on the terms and conditions. At the time of travel, revenue is also recognised in respect of tickets that are not
expected to be used. Unused tickets are recognised as revenue using estimates based on the terms and conditions of the ticket, experience,
historical and expected future trends.
Travel credits are available to be used for future flights and are typically eligible for refund. Where customers have made refund claims by
30 June 2022, these are no longer classified as unavailed passenger revenue and are reported as payables in the Consolidated Balance
Sheet. Notwithstanding that travel credits may not be utilised in the next 12 months, unavailed passenger revenue is classified as current on
the basis that the Group does not have an unconditional right to defer usage of the ticket for at least 12 months.
Unredeemed Frequent Flyer revenue relates to performance obligations associated with Qantas Points which have been issued but not
redeemed. Qantas Points are issued by the Group as part of the Qantas Frequent Flyer program or are sold to third parties such as credit cards
providers, who issue them as part of their loyalty programs. Unredeemed Frequent Flyer revenue is classified as either current or non-current
based on the Group’s expectation of redemption patterns by members within the next 12 months under the Financial Plan. The non-current
amount of Unredeemed Frequent Flyer revenue will be materially recognised as revenue over three years. Significant changes in Qantas
Points expected to expire unredeemed are recognised within other revenue and income using estimates based on the terms and conditions of
the Frequent Flyer program, experience, historical and expected future trends.
Other revenue received in advance primarily relates to prepaid Qantas Club membership fees, revenue received in advance for travel
packages, revenue collected on behalf of other airlines, unavailed cargo revenue and grants or supplier incentives the Group has received but
which are recognised over time. Other revenue is classified as current where it is expected to be recognised or transferred to another carrier
within the next 12 months.

21 NET ON BALANCE SHEET DEBT

(A) CASH AND CASH EQUIVALENTS
2022 2021
$M $M
Cash balances 254 143
Cash at call 302 327
Short-term money market securities and term deposits 2,787 1,751
Total cash and cash equivalents 3,343 2,221
Cash and cash equivalents comprise cash at bank and cash on hand, cash at call and short-term money market securities and term deposits
that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
Short-term money market securities of $201 million (2021: $250 million) held by the Qantas Group are pledged as collateral under the terms
of certain operational financing facilities when underlying unsecured limits are exceeded.The collateral cannot be sold or repledged in the
absence of default by the Qantas Group.
(B) INTEREST-BEARING LIABILITIES
2022 2021
$M $M
Current Non-current Total Current Non-current Total
Bank loans – secured 308 1,321 1,629 433 1,628 2,061
Bank loans – unsecured — 438 438 — 436 436
Other loans – secured 361 1,566 1,927 241 2,328 2,569
Other loans – unsecured — 1,966 1,966 295 1,469 1,764
Total interest-bearing liabilities 669 5,291 5,960 969 5,861 6,830
Certain current and non-current interest-bearing liabilities relate to specific financing of aircraft and engines and are secured by the aircraft
to which they relate (refer to Note 15(B)).

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Notes to the Financial Statements continued

For the year ended 30 June 2022

21 NET ON BALANCE SHEET DEBT (CONTINUED)

(C) UNDRAWN FACILITIES
At 30 June 2022, the Group has an undrawn Revolving Credit Facility of $1,330 million (2021: $1,575 million).
(D) ANALYSIS OF CHANGES IN NET ON BALANCE SHEET DEBT
Foreign
Exchange, Mark-
2022 to-Market and Other
Opening Debt Debt Non-Cash Shareholder Treasury Equity Net Cash Closing
$M Balance Repayment Drawdown Movements Distributions Shares Raising Movement Balance
Interest-bearing
6,830 (1,441) 491 80 — — — — 5,960
liabilities
Cash (2,221) 1,441 (491) (2) — 2 — (2,072) (3,343)
Net on balance 4,609 — — 78 — 2 — (2,072) 2,617
sheet debt

Foreign
Exchange, Mark-
to-Market and Other
2021 Opening Debt Debt Non-Cash Shareholder Treasury Equity Net Cash Closing
$M Balance Repayment Drawdown Movements Distributions Shares Raising Movement Balance
Interest-bearing 6,693 (759) 937 (41) — — — — 6,830
liabilities
Cash (3,520) 759 (937) 10 — — (58) 1,525 (2,221)
Net on balance 3,173 — — (31) — — (58) 1,525 4,609
sheet debt

22 PROVISIONS
2022 2021
$M $M
Current Non-current Total Current Non-current Total
Annual leave 358 — 358 375 — 375
Long service leave 303 38 341 340 50 390
Redundancies and other employee benefits1 189 — 189 123 — 123
Total employee benefits 850 38 888 838 50 888
Onerous contracts 12 — 12 31 — 31
Make good on leased assets 50 641 691 131 523 654
Insurance, legal and other 189 115 304 136 116 252
Total other provisions 251 756 1,007 298 639 937
Total provisions 1,101 794 1,895 1,136 689 1,825
1 Redundancies and other employee benefits includes the recognition of a provision for the Recovery Boost bonus for EBA-covered employees announced in June 2022.

Reconciliations of the movements of each class of provision, other than employee benefits, are set out below:

2022 Transfers from

Opening Provisions Provisions Unwind of Discount Rate Investments in Closing
$M Balance Made Utilised Discount Changes Associates Other Balance
Onerous contracts 31 — (19) — — — — 12
Make good on leased assets 654 148 (107) 17 (70) — 49 691
Insurance, legal and other 252 78 (56) — (14) 37 7 304
Total other provisions 937 226 (182) 17 (84) 37 56 1,007

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Notes to the Financial Statements continued

For the year ended 30 June 2022

23 CAPITAL
(A) ISSUED CAPITAL
2022 2021
$M $M
Opening balance: 1,886,044,698 (June 2021: 1,863,491,352) ordinary shares, fully paid 3,186 3,104
Capital raising: nil (June 2021: 22,553,346) ordinary shares — 82
Closing balance: 1,886,044,698 (2021: 1,886,044,698) ordinary shares 3,186 3,186
On 10 August 2020, the Group completed a retail Share Purchase Plan resulting in the issuance of 22.6 million shares at $3.18 per share
totalling $71.7 million. Equity raising costs were accrued against the capital raising as at June 2020 as a reduction in Issued Capital. The tax
benefit of these costs was recognised in equity in the year ended 30 June 2021, resulting in an increase in Issued Capital of $10 million. The
fully underwritten Institutional Placement in June 2020 and the Share Purchase Plan in July 2020 provided total proceeds of $1,432 million,
resulting in an increase in Issued Capital of $1,410 million, net of tax and fees.
Holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at
shareholders’ meetings. In the event of wind-up, Qantas ordinary shareholders rank after all creditors and are fully entitled to any residual
proceeds on liquidation.
(B) TREASURY SHARES
Treasury shares consist of shares held in trust for Qantas employees in relation to equity compensation plans. As at 30 June 2022, 1,602,255
(2021: 3,099,413) shares were held in trust and classified as treasury shares.
(C) CAPITAL MANAGEMENT
The Qantas Group’s Financial Framework is designed to achieve top quartile Total Shareholder Return relative to the ASX100 and global airline
peers. The Framework’s key elements are to:
– Maintain an optimal capital structure that minimises the cost of capital by holding an appropriate level of Net Debt. The appropriate level of
Net Debt reflects the Qantas Group’s size, measured by Invested Capital. This is consistent with investment grade credit metrics
– Deliver ROIC that exceeds the weighted average cost of capital through the cycle
– Make disciplined capital allocation decisions between reinvestment, debt reduction and distribution of surplus capital to shareholders
while maintaining an optimal capital structure.
Surplus capital is determined on a forward-looking basis, which is the difference between the projected Net Debt position and the target Net
Debt position.
The Qantas Group maintains access to a broad range of debt markets, both secured and unsecured. The Qantas Group maintains a prudent
liquidity policy that ensures adequate coverage of liquidity requirements while considering a range of adverse scenarios.
2021
Metrics 2022 (restated)
Net Debt1 $4.2B to $5.2B2 $3.94B $5.9B
Return on Invested Capital (%) ROIC > WACC (31.6) per cent (21.4) per cent
Net capital expenditure3 $398M $693M
Shareholder distributions — —
1 Net Debt is a non-statutory measure. It includes on-balance sheet debt and capitalised aircraft lease liabilities under the Group’s Financial Framework. Capitalised aircraft lease
liabilities are measured at fair value at the lease commencement date and remeasured over the lease term on a principal and interest basis. The residual value of the capitalised
aircraft lease liability denominated in a foreign currency is translated at the long-term exchange rate.
2 Target Net Debt range of $4.2 billion to $5.2 billion is based on the 12-month average Invested Capital of $4.9 billion as at 30 June 2022. During the recovery phase, the Target Net
Debt range for 2021 was held at $4.5 billion to $5.6 billion, which is based on the Invested Capital of approximately $6 billion as at 30 June 2020.
3 Net capital expenditure is a non-statutory measure which is equal to net investing cash outflows included in the Consolidated Cash Flow Statement of $240 million (2021:
$722 million) and the impact to Invested Capital from the acquisitions/disposals of leased aircraft and conversion of a leased aircraft to a freighter of $158 million (2021: Return/
disposal of leased aircraft ($29 million). For the year ended 30 June 2022, net capital expenditure includes the impact of capitalised aircraft leases relating to Embraer E190s and
Boeing 747 freighters in the Group’s Financial Framework.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

24 GOVERNMENT GRANTS AND ASSISTANCE

To mitigate the impact of COVID-19, governments provided businesses, and specifically the aviation sector, various support packages in the
form of rebates and other financial assistance. The Group has recognised government grants and assistance where there is reasonable
assurance that the Group will comply with the associated conditions and the grants/assistance will be received. A summary of the material
government grants recognised in the Consolidated Income Statement during the financial year 2021/22 is below:
1
Packages Description
International Aviation The program provided support to maintain a core Australian international aviation workforce and operational
2
Support (IAS) Package capability to ensure airlines could quickly restart commercial international flights once international
Recognised within other restrictions were lifted. Announced on 11 March 2021, the IAS program was originally due to run between 1
revenue and income April 2021 and 31 October 2021. On 20 September 2021, the government announced an extension to the
program which ended on 31 March 2022. The funding covered employee support and retention payments to
maintain international workforce capability, training to ensure international workers maintain their skills and
currency, maintenance and costs associated with bringing international aircraft out of long-term storage, and
port readiness costs.

Income of $129 million was recognised in the Consolidated Income Statement during the period. The costs to
awaken aircraft and the training of the international workforce was recognised primarily in manpower and
staff-related costs, aircraft operating variable, fuel and other expenses.

Further to the payments made in relation to international readiness, the IAS package also provided $59 million
of employee retention payments which were wholly passed through to impacted employees and the Group
received no benefit.
Retaining Domestic Airline The program assisted airlines to maintain core domestic aviation capabilities, through the retention of
2
Capability (RDAC) Program essential aviation sector skills and knowledge to ensure airlines could quickly increase capacity as border
Recognised within other restrictions eased. Announced on 2 August 2021, the RDAC program was originally due to run between
revenue and income 2 August 2021 and 31 December 2021. Following the removal of all COVID-19 Commonwealth hotspots, the
program ended on 1 December 2021. The funding covered employee support and retention payments for those
who were not eligible for the Commonwealth Disaster Payment to maintain an agreed level of domestic
capability, training to ensure domestic workers maintain their skills and currency and maintenance costs
associated with ensuring aircraft are in flight-ready condition.

Income of $31 million was recognised in the Consolidated Income Statement. The costs to maintain aircraft
and the training of the domestic workforce was recognised primarily in manpower and staff-related costs,
aircraft operating variable and other expenses.

Further to the payments made in relation to domestic readiness, the RDAC program also provided $8 million of
employee support payments which were wholly passed through to impacted employees and the Group
received no benefit.
Tourism Aviation Network This program reduced the cost of flying for consumers by discounting ticket prices to certain regions through
Support (TANS) half price airfares. Discounts were offered on a selected number of routes across key tourism regions, with the
Tourism aviation discount original sale period between 1 April 2021 and 31 July 2021 for travel by 30 September 2021. On 2 August 2021,
fares (Part 1) the travel and sale period for the TANS program was extended until 30 November 2021. On 30 November 2021,
the program was further extended and ended on the 28 February 2022.
Recognised within other
revenue and income Income of $27 million was recognised in the Consolidated Income Statement. The costs to operate these
flights were recognised primarily in manpower and staff-related costs, aircraft operating variable, fuel,
depreciation and amortisation and other expenses.

1 The Domestic Airport Security Cost Support (DASCS) program provided funding to meet eligible costs related to mandatory security screening obligations under the Aviation Transport
Security Regulations 2005 between 29 March 2021 and 30 September 2021 for Qantas’ operations at Melbourne Terminal 1. On 2 August 2021, the Australian Government announced
the DASCS program would be extended and it ended on 31 December 2021. The Airservices Fee Waiver provides a 50 per cent reduction in charges, including charges by the Bureau of
Meteorology, for regular public transport (RPT) and aeromedical services. The waiver was extended to 31 December 2021 and lessened the operating costs for airlines in providing RPT
and aeromedical flights. In addition, the International Airports Security Costs Rebate (IASCR) program assisted eligible airports to maintain regulated security obligations for
international flights. As a result of the aforementioned support, the providers have granted waivers to the Group of $68 million and the Group directly received $2 million from the
DASCS program for the 2021/22 financial year.
2 A portion of the underlying funding is to support capital expenditure relating to IAS $35 million and RDAC $19 million. These amounts have been deferred and will be recognised in the
Consolidated Income Statement over the useful life, with $3 million recognised in the Consolidated Income Statement in the 2021/22 financial year.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

24 GOVERNMENT GRANTS AND ASSISTANCE (CONTINUED)

In addition to the above, the government also contracted Qantas to provide passenger and freight services as part of the overall Australian
Government COVID-19 recovery strategy. A summary of the material government grants recognised in the Consolidated Income Statement
during financial year 2021/22 is below:

Packages Description
Tourism Aviation Network This program increased the number of flight frequencies above minimum connectivity to selected regions
Support (TANS) which had been heavily impacted by the loss of international tourists. The program ended on 30 September
TANS — Tourism aviation 2021.
capacity (Part 2)
Income of $10 million was recognised in the Consolidated Income Statement. The costs to operate these
Recognised within other flights were recognised primarily in manpower and staff-related costs, aircraft operating variable, fuel,
revenue and income depreciation and amortisation and other expenses.
RANS, DANS and This package was underwritten by the Australian Government on a cost offset basis. The Group operated a
government repatriation series of domestic and regional flights on behalf of the Australian Government to maintain critical links
flights otherwise impacted by COVID-related travel restrictions. It included a baseline network of domestic passenger
RANS/DANS recognised flights servicing the most critical metropolitan and regional routes while providing freight belly space
within other revenue and capacity. In addition, the Australian Government commissioned Qantas to conduct various charter
income repatriation flights.
Government repatriation The Regional Airline Network Support (RANS), Domestic Aviation Network Support (DANS) and government
flights recognised within net repatriation flights were operated as a fee-for-service, with fare revenue offsetting the cost. Income of $163
passenger revenue million was recognised in the Consolidated Income Statement. The costs to operate these flights were
recognised primarily in manpower and staff-related costs, aircraft operating variable, fuel, depreciation and
amortisation and other expenses. On 2 August 2021, the government announced the extension of the DANS
and RANS programs until 31 December 2021. On 20 December 2021, the government announced an extension
to the RANS program which ended on 31 March 2022.
International Freight This mechanism restored critical global supply chains which have been heavily impacted by COVID-19
Assistance Mechanism containment measures around the world to ensure exporters maintained connectivity to strategic markets. On
(IFAM) 11 March 2021, the government announced an extension of the program to the end of September 2021. On 27
Recognised within net August 2021, a further extension was announced which ended on 30 June 2022.
freight revenue
Income of $320 million was recognised in the Consolidated Income Statement. The costs to operate these
flights were recognised primarily in manpower and staff-related costs, aircraft operating variable, fuel,
depreciation and amortisation and other expenses.

25 IMPAIRMENT OF ASSETS AND RELATED COSTS

(A) IMPAIRMENT TESTING OF CASH GENERATING UNITS
i. Identification of CGUs
The identification of an asset’s CGU is a critical judgement in performing an impairment test. CGUs are the lowest identifiable group of assets
that generate largely independent cash inflows and are determined based on how performance is monitored and how decisions to acquire and
dispose of the Group’s assets and operations are made.
The identified CGUs by operating segment for the 2021/22 financial year are outlined in the table below:

Operating Segment CGUs Identified

Qantas Domestic Qantas Domestic CGU
Qantas International CGU
Qantas International
Qantas Freight CGU
Jetstar Australia/New Zealand CGU
Jetstar Group Jetstar Asia CGU
Jetstar Japan CGU
Qantas Loyalty Qantas Loyalty CGU

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Notes to the Financial Statements continued

For the year ended 30 June 2022

25 IMPAIRMENT OF ASSETS AND RELATED COSTS (CONTINUED)

(A) IMPAIRMENT TESTING OF CASH GENERATING UNITS (CONTINUED)
ii. Impairment Assessment
AASB 136 Impairment of Assets (AASB 136) requires the assessment at the end of each reporting period as to whether there is any indication
that an asset may be impaired. If any such indication exists, the entity shall estimate the recoverable amount of the asset. The recoverable
amount of an asset is the higher of its fair value less costs of disposal and its value in use.
The recoverable amount is determined for an individual asset where possible, otherwise, the recoverable amount of the CGU to which the
asset belongs shall be determined.
Value in use is the present value of the future cash inflows expected to be derived from an asset or CGU.
Fair value less costs of disposal is the price that would be received to sell an asset in an orderly transaction between market participants at
the measurement date, less the incremental costs directly attributed to disposal.
Where the carrying value of the asset exceeds its recoverable amount, the carrying amount of the asset is reduced to its recoverable amount
through the recognition of an impairment loss.

Impairment Assessment of CGUs

The impairment test for CGUs includes the allocation of assets to identified CGUs and the determination of the recoverable amount of the CGU
based on its value in use. Outlined below are the significant assumptions applied in the determination of the recoverable amount.

Significant
Assumption How It Was Determined
Calculation of The recoverable amounts of CGUs were determined based on their value in use. The value in use was determined by
recoverable discounting the future cash flows forecast in the Financial Plan.
amount
Individual Assets that have been tested for impairment individually are not allocated to CGUs. Consistent with the approach taken at
assets tested 30 June 2021, the carrying value of the A380 fleet has been allocated to the Qantas International CGU for impairment
separately testing.
Cash Flows — Cash flows were projected based on the Board-approved Financial Plan. The Financial Plan includes the completion of the
Group Financial Group’s Three-Year Recovery Plan by 30 June 2023 and forecasts for a further two to four years.
Plan (including The Group’s Recovery Plan was developed with reference to expected demand scenarios domestically and internationally
the Recovery and included:
Plan)
– Rightsize the Group’s workforce, fleet and other costs according to demand projections, with the ability to scale-up as
flying returns
– Restructure to deliver ongoing cost savings and efficiencies across the Group’s operations in a changing market
– Recapitalise through the equity raising completed in August 2020 to strengthen the Group’s financial resilience to
recovery and the opportunities it presents.
The long-term annual ongoing restructuring benefit to the Group of the Recovery Plan is estimated to be $1 billion from
financial year 2022/23 onwards.
The Group’s Recovery Plan and the structural changes achieved to date and underway mean the Group is well-positioned
to respond to the changing environment.
By 30 June 2022, the Group delivered $920 million in cumulative annualised structural cost benefits. The Group is on track
to deliver $1 billion in annual cost improvements from the 2022/23 financial year onwards, with all initiatives now
commenced and greater than 90 per cent completed.
Cash outflows include capital and maintenance expenditure for the purchase of aircraft and other property, plant and
equipment. These cash outflows do not include capital expenditure that enhances the current performance of assets and
related cash flows have been treated consistently.
The Group’s Financial Plan incorporates estimates of the future impact on the Group of meeting the interim targets in the
Group’s Climate Action Plan, including the financial impact within cash flow projections of the increased cost of carbon
offsetting and SAF (together with estimated recovery through revenue).
For the purposes of performing an impairment test, the final year of the forecast has been used to determine the terminal
year. Cash flows to determine a terminal value were extrapolated using a constant growth rate of 2.5 per cent per annum,
which does not exceed the long-term average growth rate for the industry.
Given the uncertainty of the impact and timing of COVID-19, the Group has adjusted the cash flow forecast under the
Recovery Plan for these uncertainties rather than adjusting the discount rate.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

25 IMPAIRMENT OF ASSETS AND RELATED COSTS (CONTINUED)

(A) IMPAIRMENT TESTING OF CASH GENERATING UNITS (CONTINUED)
ii. Impairment Assessment (continued)

Significant
Assumption How It Was Determined
Discount rate A pre-tax discount rate of 10 per cent per annum has been used in discounting the projected cash flows of the CGUs,
reflecting a market estimate of the weighted average cost of capital (WACC) of the Qantas Group (2021: 10 per cent per
annum). Given the uncertainty of the impact and timing of COVID-19, the Group has adjusted the cash flows under the
Recovery Plan for these uncertainties rather than adjusting the discount rate.
Foreign AUD/USD: 0.69 (2021: 0.75)
exchange rate
used
Sensitivity to Pre-COVID, the Group reported ROIC in excess of the Group’s Weighted Average Cost of Capital. For example, the 12-month
significant ROIC as at 31 December 2019 was 19.6 per cent, and as at 30 June 2019 was 19.2 per cent, compared to the Group’s WACC
changes in of 10 per cent. This, combined with an assessment of other factors under AASB 136, evidenced that pre-COVID there were
assumptions no indicators of impairment of the Group’s CGUs.
Sensitivity to Changes in Cash Flows (CGUs other than Jetstar CGUs in Asia)
The terminal year in the impairment test has the most material impact on the determination of the recoverable amount
and of the surplus between the recoverable amount and carrying value of CGUs. The earlier years in the Financial Plan,
while impacting the measurement of the recoverable amount, do not materially impact the surplus identified.
Reasonably possible changes in the short term to the timing of domestic and international recovery are unlikely to result in
impairment of the CGUs, assuming that the overall recovery expectations remain. The terminal value cash flow is in excess
of the break-even cash flow and reasonably possible changes in this assumption do not result in impairment.
Sensitivity to Changes in Cash Flows (Jetstar CGUs in Asia)
The Group recognised impairment in the Jetstar Asia CGU of Goodwill and indefinite lived intangible assets in the 2019/20
financial year and of property, plant and equipment and right of use assets in the 2020/21 financial year. The impairments
were allocated to individual assets to the extent that the assets were not reduced below their individual fair value less
costs of disposal.
Reasonably possible changes in forecast cash flows would further reduce the estimated recoverable amount of the CGU.
Goodwill and indefinite lived intangible assets have been fully impaired, and property, plant and equipment and right of use
assets have been impaired to individual fair value less costs of disposal. AASB 136 requires that any allocation of CGU
impairment should not reduce the asset below its individual fair value less costs of disposal. As a result, any additional
impairment would only be recognised if there was a reduction in the individual fair value less costs of disposal of the
individual assets.
The fair value less costs of disposal could change depending on valuations provided by two external and independent
aircraft valuers (AVAC and AVITAS), changes in AUD/USD exchange rates, or changes in the level of maintenance life
remaining on the aircraft other than already accounted for through depreciation.
The carrying value of the Jetstar Japan CGU at 30 June 2022 is nil.

The Group has assessed each CGU to determine whether there is any indication that the CGU may be impaired.
CGUs other than Jetstar Asia CGU
No impairment was recognised within the Qantas Domestic, Qantas International, Qantas Loyalty, Qantas Freight, Jetstar Australia/New
Zealand and Jetstar Japan CGUs during the year ended 30 June 2022.
The Qantas International CGU includes the carrying value of the A380 fleet, including spares of $329 million as at 30 June 2022, which had
previously been partially impaired. As the Qantas International CGU test reports a surplus, the Group has assessed whether there is an
indicator of impairment reversal. Impairment reversal may be required where the individual asset’s fair values less costs of disposal are
significantly above their impaired carrying amounts.The fair value less costs of disposal of the A380 fleet was estimated with reference to
valuations provided by two external and independent aircraft valuers (AVAC and AVITAS) and translated at 30 June 2022 AUD/USD exchange
rates.
Jetstar Asia CGU
An impairment test of the Jetstar Asia CGU was undertaken as at 30 June 2022 using updated cash flow projections to calculate the updated
recoverable amount. The recoverable amount determined was below the carrying amount of the Jetstar Asia CGU providing an indicator of
impairment.
Further impairment is only recognised to the extent that individual asset fair values less costs of disposal are significantly below their
carrying amounts. The fair value less costs of disposal was estimated based on valuations provided by two external and independent aircraft
valuers (AVAC and AVITAS) and translated at 30 June 2022 into AUD/USD exchange rates.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

25 IMPAIRMENT OF ASSETS AND RELATED COSTS (CONTINUED)

(B) CARRYING VALUE OF GOODWILL AND INDEFINITE LIVED INTANGIBLE ASSETS
The following CGUs have goodwill and other intangible assets with indefinite useful lives as follows:
2022 2021
$M $M
Goodwill
Qantas Domestic 14 14
Qantas Loyalty1 116 12
Qantas Freight 49 49
Jetstar Australia and New Zealand 91 91
Total goodwill 270 166
Other intangible assets with indefinite useful lives
Qantas Loyalty1 47 —
Qantas International 35 35
Jetstar Australia and New Zealand — 1
Total other intangible assets with indefinite useful lives 82 36
1 Goodwill and other intangible assets with indefinite useful lives allocated to Qantas Loyalty increased by $104 million and $47 million respectively due to the acquisition of TAD
Holdco Pty Limited (TripADeal) on 31 May 2022. The fair value of the assets acquired have been measured provisionally pending completion of an independent valuation, refer to Note
35.
(C) RESULTS OF THE GROUP’S IMPAIRMENT TEST
i. CGU Impairments

CGUs other than Jetstar Asia CGU

No impairment was recognised within the Qantas Domestic, Qantas International, Qantas Loyalty, Qantas Freight, Jetstar Australia/New
Zealand and Jetstar Japan CGUs during the year ended 30 June 2022 (2021: nil).
No impairment reversal was recognised within the Qantas International CGU in relation to previously impaired A380 aircraft.
Jetstar Asia CGU
No further impairment was recognised within the Jetstar Asia CGU as the fair values less costs of disposal of the individual assets were not
significantly different to their carrying amounts as at 30 June 2022 (2021: $73 million).
ii. Other Impairments and/or Reversals of Impairment

Investments accounted for under the equity method

The Group recognised a net reversal of impairment of ($1) million (2021: impairment of $1 million) in relation to its investment in Helloworld
Travel Ltd (ASX: HLO). The impairment recognised was determined with reference to the share price as at 30 June 2022.
Assets classified as Held for Sale
The Group recognised impairment of $38 million in relation to aircraft on transfer to Assets Held for Sale at 30 June 2022. This impairment
primarily related to the Group’s B717 fleet which are being retired as part of the domestic fleet replacement strategy.
iii. Summary of Impairments and Liabilities Recognised
2022 2021
$M $M
Impairment of individual assets
Impairment of aircraft on transfer to held for sale 38 —
Impairment of A380s and onerous contractual commitments relating to A380s — 155
(Reversal of impairment)/Impairment of 747s held for sale (1) 3
(Reversal of impairment)/Impairment of software intangibles and onerous contractual commitments (1) 33
Impairment of property, plant and equipment and recognition of exit costs — 7
Total impairment of individual assets 36 198
CGU impairment
Impairment of Jetstar Asia CGU — 73
Total CGU impairment — 73
Other (reversal of impairment)/impairment
(Reversal of impairment)/impairment of investment in Helloworld (1) 1
Impairment of investment in Pacific Airlines — 10
Other assets — (12)
Total other reversal of impairment (1) (1)
Total impairment of assets and related costs 35 270

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Notes to the Financial Statements continued

For the year ended 30 June 2022

26 SHARE-BASED PAYMENTS
The Group provides benefits to Executives of the Group in the form of share-based payments, whereby Executives render services in
exchange for Rights over shares. Additionally, the Recovery Retention Plan was announced in the second half of the 2021/22 financial year
and includes share-based payments to eligible employees (both non-executive and executive). The total equity-settled share-based payment
expense for the year was $63 million (2021: $19 million). Further details regarding the operation of equity plans are outlined in the
Remuneration Report from pages 34 to 62.
(A) LONG TERM INCENTIVE PLAN (LTIP)
Generally, participation in the LTIP is limited to Senior Executives of the Qantas Group in key roles or other participants who have been
identified as high potential Executives. All Rights are redeemable on a one-for-one basis for Qantas shares, subject to the achievement of
performance hurdles. Dividends are not payable on the Rights. For more information on the operation of the LTIP, see pages 50 to 52.
2022 2021
Number of Number of
Performance Rights Reconciliation Rights Rights
Rights outstanding as at 1 July 16,568,569 9,607,136
Rights granted during the year 4,250,500 12,123,500
Rights forfeited during the year (871,097) (2,879,567)
Rights exercised during the year (827,568) (1,134,203)
Rights lapsed during the year (857,432) (1,148,297)
Rights outstanding as at 30 June 18,262,972 16,568,569
Rights exercisable as at 30 June — —
The Rights outstanding as at 30 June 2022 included 3,035,834 Rights under the 2020-2022 LTIP. 1,143,343 Rights vested and converted to
shares and 1,149,491 Rights lapsed following the testing of performance hurdles as at 30 June 2022 and after applying service conditions
and the Board’s approval of the 2020-2022 LTIP vesting outcome on 24 August 2022. The shares awarded to Executive Management upon
vesting of the LTIP remain subject to an additional one year trading restriction. As noted in the Remuneration Report on page 36, the Board
has agreed with the CEO to defer the decision as to whether his Rights under the 2020-2022 LTIP will be forfeited or allowed to convert
to shares until at least August 2023. Therefore, 743,000 Rights under the 2020-2022 LTIP remain unvested.
The Rights outstanding as at 30 June 2021 included 2,387,000 Rights under the 2019-2021 LTIP. 51,000 Rights were forfeited, 827,568 Rights
vested and converted to shares and 857,432 Rights lapsed following the testing of performance hurdles as at 30 June 2021 and after
applying service conditions and the Board’s approval of the 2019-2021 LTIP vesting outcome on 25 August 2021. As noted in the
Remuneration Report on page 36, the Board has agreed with the CEO to defer the decision as to whether his Rights under the 2019-2021 LTIP
and 2018-2020 LTIP will be forfeited or allowed to convert to shares until at least August 2023. Therefore 651,000 Rights under the
2019-2021 LTIP and 687,000 Rights under the 2018-2020 LTIP remain unvested.
In addition, as at 30 June 2021, 301,284 Rights were outstanding relating to the 2019-2021 LTIP, which were to be settled in cash. 150,642
Rights vested and were settled in cash and 150,642 Rights lapsed following the testing of performance hurdles as at 30 June 2021 and the
Board’s approval of the 2019-2021 LTIP vesting outcome on 25 August 2021. Following this there are no remaining outstanding Rights which
will be cash settled.
i. Fair Value Calculation
The estimated value of Rights granted was determined at grant date using a Monte Carlo model. The weighted average fair value of Rights
granted during the year was $3.89 (2021: $2.33).
2022 2021
Inputs into the Models 17 September 2021 5 November 2021 11 September 2020 23 October 2020
Rights granted 3,389,500 861,000 10,774,500 1,349,000
Weighted average share value $5.53 $5.62 $3.82 $4.55
Expected volatility 30.0% 30.0% 35.0% 35.0%
Dividend yield 1.1% 1.1% 1.6% 1.3%
Risk-free interest rate 0.20% 0.30% 0.30% 0.30%
The expected volatility was determined having regard to the historical volatility of Qantas shares and the implied volatility on exchange traded
options. The risk-free rate was the yield on an Australian Government Bond at the grant date matching the remaining useful lives of the plans.
The yield is converted into a continuously compounded rate in the model. The expected life assumes immediate exercise after vesting.
(B) SHORT TERM INCENTIVE PLAN (STIP)
For details on the operation of the STIP see pages 48 to 50. There were nil awards of Qantas shares made during the year ended 30 June 2022
(2021: nil).

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Notes to the Financial Statements continued

For the year ended 30 June 2022

26 SHARE-BASED PAYMENTS (CONTINUED)

(C) MANAGER INCENTIVE PLAN (MIP)
The MIP is the annual incentive plan for the broader Management group. Each year, to the extent that the plan’s performance conditions are
achieved, this group may receive an award that is a combination of cash and restricted shares. The scorecard performance outcomes are the
same as those for STIP. For scorecard performance outcomes, refer to the details of the operation of the STIP on pages 48 to 50. The CEO
retains discretion over any awards made under the MIP. There were nil awards of Qantas shares made during the year ended 30 June 2022
(2021: nil).
(D) RECOVERY RETENTION PLAN (RRP)
The Recovery and Retention Plan was announced in the second half of the 2021/22 financial year and includes a grant of Rights to eligible
employees (both non-executive and executive) subject to both performance and service conditions. Vesting will occur in August 2023
provided all the performance conditions are achieved and participants remain employed with the Qantas Group at that time. All Rights are
redeemable on a one-for-one basis for Qantas shares, subject to the achievement of performance hurdles. Dividends are not payable on the
Rights. For more information on the operation of the RRP, see page 52.
2022 2021
Performance Rights Reconciliation Number of Rights Number of Rights
Rights outstanding as at 1 July — —
Rights granted during the year 42,931,072 —
Rights outstanding as at 30 June 42,931,072 —
The Rights will be tested against the performance hurdles as at 30 June 2023 and approved by the Board in August 2023.
i. Fair Value Calculation
The estimated value of Rights granted was determined at grant date using a simplification of the Black-Scholes option pricing formula. The
weighted average fair value of Rights granted during the year was $4.98.
2022
Inputs into the Models 28 February 2022
Rights granted 42,931,072
Weighted average share value $4.98
Dividend yield 0.9%

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Notes to the Financial Statements continued

For the year ended 30 June 2022

27 FINANCIAL RISK MANAGEMENT

(A) RISKS
The Qantas Group is subject to financial risks, which are an inherent part of the operations of an airline. The Qantas Group manages these risk
exposures using various financial instruments and governed by a set of policies approved by the Board. The Qantas Group’s policy is not to
enter into, issue or hold derivative financial instruments for speculative trading purposes.
The Qantas Group uses different methods to assess and manage different types of financial risk to which it is exposed. These methods
include correlations between risk types, sensitivity analysis in the case of interest rate, foreign exchange and other price risks, and ageing
analysis and sensitivity analysis for liquidity and credit risk. A summary of these risks has been presented below:

Risk Nature of Risk Management of Risk

Liquidity risk Difficulty in meeting financial liability Remaining within optimal capital structure, targeting a minimum liquidity
obligations. level, ensuring long-term commitments are managed, maintaining access to a
variety of additional funding sources and managing maturity profiles.
Interest rate Fluctuations in the fair value or future Floating versus fixed rate debt framework, interest rate swaps, forward rate
risk cash flows of a financial instrument agreements and options.
because of changes in market interest
rates.
Foreign exchange Fluctuations in the fair value of future Forward foreign exchange contracts, currency options, cross-currency swaps
risk cash flows or assets/liabilities and designation of non-derivative foreign currency liabilities in a cash flow
denominated in a currency other than hedge relationship.
AUD because of changes in foreign
exchange rates.
Fuel price risk Exposure of future AUD fuel to USD price – options and swaps on jet kerosene, gasoil and crude oil.
unfavourable USD-denominated price Foreign exchange risk – foreign exchange contracts and currency options.
movements and foreign exchange
movements.
Credit risk Potential loss from a transaction Trade debtor counterparties – use of International Air Transport Association
in the event of a default by a (IATA) clearing mechanism which undertakes its own credit review of
counterparty during the term or members, and stringent credit policies where the Group provides credit to
on settlement of a transaction. customers directly.
Other financial asset counterparties – transact only with counterparties that
have acceptable credit ratings and counterparty limits.

i. Liquidity Risk

Nature of the risk

Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with its financial liabilities.
Liquidity risk management
The Qantas Group manages liquidity risk by targeting a minimum liquidity level, ensuring long-term commitments are managed with respect
to forecast available cash inflows, maintaining access to a variety of additional funding sources, including commercial paper and standby
facilities, managing maturity profiles and maintaining an unencumbered pool of assets. Qantas may from time to time seek to purchase and
retire outstanding debt through cash purchases in open market transactions, privately negotiated transactions or otherwise. Any such
repurchases would depend on prevailing market conditions, liquidity requirements and possibly other factors.
The Qantas Group has maintained a prudent liquidity policy during the 2021/22 financial year, ensuring adequate coverage of liquidity
requirements while considering a range of adverse scenarios.
During the first half of 2021/22, $500 million of additional debt was raised through a medium-term note issuance while $384 million of
scheduled debt repayments were made.
In the second half of 2021/22, the Qantas Group prepaid $450 million of the Corporate Secured Debt Program as the Group prioritised
reducing debt and maintaining minimal refinancing risk across the maturity profile. A further $607 million of scheduled debt repayments were
made which included a $300 million repayment of the 2022 Bond. The Group continues to have no financial covenants on any of its debt.
As at 30 June 2022, the Group’s available liquidity was $4.6 billion, including $3.3 billion of cash and cash equivalents and $1.3 billion in
standby facilities maturing in financial years 2023/24, 2025/26 and 2026/27. In addition, the Group maintains an unencumbered asset base
greater than $3.5 billion, including 49 per cent of the Group’s fleet, spare engines and other assets.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

27 FINANCIAL RISK MANAGEMENT (CONTINUED)

(A) RISKS (CONTINUED)
i. Liquidity Risk (continued)
The following table summarises the contractual timing of cash flows, including estimated interest payments, of financial liabilities and
derivative instruments. The contractual amount assumes current interest rates and foreign exchange rates. The amounts disclosed in the
table are undiscounted.
2022
Less Than More Than
$M 1 Year 2 to 3 Years 4 to 5 Years 5 Years Total
Financial liabilities
Payables 2,474 — — — 2,474
Lease liabilities1 419 496 232 488 1,635
Bank loans – secured2 363 600 394 466 1,823
Bank loans – unsecured2 10 459 — — 469
Other loans – secured2 424 443 414 937 2,218
Other loans – unsecured2 81 393 430 1,572 2,476
Derivatives – outflows/(inflows) — — — — —
Net other financial assets/liabilities – outflows/(inflows)3 (556) (62) 281 — (337)
Total financial liabilities 3,215 2,329 1,751 3,463 10,758

2021 Less Than More Than

$M 1 Year 2 to 3 Years 4 to 5 Years 5 Years Total
Financial liabilities
Payables 1,813 44 — — 1,857
Lease liabilities1 397 623 234 485 1,739
Bank loans – secured2 475 719 405 639 2,238
Bank loans – unsecured2 7 15 446 — 468
Other loans – secured2 292 772 426 1,435 2,925
Other loans – unsecured2 388 374 106 1,394 2,262
Derivatives – outflows 2 — — — 2
Net other financial assets/liabilities – inflows3 (162) (32) — — (194)
Total financial liabilities 3,212 2,515 1,617 3,953 11,297
1 This represents the Group’s contractual undiscounted cash flows relating to leases.
2 Recognised financial liability maturity values are shown pre-hedging.
3 Excluding equity investments.
ii. Interest Rate Risk

Nature of the risk

Interest rate risk refers to the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market
interest rates. The Qantas Group has exposure to movements in interest rates arising from its portfolio of interest rate sensitive assets and
liabilities, which are predominantly in AUD and USD currencies. These principally include corporate debt, leases and cash.
Management of interest rate risk
The Qantas Group manages interest rate risk by using a floating versus fixed rate debt framework. The relative mix of fixed and floating
interest rate funding is managed by using interest rate swaps, forward rate agreements and options. As at 30 June 2022, interest-bearing
liabilities amounted to $5,960 million (2021: $6,830 million). The fixed/floating split is 48 per cent and 52 per cent respectively (2021: 41 per
cent and 59 per cent). As noted in Note 23(C), the Group manages its exposure to interest rate risk with reference to the Group’s Financial
Framework where the fixed/floating ratio is measured against Net Debt. The Group’s Net Debt is a non-statutory measure and includes on
balance sheet debt, cash and capitalised aircraft lease liabilities. The ratio of fixed/floating on Net Debt is 91 per cent and 9 per cent
respectively, which assumes cash is treated as floating (2021: 63 per cent and 37 per cent). As at 30 June 2022, other financial assets and
liabilities including derivative financial instruments relating to debt obligations and future interest payments were nil (2021: $2 million
(liability)). These are recognised at fair value.

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For the year ended 30 June 2022

27 FINANCIAL RISK MANAGEMENT (CONTINUED)

(A) RISKS (CONTINUED)
ii. Interest Rate Risk (continued)

Sensitivity to interest rate risk

Profit Before Tax Equity (Before Tax)1
$M 2022 2021 2022 2021
100bps increase in interest rates2,3
Variable rate interest-bearing instruments (net of cash) (2) (20) — —
Derivatives designated in a cash flow hedge relationship — — — —
100bps decrease in interest rates2,3
Variable rate interest-bearing instruments (net of cash) 2 20 — —
Derivatives designated in a cash flow hedge relationship — — — —
1 Equity (Before Tax) does not include sensitivity recognised in Profit/(Loss) Before Tax.
2 Sensitivity analysis assumes hedge designations as at 30 June 2022 remain unchanged.
3 Sensitivity analysis excludes impact of discount rate movements on provisions.

Under AASB 16, interest rate movements on lease liabilities are treated as modifications against the corresponding right of use asset and
lease liability. As such, there is no immediate impact to the Consolidated Income Statement or Other Comprehensive Income and as a result,
interest rate movements on lease liabilities are not included as an interest rate sensitivity.
iii. Foreign Exchange Risk

Nature of the risk

Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not
the functional currency of the Group. The Group operates internationally and is exposed to foreign exchange risk, primarily the US dollar. The
source and nature of this risk arises from operations, capital expenditure and revaluation risk. The revaluation risk primarily exists in interest-
bearing liabilities, lease liabilities and other financial assets and liabilities. The Group hedges foreign exchange risk with the objective of
minimising volatility of the Australian currency cost of highly probable forecast purchases and disposals of property, plant and equipment
and other revenue and operating expenditures.
Management of foreign exchange risk
Forward foreign exchange contracts and currency options are used to hedge a portion of net foreign currency exposures in accordance with
Qantas Group policy. Net foreign currency exposures, including foreign currency purchases and disposals of property, plant and equipment,
may be hedged out to two years within specific parameters. Any hedging outside these parameters requires approval by the Board. For the
year ended 30 June 2022, other financial assets and liabilities including derivative financial instruments relating to the hedging of future
capital expenditure totalled $31 million (net asset) (2021: nil) and those relating to the hedging of future operating expenditure payments were
nil (2021: $12 million (net asset)). These are recognised at fair value.
Non-derivative financial liabilities including interest-bearing liabilities and lease liabilities are designated in a cash flow hedge relationship to
hedge forecast foreign currency revenue. These interest-bearing liabilities and lease liabilities have a maturity between one and thirteen
years. To the extent a foreign exchange gain or loss is incurred, and the cash flow hedge is deemed effective, this is deferred until the revenue
is realised. As at 30 June 2022, total unrealised foreign exchange gains on hedges of revenue designated to non-derivative financial liabilities
was $2 million (2021: $109 million gains).
Sensitivity to foreign exchange risk
Profit Before Tax Equity (Before Tax)1
$M 2022 2021 2022 2021
20% movement in foreign exchange risk2,3
20% (2021: 20%) USD depreciation — — (257) (190)
20% (2021: 20%) USD appreciation — — 413 285
1 Equity (Before Tax) does not include sensitivity recognised in Profit/(Loss) Before Tax.
2 Sensitivity analysis assumes hedge designations as at 30 June 2022 remain unchanged. Sensitivity analysis on foreign currency pairs of 20 per cent represent reasonable volatility in
market conditions.
3 Sensitivity analysis includes foreign currency interest-bearing liabilities, lease liabilities and derivatives designated in a hedge relationship.

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For the year ended 30 June 2022

27 FINANCIAL RISK MANAGEMENT (CONTINUED)

(A) RISKS (CONTINUED)
iv. Fuel Price Risk

Nature of the risk

Exposure of future AUD fuel costs to unfavourable USD-denominated price and foreign exchange movements.
Management of future AUD fuel costs risk
The Qantas Group uses options and swaps on jet kerosene, gasoil and crude oil to hedge exposure to movements in the USD price of aviation
fuel. The Group considers the crude component to be a separately identifiable and measurable component of aviation fuel. In identifying this
component, the Group considers long-term correlation levels between crude hedging products and underlying jet fuel exposure. The foreign
exchange risk in the total fuel cost is separately hedged using foreign exchange contracts and currency options. Hedging is conducted in
accordance with Qantas Group policy. Fuel consumption out to two years may be hedged within specific parameters, with any hedging outside
these parameters requiring approval by the Board. For the year ended 30 June 2022, other financial assets and liabilities included fuel and
foreign exchange derivatives totalling $587 million (net asset) (2021: $181 million (net asset)). These are recognised at fair value.
Sensitivity to foreign exchange and fuel price risk
Profit Before Tax Equity (Before Tax)1
$M 2022 2021 2022 2021
20% movement in AUD fuel costs2
20% (2021: 20%) USD depreciation, 20% (2021: 20%) increase per barrel in — — 271 69
fuel indices
20% (2021: 20%) USD appreciation, 20% (2021: 20%) decrease per barrel — — (35) 122
in fuel indices
1 Equity (Before Tax) does not include sensitivity recognised in Profit/(Loss) Before Tax.
2 Sensitivity analysis assumes hedge designations as at 30 June 2022 remain unchanged. Sensitivity analysis on foreign currency pairs and fuel indices of 20 per cent represents
reasonable volatility in market conditions. Sensitivity analysis assumes an offset between USD and fuel price indices based on observed market movements.
v. Credit Risk

Nature of the risk

Credit risk is the potential loss from a transaction in the event of default by the counterparty during the term of the transaction or on
settlement of the transaction. The Group has credit exposure in respect of trade receivables and other financial instruments in the ordinary
course of business. The maximum exposure to credit risk is represented by the carrying value of financial assets.
Management of credit risk
The Qantas Group conducts transactions with the following major types of counterparties:
– Trade debtor counterparties: The credit risk is the recognised amount, net of any impairment losses. As at 30 June 2022, trade debtors
amounted to $988 million (2021: $483 million). The Qantas Group has credit risk associated with travel agents, codeshare partners,
industry settlement organisations, and credit provided to direct customers, such as large airline, loyalty and freight corporate customers. A
significant proportion of receivables are settled through the International Air Transport Association (IATA) clearing mechanism which
undertakes its own credit review of members. The Qantas Group minimises this credit risk through the application of stringent credit
policies and accreditation of travel agents through industry programs
– Other financial asset counterparties: The Qantas Group restricts its dealings to counterparties that have acceptable credit ratings. Should
the rating of a counterparty fall below certain levels, internal policy dictates that approval by the Board is required to maintain the level of
the counterparty exposure. Alternatively, Management may consider closing out positions with the counterparty or novate open positions
to another counterparty with acceptable credit ratings.
The Qantas Group minimises the concentration of credit risk by undertaking transactions with a large number of customers and
counterparties in various countries in accordance with Board-approved policy. As at 30 June 2022, the credit risk of the Qantas Group to
counterparties in relation to other financial assets, cash and cash equivalents, and other financial liabilities amounted to $3,981 million (2021:
$2,416 million). Refer to Note 27(C) for offsetting disclosures of contractual arrangements. The Qantas Group’s credit exposure in relation to
these assets is with counterparties that have a minimum credit rating of A-/A3, unless individually approved by the Board.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

27 FINANCIAL RISK MANAGEMENT (CONTINUED)

(B) FAIR VALUE
The fair value of cash, cash equivalents and non-interest-bearing financial assets and liabilities approximates their carrying value due to their
short maturity. The fair value of financial assets and liabilities is determined by valuing them at the present value of future contracted cash
flows. The fair value of forward foreign exchange and fuel contracts is determined as the unrealised gain/loss at balance date by reference to
market exchange rates and fuel prices. The fair value of interest rate swaps is determined as the present value of future contracted cash
flows. Cash flows are discounted using standard valuation techniques at the applicable market yield, having regard to the timing of the cash
flows. The fair value of options is determined using standard valuation techniques. Other financial assets and liabilities represent the fair
value of investments, put option liability and derivative financial instruments recognised on the Consolidated Balance Sheet. Refer to Note
38(C) for a definition of the fair value hierarchy.
June 2022 June 2021
Carrying Amount Held at Carrying Amount Held at
Fair Value Fair Value Fair Value Fair Value
Through Through Other Through Through Other
Profit and Comprehensive3 Amortised Profit and Comprehensive3 Amortised
$M Loss Income Cost Fair Value Loss Income Cost Fair Value
Cash and cash equivalents — — 3,343 3,345 — — 2,221 2,222
Receivables — — 1,107 1,107 — — 633 633
Other financial assets1 707 115 18 840 213 148 — 361
Financial asset 707 115 4,468 5,292 213 148 2,854 3,216
Payables — — 2,474 2,474 — — 1,857 1,857
Interest-bearing liabilities2 — — 5,960 6,160 — — 6,830 7,608
Other financial liabilities1 89 224 — 313 22 — — 22
Financial liabilities 89 224 8,434 8,947 22 — 8,687 9,487
1 Other financial assets and liabilities represents the fair value of equity investments, the put option liability and derivative financial instruments recognised on the Consolidated
Balance Sheet. Derivative financial instruments have been measured at fair value using Level 2 inputs in estimating their fair values. Equity instruments have been measured at fair
value using Level 1 or Level 2 inputs in estimating their fair value. The put option liability is measured at the present value of the amount expected to be paid under the put option,
subsequent movements are recognised within put option reserve.
2 The fair value of interest-bearing liabilities is calculated as the present value of outstanding contractual cash flows discounted at a risk-free rate.
3 As at 30 June 2022, $113 million of the $115 million (2021: $146 million of the $148 million) of other financial assets relate to the Group’s investment in Alliance Airlines Limited
(ASX: AQZ), which has been accounted for as an investment held at fair value through other comprehensive income under AASB 9.

During the year, the Group recognised fair value changes in relation to listed and unlisted equity investments, net of tax in other
comprehensive income of ($22) million loss (2021: $29 million gain). The Group recognised fair value changes, net of tax of ($22) million loss
(2021: $35 million gain) in respect of listed equity investment using Level 1 inputs. The Group recognised fair value changes, net of tax of
nil (2021: ($6) million loss) in respect of unlisted equity investments using Level 2 inputs.
(C) DERIVATIVES AND HEDGING INSTRUMENTS
The following section summarises derivative financial instruments in the Consolidated Financial Statements:

Type of Hedge Description Derivative

Cash Flow Hedges A derivative or financial instrument to Exchange derivative contracts to hedge future AUD fuel costs and
hedge the exposure to variability in cash foreign currency operational payments (forwards, swaps or options).
flows attributable to a particular risk Interest rate derivative contracts to hedge future interest payments
associated with an asset, liability or (forwards, swaps or options).
forecast transaction.
Foreign exchange derivative contracts to hedge future capital
expenditure payments (forwards or options).
The Group’s derivative assets and liabilities as at 30 June 2022 are detailed below:
2022 2021
$M Current Non-current Total Current Non-current Total
Derivative assets
Designated as cash flow hedges 623 84 707 176 37 213
Total derivative assets 623 84 707 176 37 213
Derivative liabilities
Designated as cash flow hedges (67) (22) (89) (17) (5) (22)
Total derivative liabilities (67) (22) (89) (17) (5) (22)
Net derivative assets 556 62 618 159 32 191

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Notes to the Financial Statements continued

For the year ended 30 June 2022

27 FINANCIAL RISK MANAGEMENT (CONTINUED)

(C) DERIVATIVES AND HEDGING INSTRUMENTS (CONTINUED)
i. Offsetting
The Group enters into contractual arrangements such as the International Swaps and Derivatives Association (ISDA) Master Agreement where,
upon the occurrence of a credit event (such as default), a termination value is calculated and only a single net amount is payable in
settlement of all transactions that are capable of offset under the terms of the contract. The ISDA agreements do not meet the criteria for
offsetting in the Consolidated Balance Sheet and consequently, financial assets and liabilities are recognised as gross. This is because the
Group does not have any current legally enforceable right to offset recognised amounts, as the right to offset is enforceable only on the
occurrence of future events. The amounts shown as financial assets and financial liabilities would each have been $89 million lower (2021:
$21 million lower) in the event of the right to offset being currently enforceable.
ii. Hedge Reserve
The effective portion of the cumulative net change in the fair value of derivative financial instruments designated as a cash flow hedge and
the cumulative change in fair value arising from the time value of options are included in the hedge reserve. These options relate entirely to
transaction-related hedged items. For further information on accounting for derivative financial instruments as cash flow hedges, refer to
Note 38(C). For the year ended 30 June 2022, $355 million gain (2021: $101 million gain) is expected to be released to the Consolidated
Income Statement within one year and $39 million gain (2021: $75 million gain) after one year. Other financial assets and liabilities represent
the fair value of derivative financial instruments recognised on the Consolidated Balance Sheet. Refer to Note 38(C) for a definition of the fair
value hierarchy.
iii. De-Designated Hedging
The Group has applied judgement in assessing whether forecast purchases are still expected to occur. Given the significant decrease in flying
activity compared to expectations at 30 June 2021, $29 million of hedge gains were de-designated and recognised immediately in the
Consolidated Income Statement during the 2021/22 financial year. Prospective changes in fair value of de-designated hedging were
accounted for through the Consolidated Income Statement, resulting in a $7 million loss. The net impact ($22m gain) has been reported in the
Consolidated Income Statement as de-designation and ineffectiveness of fuel and foreign exchange hedges.
iv. Hedge Accounting

Change in
Value of the Change in Change in Amount
Hedging Value of the Value of the Reclassified De-
Nominal Carrying Amount Instrument Hedged Item Hedging Hedge from the designated
Amount of of the Hedging Used for used for Instrument Ineffective- Cash Flow Cash Flow
Hedging Instrument1,2 Calculating Calculating Recognised ness Hedge hedges
Instrument Hedge Hedge in Other Recognised Reserve to Reclassified
and Hedged Hedge Ineffective- Ineffective- Comprehensive in Profit or Profit or to Profit or3
As at Item Rates Assets Liabilities ness ness Income Loss Loss Loss
30 June 2022 M $M $M $M $M $M $M $M $M $M
Cash flow
hedges
AUD fuel costs 20 Barrels AUD / 662 (75) 780 (773) 773 7 (372) (29)
(up to 2 years) Barrel
78-223
Revenue 711 USD AUD / USD — (667) (87) 87 (87) — (19) —
(up to 13 years) 0.69

Capital 732 USD AUD / USD 45 (14) 15 (15) 15 — — —

expenditure 0.69-0.73
(up to 2 years)
Interest — AUD N/A — — 1 (1) 1 — — —
(up to 2 years)

1 Derivative cash flow hedging instruments are located within the Other Financial Assets and Other Financial Liabilities on the Consolidated Balance Sheet and include costs of hedging.
The carrying amount of the hedging instrument is presented in AUD where the hedged item equals the nominal amount of the hedging instrument.
2 The revenue hedging instrument is a non-derivative financial liability with the carrying amount presented in USD and is located within interest-bearing liabilities and lease liabilities.
3 $22 million of hedge gains were de-designated and recognised to the Consolidated Income Statement for the year ended 30 June 2022. This includes $29 million released from hedge
reserve and $7 million loss of fair value changes since de-designation.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

28 AUDITOR’S REMUNERATION
2022 2021
$'000 $'000
AUDIT AND AUDIT-RELATED SERVICES
Audit and review of Financial Report 3,517 3,545
Regulatory assurance services 39 4
Total audit and audit-related services 3,556 3,549

OTHER ASSURANCE SERVICES

Other assurance services 161 148
Total other assurance services 161 148

OTHER SERVICES
Taxation services 175 269
Due diligence services — 5
Other non-audit services 188 25
Total other services 363 299
Total auditor's remuneration 4,080 3,996

29 NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT

RECONCILIATION OF STATUTORY LOSS FOR THE YEAR TO NET CASH FROM OPERATING ACTIVITIES
2021
2022 (restated)
Notes $M $M
Statutory loss for the year (860) (1,692)
Adjusted for:
Depreciation and amortisation 5 1,801 1,877
Impairment of assets and related costs 25(C) 35 270
Hedging-related activities (118) (64)
Share of net loss of investments accounted for under the equity method 14 126 129
Share-based payments 26 63 19
Net gain on disposal of assets 6 (692) (26)
Discount rate changes impact on provisions 7 (194) (4)
Other items 95 66
Changes in other items:
Receivables (476) (14)
Inventories (14) 19
Other assets (18) 58
Payables 657 (416)
Revenue received in advance 2,395 402
Provisions 201 (403)
Deferred tax assets/liabilities and tax payable/receivable (331) (607)
Net cash inflow/(outflow) from operating activities 2,670 (386)

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Notes to the Financial Statements continued

For the year ended 30 June 2022

30 SUPERANNUATION
The Qantas Superannuation Plan (QSP) is a hybrid defined benefit/defined contribution fund with multiple divisions that commenced
operation in June 1939. In addition to the QSP, there are other small overseas defined benefit plans. The Qantas Group makes contributions to
defined benefit plans that provide defined benefit amounts for employees upon retirement. Under these plans, employees are entitled to
retirement benefits determined, at least in part, by reference to a formula based on years of membership and salary levels.
The defined benefit plans are legally separated from the Qantas Group. Responsibility for governance of the plans, including investment
decisions and plan rules, rests solely with the Trustee of the plan. The Trustee of the QSP is a corporate trustee which has a Board comprising
five company-appointed Directors and five member-elected Directors.
The QSP’s defined benefit plan exposes the Group to a number of risks, the most significant of which are detailed below:
– Investment risk: The investment strategy for the assets attributable to the QSP’s defined benefit liabilities is to progressively de-risk the
defined benefit investment portfolio as the funding position improves over time. If investment returns underperform expectations, the
Group may be required to provide additional funding to the QSP
– Interest rate risk: Changes in bond yields, such as a decrease in corporate bond yields, will increase defined benefit liabilities through the
discount rate assumed
– Inflation risk: The defined benefit liabilities are linked to salary inflation, and higher salary inflation will lead to higher liabilities.
(A) FUNDING
Employer contributions to the defined benefit divisions of the QSP are based on recommendations by the QSP’s plan actuary. It is estimated
that $28 million of normal employer contributions will be paid by the Qantas Group to its defined benefit plans in financial year 2022/23.
In addition, the Trustee of the QSP and the Group have in place an Additional Funding Plan (AFP), last agreed in 2019, which is an evergreen
restoration plan and addresses the requirements of APRA Prudential Standard SPS 160. The determination of Qantas’ additional employer
contributions under the AFP is triggered if the quarterly determination of the Defined Benefit Vested Benefits Index (DB VBI) indicates that the
DB VBI has been below 100 per cent for two consecutive quarters, or the value of the DB VBI has fallen from a value in excess of 100 per cent
at the previous quarter to a value that is less than 96 per cent. The DB VBI is the ratio of the QSP’s assets attributable to the defined benefit
liabilities to the total defined benefit amount that the QSP would be required to pay if all members were to voluntarily leave the plan on the
funding valuation date. Additional benefit payment top-up contributions may also be payable if after two consecutive quarters, the DB
Retrenchment Benefits Index is less than 100 per cent, the DB VBI is below 105 per cent, and retrenchments occur that place a greater than
VBI level of funding strain on the Plan assets. The last additional contribution required under the AFP was paid into the QSP by the Group in
December 2016. The QSP’s financial position is monitored by the Trustee each quarter.
(B) MOVEMENT IN NET DEFINED BENEFIT (ASSET)/LIABILITY

Present Value of Fair Value of Plan Net Defined Benefit

Obligation Assets (Asset)/Liability1
$M $M $M
2022 2021 2022 2021 2022 2021
Balance as at 1 July 1,762 2,442 (2,079) (2,470) (317) (28)
Included in the Consolidated Income Statement
Current service cost 88 110 — — 88 110
Interest expense/(income) 52 57 (59) (57) (7) —
Contributions by plan participants — — (19) (10) (19) (10)
Losses on curtailments — 8 — — — 8
Total amount included in manpower and staff-related expenditure 140 175 (78) (67) 62 108
Included in the Consolidated Statement of Comprehensive Income
Return on plan assets, excluding interest income — — 70 (252) 70 (252)
Losses from change in demographic assumptions — 3 — — — 3
Gains from change in financial assumptions (398) (91) — — (398) (91)
Experience losses/(gains) 37 (19) — — 37 (19)
Exchange differences on foreign plans (3) (4) 4 4 1 —
Total amount recognised in other comprehensive income (364) (111) 74 (248) (290) (359)
Contributions by employer — — (4) (38) (4) (38)
Benefit payments (151) (208) 151 208 — —
Assets distributed/liabilities extinguished on settlements from — (536) — 536 — —
Other movements 18 — (8) — 10 —
Balance as at 30 June 1,405 1,762 (1,944) (2,079) (539) (317)
1 The net defined benefit asset is included in non-current other assets (refer to Note 19).

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Notes to the Financial Statements continued

For the year ended 30 June 2022

30 SUPERANNUATION (CONTINUED)
(C) PLAN ASSETS
The major categories of plan assets as a percentage of total plan assets of the Group’s defined benefit plans are as follows:
2022 2021
% %
Australian equity1,2 10 13
Global equity1
– United States 9 12
– Europe 1 3
– Japan 1 1
– Other 4 3
Private equity 6 6
Fixed interest1
– Government bonds 17 13
– Other 32 14
Credit
– Corporate debt — 12
– Other — 8
Hedge funds 1 1
Property and infrastructure 4 4
Agriculture 6 4
Timberland 2 2
Insurance policies 2 —
Cash and cash equivalents1 5 4
Total 100 100
1 The majority of these plan assets have a quoted market price in an active market.
2 As at 30 June 2022, QSP assets in shares of Qantas Airways Limited (ASX:QAN) are $747,767 (2021: $2,635,470).

The Trustee of the QSP is responsible for setting the investment strategy and objectives for the QSP’s assets to support the defined benefit
liabilities. The QSP does not use any asset-liability matching strategies. It utilises traditional investment management techniques to manage
the defined benefit assets.
(D) ACTUARIAL ASSUMPTIONS AND SENSITIVITY
The significant actuarial assumptions (expressed as weighted averages per annum) were as follows:
2022 2021
% %
Discount rate 5 3
Long-term future salary increase1 2 2
1 For the 30 June 2022 actuarial calculation, specific increase rates were assumed for years 1 to 5, averaging 1.8 per cent and then 2 per cent for the remaining duration of the plan
(30 June 2021: salary increases of 1.5 per cent in years 1 to 5 and 2 per cent for the remaining duration of the plan were assumed).

The weighted average duration of the QSP’s defined benefit obligation as at 30 June 2022 was nine years (2021: 10 years). The sensitivity of
the defined benefit obligation to changes in the significant assumption is as follows:
Impact on Defined Benefit Obligation
30 June 2022 30 June 2021
Change in Decrease in Decrease in
Assumption Increase in Assumption Assumption Increase in Assumption Assumption
Discount rate 1% Decrease by 9.5% Increase by 12.8% Decrease by 12% Increase by 11.9%
Future salary increase 1% Increase by 5.8% Decrease by 3.8% Increase by 4.5% Decrease by 6.9%

Defined Contribution Fund

A defined contribution expense of $153 million has been recognised for the year ended 30 June 2022 (2021: $107 million).

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Notes to the Financial Statements continued

For the year ended 30 June 2022

31 DEED OF CROSS GUARANTEE

Pursuant to ASIC Corporations (Wholly-owned Companies) Instrument 2016/785 (Instrument), the wholly-owned entities identified below are
relieved from the Corporations Act 2001 (Cth) requirements for preparation, audit, distribution and lodgement of Financial Statements and
Directors’ Reports:

AAL Aviation Limited National Jet Operations Services Pty Ltd Qantas Ground Services Pty Ltd
Airlink Pty Ltd Network Aviation Holdings Pty Ltd Qantas Group Flight Training (Australia) Pty
Australian Air Express Pty Ltd Network Aviation Pty Ltd Qantas Group Flight Training Pty Ltd
Australian Airlines Limited Network Holding Investments Pty Ltd Qantas Information Technology Limited
Australian Regional Airlines Pty Ltd Network Turbine Solutions Pty Ltd Qantas Road Express Pty Ltd
Eastern Australia Airlines Pty Ltd Osnet Jets Pty Ltd Qantas Ventures Pty Limited
Express Freighters Australia (Operations) Pty Ltd Q H Tours Limited QF Cabin Crew Australia Pty Ltd
Express Freighters Australia Pty Ltd Qantas Asia Investment Company Pty Ltd Regional Airlines Charter Pty Ltd
Impulse Airlines Holdings Pty Ltd Qantas Courier Limited Sunstate Airlines (Qld) Pty Ltd
Jetstar Airways Pty Ltd Qantas Domestic Pty Ltd The Network Holding Trust
Jetstar Asia Holdings Pty Ltd Qantas Freight Enterprises Limited The Network Trust
Jetstar Group Pty Ltd Qantas Frequent Flyer Limited Vii Pty Limited
Jetstar Services Pty Ltd Qantas Frequent Flyer Operations Pty Ltd
National Jet Systems Pty Ltd Qantas Group Accommodation Pty Ltd
It is a condition of the Instrument that Qantas and each of the controlled entities eligible to obtain relief under the Instrument enter into a
Deed of Cross Guarantee (Deed). Under the Deed, Qantas guarantees to each creditor payment in full of any debt upon the winding up under
certain provisions of the Corporations Act 2001 (Cth) of any of the controlled entities that are party to the Deed. If the winding up occurs under
other provisions of the Corporations Act 2001 (Cth), Qantas will only be liable if, six months after a resolution or order for the winding up of the
controlled entity, any debt of a creditor of that controlled entity has not been paid in full. Each controlled entity that is party to the Deed has
given similar guarantees in the event that Qantas is wound up.
Qantas and its eligible controlled entities first entered into a Deed on 4 June 2001. Subsequently, additional controlled entities became party
to the Deed by way of Assumption Deeds dated 17 June 2002, 26 June 2006, 29 June 2007, 30 June 2008, 29 June 2009, 16 June 2010,
25 November 2010, 4 April 2011, 13 October 2011, 20 November 2012, 26 November 2015, 26 June 2017, 2 November 2017 and 31 July 2020.
The Consolidated Condensed Income Statement and Consolidated Condensed Balance Sheet for Qantas and each of its controlled entities
that are party to the Deed are set out below. The principles of consolidation are:
– Transactions, balances and unrealised gains and losses on transactions between entities that are party to the Deed are eliminated
– Investments in entities that are not party to the Deed are carried at cost less any accumulated impairment
– Dividends received from entities that are not party to the Deed are recognised as income.
(A) CONSOLIDATED CONDENSED INCOME STATEMENT FOR THE YEAR ENDED 30 JUNE 2022
2021
2022 (restated)
$M $M
Revenue and other income 8,978 5,894
Expenditure (9,675) (7,508)
Impairment of assets and related costs (210) (346)
Statutory loss before income tax benefit and net finance costs (907) (1,960)
Finance income 14 15
Finance costs (311) (307)
Net finance costs (297) (292)
Statutory loss before income tax benefit (1,204) (2,252)
Income tax benefit 341 608
Statutory loss for the year (863) (1,644)
Accumulated losses as at 1 July (3,220) (1,574)
Transfer of accumulated fair value losses to accumulated losses (6) —
Capital raising, net of tax — (6)
Shares vested and transferred to employees/shares vested and lapsed 2 4
Accumulated losses as at 30 June (4,087) (3,220)

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Notes to the Financial Statements continued

For the year ended 30 June 2022

31 DEED OF CROSS GUARANTEE (CONTINUED)

(B) CONSOLIDATED CONDENSED BALANCE SHEET AS AT 30 JUNE 2022
2021
2022 (restated)
$M $M
CURRENT ASSETS
Cash and cash equivalents 3,214 2,183
Receivables 1,757 1,266
Other financial assets 623 176
Inventories 269 279
Assets classified as held for sale 1 1
Other 240 161
Total current assets 6,104 4,066
NON-CURRENT ASSETS
Receivables 259 425
Other Financial Assets 199 185
Investments in subsidiaries 117 19
Investments accounted for under the equity method 55 55
Property, plant and equipment 10,213 10,774
Right of use assets 944 1,091
Intangible assets 617 724
Deferred tax assets 867 696
Other 920 687
Total non-current assets 14,191 14,656
Total assets 20,295 18,722
CURRENT LIABILITIES
Payables 3,168 2,487
Revenue received in advance 5,712 3,270
Interest-bearing liabilities 769 1,097
Lease Liabilities 382 380
Other financial liabilities 67 17
Provisions 994 1,054
Total current liabilities 11,092 8,305
NON-CURRENT LIABILITIES
Payables — 44
Revenue received in advance 2,066 2,154
Interest-bearing liabilities 5,505 6,191
Lease Liabilities 888 1,015
Other financial liabilities 246 5
Provisions 776 660
Total non-current liabilities 9,481 10,069
Total liabilities 20,573 18,374
Net assets (278) 348
EQUITY
Issued capital 3,186 3,186
Treasury shares (8) (18)
Reserves 631 400
Accumulated losses (4,087) (3,220)
Equity attributable to members of Qantas (278) 348
Non-controlling interests — —
Total equity (278) 348

(C) NET ASSET POSITION OF DEED OF CROSS GUARANTEE (DEED) AS AT 30 JUNE 2022
The Deed’s net asset position of ($278) million at 30 June 2022 (2021: $348 million) is a direct result of the losses incurred since the outbreak
of COVID-19. The negative net asset position does not impact the ability of the parties to the Deed to pay its debts as and when they become
due and payable.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

32 RELATED PARTIES
(A) REMUNERATION OF KEY MANAGEMENT PERSONNEL
The aggregate remuneration of the KMP of the Qantas Group is set out below:
2022 2021
$'000 $'000
Short-term employee benefits 8,323 8,744
Post-employment benefits1 577 657
Other long-term benefits2 71 351
Share-based payments 7,439 6,302
16,410 16,054
1 Post-employment benefits include superannuation and post-employment travel benefits.
2 Other long-term benefits include movements in annual leave and long service leave balances. The accounting value of other long-term benefits may be negative, for example, where
an Executive’s annual leave balance decreases as a result of taking more than annual leave than they accrue during the current year.

Further details in relation to the remuneration of KMP are included in the Directors’ Report from pages 34 to 62.
(B) NON-EXECUTIVE DIRECTOR FEE SACRIFICE SHARE ACQUISITION PLAN
In December 2019, a Non-Executive Director Fee Sacrifice Share Acquisition Plan was introduced whereby Non-Executive Directors can elect
to sacrifice a percentage of their Board or Board and Committee fees in return for a grant of Rights to the equivalent value of the same
number of Qantas ordinary shares. Each Right granted will convert automatically to one fully-paid Qantas ordinary share at the conversion
date, which is six months from the grant date subject to the individual remaining as a Non-Executive Director on the conversion date. The plan
is designed to provide Non-Executive Directors the opportunity to build their shareholding in a tax effective manner and to further align their
interests with the interests of shareholders.
2022 2021
Number of Number of
Non-Executive Director Fee Sacrifice Share Acquisition Plan — Rights Reconciliation Rights Rights
Rights outstanding as at 1 July 44,025 —
Rights acquired during the year by fee sacrifice 64,493 64,487
Rights converted to ordinary shares during the year (76,013) (20,462)
Rights outstanding as at 30 June 32,505 44,025

(C) OTHER RELATED PARTY TRANSACTIONS – ASSOCIATES

Transactions with associates are conducted on normal terms and conditions.
Material transactions between the Qantas Group and associates include:
– The Qantas Group provides airline seats on domestic and international routes to Helloworld Ltd for sale through its travel agency network
– The Qantas Group has established a business service agreement with a Jetstar-branded airline in Japan (Jetstar Japan). As part of the
business service agreement, amongst other services, Qantas allows Jetstar Japan’s credit card transactions to be acquired through the
Qantas Group’s contractual arrangements
– The Qantas Group as part of shareholder arrangements co-guarantees the finance lease obligations for two A320 aircraft on behalf of
Jetstar Japan to the external lessors in exchange for guarantee fees to the Qantas Group and provides indemnities to Japan Airlines for up
to 50 per cent of Japan Airlines’ guarantees to Jetstar Japan’s creditor banks in relation to unsecured loans and letter of credit.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

33 PARENT ENTITY DISCLOSURES – QANTAS AIRWAYS LIMITED

(A) CONDENSED INCOME STATEMENT FOR THE YEAR ENDED 30 JUNE 2022
2021
2022 (restated)
$M $M
Revenue and other income 4,670 2,639
Expenditure (5,411) (4,224)
Impairment of assets and related costs1 (199) (334)
Statutory loss before income tax benefit and net finance costs (940) (1,919)
Net finance costs (272) (266)
Statutory loss before income tax benefit (1,212) (2,185)
Income tax benefit 369 664
Statutory loss for the year (843) (1,521)
1 Impairment of assets and related costs includes the impairment of investments in subsidiaries and intercompany loans of $174 million (2021: $105 million).

(B) CONDENSED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2022
2021
2022 (restated)
$M $M
Statutory loss for the year (843) (1,521)
Effective portion of changes in fair value of cash flow hedges, net of tax 492 201
Transfer of hedging (gains)/losses from hedge reserve to the Condensed Income Statement, net of tax (274) 49
De-designation of fuel and foreign exchange hedges to the Condensed Income Statement, net of tax (20) 15
Recognition of effective cash flow hedges on capitalised assets, net of tax 3 4
Net changes in hedge reserve for time value of options, net of tax 20 42
Defined benefit actuarial gains, net of tax 203 251
Foreign currency translation of investments accounted for under the equity method 1 (2)
Fair value (losses)/gains on investments, net of tax (22) 29
Total other comprehensive income for the year 403 589
Total comprehensive loss for the year (440) (932)

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Notes to the Financial Statements continued

For the year ended 30 June 2022

33 PARENT ENTITY DISCLOSURES – QANTAS AIRWAYS LIMITED (CONTINUED)

(C) CONDENSED BALANCE SHEET AS AT 30 JUNE 2022
2021
2022 (restated)
$M $M
CURRENT ASSETS
Cash and cash equivalents 3,212 2,194
Receivables 535 374
Intercompany receivables 6,596 5,961
Other financial assets 623 176
Inventories 165 165
Assets classified as held for sale 1 1
Other 213 136
Total current assets 11,345 9,007
NON-CURRENT ASSETS
Receivables 36 85
Intercompany receivables 215 330
Investments in subsidiaries 420 432
Other financial assets 199 185
Investments accounted for under the equity method 22 19
Property, plant and equipment 8,954 9,444
Right of use assets 906 1,009
Intangible assets 414 508
Deferred tax assets 727 621
Other 899 687
Total non-current assets 12,792 13,320
Total assets 24,137 22,327
CURRENT LIABILITIES
Payables 1,652 1,204
Intercompany payables 7,176 6,396
Revenue received in advance 4,643 2,495
Interest-bearing liabilities 769 1,097
Lease liabilities 347 312
Other financial liabilities 67 17
Provisions 751 829
Total current liabilities 15,405 12,350
NON-CURRENT LIABILITIES
Payables — 44
Revenue received in advance 2,040 2,148
Interest-bearing liabilities 5,505 6,191
Lease liabilities 856 971
Other financial liabilities 22 5
Provisions 407 334
Total non-current liabilities 8,830 9,693
Total liabilities 24,235 22,043
Net assets (98) 284
EQUITY
Issued capital 3,186 3,186
Treasury shares (8) (18)
Other reserves 855 400
Profit reserves — 1,774
Accumulated losses (4,131) (5,058)
Total equity (98) 284

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Notes to the Financial Statements continued

For the year ended 30 June 2022

33 PARENT ENTITY DISCLOSURES – QANTAS AIRWAYS LIMITED (CONTINUED)

(D) DIVIDENDS DECLARED AND PAID
During the year ended 30 June 2022, Qantas Airways Limited did not declare or pay any dividends. No dividend will be paid in relation to the
year ended 30 June 2022.
(E) CAPITAL EXPENDITURE COMMITMENTS
The capital expenditure commitments held by the parent entity are the same as those held by the Group as disclosed in Note 15(C).
(F) CONTINGENT LIABILITIES
The contingent liabilities held by the parent entity are the same as those held by the Group as disclosed in Note 34.
(G) PARENT ENTITY GUARANTEES IN RESPECT OF DEBTS OF ITS SUBSIDIARIES AND ASSOCIATES
The parent entity has entered into a Deed of Cross Guarantee with the effect that the Company guarantees debts in respect of its subsidiaries.
Further details of the Deed of Cross Guarantee and the subsidiaries subject to the Deed are disclosed in Note 31.
The parent entity related parties in respect to the provision of guarantees are primarily the same as those held by the Group, which are
disclosed in Note 34(A).
(H) INTEREST-BEARING LIABILITIES
The parent entity has total interest-bearing liabilities of $6,274 million (2021: $7,288 million), of which $628 million (2021: $1,035 million)
represents secured loans payable to controlled entities. Of the $5,646 million (2021: $6,253 million) payable to other parties, $3,260 million
(2021: $4,055 million) represents secured bank loans and other secured loans, with the remaining balance representing unsecured loans.
(I) NET ASSET POSITION OF QANTAS AIRWAYS LIMITED AS AT 30 JUNE 2022
Qantas Airways Limited’s net asset position of ($98) million at 30 June 2022 (2021: $284 million) is a direct result of the losses incurred since
the outbreak of COVID-19. The negative net asset position does not impact the ability of Qantas Airways Limited to continue as a going
concern or pay its debts as and when they become due and payable.
At 30 June 2022, the Group’s Net Debt of $3.94 billion (below the target Net Debt range of $4.2 billion to $5.2 billion) was significantly reduced
from $5.89 billion at 30 June 2021 due to the Net Free Cash Flow of $2.4 billion generated during financial year 2021/22. The Group has
available liquidity of $4.6 billion, including $3.3 billion of cash and cash equivalents and a $1.3 billion undrawn facility.

34 CONTINGENT LIABILITIES
Details of contingent liabilities are set out below. The Directors are of the opinion that provisions are not required with respect to
these matters, as it is not probable that a future outflow of economic benefits will be required or that the amount is not capable of reliable
measurement.
(A) GUARANTEES
The Qantas Group co-guarantees the finance lease obligations, on a limited liability basis, in respect of two A320 aircraft on behalf of Jetstar
Japan to the external lessors in exchange for guarantee fees to the Qantas Group. The Qantas Group has also provided indemnities to Japan
Airlines for up to 50 per cent of Japan Airlines’ guarantees provided to Jetstar Japan’s creditor banks in relation to letters of credit for
maintenance reserves on two leased A320 aircraft and unsecured bank loans.
As part of the business service agreements, the Qantas Group has extended support to the Jetstar-branded airline in Japan (Jetstar Japan) by
allowing its credit card transactions to be acquired through the Qantas Group’s contractual arrangements.
Qantas has also entered into guarantees in the normal course of business to secure a self-insurance licence under the Safety, Rehabilitation
and Compensation Act 1988, the New South Wales Workers’ Compensation Act, the Victorian Accident Compensation Act and the Queensland
Workers’ Compensation and Rehabilitation Act, to support non-aircraft lease commitments and other arrangements entered into with third
parties. Due to specific self-insurance provisions raised, the Directors are of the opinion that the probability of having to make a payment
under these guarantees is remote.
(B) LITIGATION
From time to time Qantas is subject to claims and litigation during the normal course of business. The Directors have given consideration to
such matters, which are or may be subject to litigation at year end and, subject to specific provisions raised, are of the opinion that no
material contingent liability exists.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

35 ACQUISITION OF SUBSIDIARY
On 31 May 2022, the Group acquired a 51 per cent controlling equity interest in TAD Holdco Pty Limited (TripADeal) which has been
consolidated into the Group as a subsidiary.
TripADeal was established in 2011, specialising in packaged holidays with set itineraries, including flights, hotel accommodation and tours.
TripADeal will continue to work with a range of airlines, including Qantas and Jetstar, on the holiday packages it offers. TripADeal’s packaged
holiday offering complements the Group’s existing online travel businesses, which focus on flights and hotel packages.
From the date of acquisition up to 30 June 2022, TripADeal’s contribution to revenue and earnings before interest and tax was not material.
Identifiable assets acquired and liabilities assumed
The fair value of TripADeal’s intangible assets (including customer relationships, brand names and intellectual property) has been measured
provisionally, pending completion of an independent valuation. If new information is obtained within one year of the date of acquisition about
facts and circumstances that existed at the date of acquisition and identifies adjustments to the amounts recognised, or any additional
provisions that existed at the date of acquisition, then the accounting for the acquisition will be revised.

Goodwill
The goodwill is mainly attributable to the skills and technical talent of TripADeal’s workforce, the benefits from integrating TripADeal into the
Group’s Loyalty and Airline strategies and expected synergies, and intangible assets that do not qualify for separate recognition. None of the
goodwill recognised is expected to be deductible for tax purposes.
2022
$M
Payment for the acquisition of controlled entities, net of cash acquired1 (54)
Brand names and trademarks 40
Other assets 40
Customer contracts/relationships 7
Revenue received in advance (103)
Other liabilities (17)
Deferred tax liabilities (12)
Fair value of identifiable net liabilities acquired (excluding cash) (45)
Non-controlling interest (5)
Goodwill 104
1 Net of $56 million cash acquired.

Put and call option

In addition, the Group has a call option and minority shareholders have a put option over the remaining 49 per cent of the shares in TripADeal,
exercisable after four years. The put option liability was initially recognised against reserves as reported in the Statement of Changes in
Equity. Subsequent changes in measurement are recognised in reserves in equity.

36 POST-BALANCE SHEET DATE EVENTS

Other than as noted in Note 10 – Dividends and Other Shareholder Distributions, there has not arisen, in the interval between 30 June 2022
and the date of this Report, any other event that would have a material impact on the Consolidated Financial Statements as at 30 June 2022.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

37 MATERIAL BUSINESS RISKS

The aviation industry is subject to numerous inherent risks that can impact operations if left untreated. In rare circumstances, ‘black swan’
risk events can materialise, resulting in unexpected consequences such as those that the aviation industry is experiencing due to COVID-19.
The COVID-19 pandemic has impacted Qantas’ operations significantly, including its strategic, operational and financial objectives.
Material business risks arising from the ongoing impact of COVID-19 are being critically managed to ensure a sustained recovery for the
Group. The Recovery Plan is on track to deliver the targeted $1 billion of ongoing structural cost benefits by financial year 2022/23. With the
prolonged impact of COVID-19, the Group continues to plan for a wide range of scenarios and risks to ensure the Group is well-positioned to
achieve the required level of transformation to support target outcomes and meet travel demand and customer expectations.
Other inherent risks that can impact the Group’s operations include exposure to economic uncertainty and geopolitical instability, changes in
government regulations, volatility in fuel prices and foreign exchange rates, and other exogenous events such as aviation incidents, natural
disasters or international conflicts.
COVID-19 outbreak management: Through its ‘Fly Well’ and ‘Work Well’ programs, Qantas has continued implementing initiatives aimed at
preventing the introduction and spread of COVID-19 in workplaces and aircraft for the protection of our people and our customers. These
controls not only seek to protect health but also support business continuity. The Qantas Group continues to adapt its risk mitigations to
changing circumstances and government regulations and restrictions and will adapt its policies, processes and practices as appropriate.
Given the Group’s geographic footprint, these changes are often jurisdiction-specific, requiring a multi-layered framework to ensure
compliance.
Operational Ramp-up: The Group has seen a faster than expected return of travel demand, for both domestic and international travel, following
the rapid easing of travel restrictions in the second half of financial year 2021/22. Supported by a successful vaccination program, this
includes signs of renewed customer confidence following the delay in travel recovery resulting from Delta and Omicron. Despite this, the
operational challenges presented in the second half of financial year 2021/22 demonstrate that whilst demand may be more resilient to
COVID-19, the operational disruptions created by COVID-19 sickness, tight labour market, and adverse weather and airport infrastructure
events, may continue and particularly if government mandated restrictions return. As such, the Group continues to retain flexibility in
planning its capacity settings, recruiting and training employees to support capacity growth and investing in operations to respond to sudden
changes in demand should further waves of the pandemic occur.
General economic conditions post-crisis: As air travel is closely linked with economic growth, the Qantas Group’s operating and financial
performance is influenced by a variety of general economic and business conditions in Australia and overseas. COVID-19 and the geopolitical
tensions, including the ongoing war in Ukraine and strained relations between China and Taiwan, have created considerable uncertainty and
volatility surrounding these macroeconomic factors, and any further deterioration may have a materially adverse impact on the business,
financial condition and prospects of the Qantas Group. In more recent times, some macroeconomic risks have emerged as central banks
normalise interest rates following an extensive period of accomodative monetary policy, which may impact future economic demand. To
address these risks, the Group retains flexibility to adjust capacity and has developed and identified responses to address a range of
scenarios, including multi-year high fuel prices, low exchange rate, high inflation rate, and weak Australian dollar, to protect the Group’s
financial position.
Fuel and foreign exchange volatility: The Qantas Group is subject to fuel price (including refining margin) and foreign exchange risks. These
risks are an inherent part of the operations of an airline and as such, are an industry-wide risk. For the Qantas Group, the size of the Group’s
fuel and foreign exchange risk will vary with operational capacity, size of fleet renewals and the routes the Group operates. The Qantas Group
manages its fuel and foreign exchange risks through a comprehensive hedging program which provides time for the business to ultimately
adjust its capacity to reflect the new operating environment. This was evident during the second half of financial year 2021/22, with hedging
placed during the COVID-19 period providing some protection against record high fuel prices resulting from the Ukraine war, before necessary
reductions in capacity to generate RASK increases occurred. Qantas will continue to hedge its fuel and foreign exchange risks in line with this
program. The Group normally uses a mix of fuel derivative collars and outright options to cover underlying fuel price risk and is actively
managed for changes in capacity.
Competitive intensity: Ordinarily, the international and domestic aviation markets in which the Qantas Group operates are highly competitive,
and growth in market capacity ahead of underlying demand can impact upon industry profitability. Competitors include many major foreign
airlines (including government-owned or controlled airlines), some with more financial resources or lower cost structures than Qantas. This
competition may increase with the expansion of existing airlines, the consolidation of existing airlines and/or the creation of alliances
between airlines, or new airlines entering the market.
Australia’s aviation policies favour a highly competitive environment, including more liberal rights of entry into Australian domestic and
international markets. These policies have historically attracted offshore competitors (predominantly state-sponsored airlines) to the
Australian international aviation market, which has further increased competition for passengers on international routes. Additionally, the
Qantas Group ordinarily faces high levels of price competition in the markets in which it operates and aggressive pricing by competitors
seeking to gain market share can adversely affect the Qantas Group’s revenues and yield performance. The financial impact of any
discounting of fares as a result of competitive pressures is exacerbated by the high fixed costs that characterise the aviation industry. The
combined effect of these factors may have a materially adverse effect on the revenue and financial condition of the Group.

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For the year ended 30 June 2022

37 MATERIAL BUSINESS RISKS (CONTINUED)

Employee relations: The Qantas Group operates in a highly regulated employment market and a large portion of the Qantas Group’s employees
are represented by unions and are party to collective bargaining arrangements. Any significant enterprise bargaining dispute between the
Qantas Group and its employees, including in relation to the Recovery Plan, could lead employees to take industrial action, including work
stoppages. This could disrupt the Qantas Group’s day-to-day operations and adversely affect business performance, potentially leading to
reputational damage. The Group has developed business continuity planning arrangements, including testing and rehearsal (to the extent
possible), to provide continuity of operations in the event of an industrial action.
In the first half of financial year 2021/22, the Group focused on returning stood down employees to work in response to planned increases in
demand for air travel. These plans were impacted by significant COVID-19 outbreaks which led to widespread lockdowns in New South Wales
and Victoria. The Group recognises that future outbreaks of COVID-19 due to new variants may lead to employees having to further self-
isolate. These periods of self-isolation have also led to operational disruption as frontline staff are unable to attend their workplace resulting
in operational challenges and schedule disruption. This has been amplified as our suppliers and other parts of the aviation industry are
experiencing similar COVID-19-driven resource constraints. This situation requires increased efforts to ensure that our people remain
connected to the organisation, and their health and wellbeing are supported. Relevant information continues to be communicated to our
people through a series of channels, including regular Town Hall meetings hosted by the Group Executive Committee. Employee mental health
continues to be a key area of focus, with enhanced services provided through our Employee Assistance Program as well as manager toolkits
to assist with increasing awareness, identification, support and monitoring of employee mental health.
The prolonged impact of COVID-19 on the airline industry continues to negatively impact the ability to attract and retain appropriate talent and
technical/specialist resources. The labour market’s constrained environment will continue to put pressure on planned capacity given the need
to ramp-up the workforce to support operations over the next few months. Management continues to develop and implement contingency/
action plans to manage the impact of the ongoing labour shortage on the Group.
Customer risk: The ongoing success of the Qantas Group depends to a large degree on customer satisfaction and loyalty, particularly in light of
the significant competition for passengers that characterises the aviation industry. The significant financial and operational challenges posed
by COVID-19, the impact of the pandemic on the travel industry, the opening and closing of domestic and international borders and the
response of the Qantas Group to these challenges could also impact customer satisfaction and loyalty. In particular, a diminution of customer
satisfaction due to the cancellation, credit and refund policies of the Qantas Group in the context of COVID-19 may impact the Qantas Group’s
reputation and its ability to attract customers in the future. The Group continues to provide customers with flexibility and options to utilise
their flight credits, vouchers, and TravelPass and is actively encouraging customer usage. Loss of brand preference due to prolonged
operational issues is also a key customer risk and ensuring on time performance and reliability remains a key priority for the Group.
In addition, the Qantas Group is vulnerable to long-term changes in consumer preferences in relation to its service offerings, the markets in
which it operates, and consumer and business sentiment towards travel, including environmental considerations. Any failure by the Qantas
Group to predict or respond to such changes in a timely and cost-effective manner may adversely impact the Qantas Group’s future operating
and financial performance. As customer preferences shifted significantly due to COVID-19, as well as ensuring operational resilience, the
Group is looking to transform the customer experience through a multi-year program of work aimed at adapting to new customer journey
requirements, market learnings and business need, to ensure the Group’s strong market position is maintained.
Climate change: The Group recognises that human-induced climate change is a significant issue for the aviation industry and is committed to
reducing its greenhouse gas (GHG) emissions in line with the Paris Climate Agreement to limit warming to well below 2 degrees Celsius above
pre-industrial levels, and pursuing efforts to limit the temperature increase to 1.5 degrees Celsius above pre-industrial levels. Climate-related
risks include both physical risks (such as increased extreme weather events) and transition risks (including development of alternative fuel
and changes to government policy, law and regulation). The Group will manage these risks through mechanisms including, but not limited to,
scenario analysis to inform the Group’s strategy; robust governance; adopting lower-GHG emissions technology; operational and market-
based controls; and monitoring government policy. More detail will be provided in the 2022 Sustainability Report. In 2019, the Group
announced its ambition to achieve net zero GHG emissions by 2050 and to cap net GHG emissions at 2019 levels. In March 2022, the Qantas
Group’s Climate Action Plan was released with targets for: a 25 per cent reduction in net emissions from 2019 levels by 2030; 10 per cent
sustainable aviation fuel in fuel mix by 2030; and an average of 1.5 per cent fuel efficiency improvements to 2030.1 The Qantas Group is
responding to increased demand for transparency on identification and management of climate-related risks by aligning its corporate
disclosures with the Taskforce on Climate-related Financial Disclosures (TCFD). These disclosures will be available in the 2022 Sustainability
Report.
Brand reputation: The Qantas brand carries significant commercial value, and the continued success of the Qantas Group relies on the
maintenance of a positive reputation and brand recognition among customers, suppliers, strategic partners and governments. Any negative
publicity (for example, due to a safety incident, labour dispute, regulatory investigation, public customer complaints or operational
performance) may damage Qantas’ reputation and have a negative impact on its business operations and financial performance. The
Customer Insights team constantly monitors customer satisfaction through post-flight surveys and regularly monitors trust in the Qantas
Group brands alongside ongoing research and development of Qantas Group products to mitigate this risk.

1
An average 1.5 per cent per annum fuel efficiency improvement starting from 2023, baselined to 2019.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

37 MATERIAL BUSINESS RISKS (CONTINUED)

Cyber security and data governance: As cyber breaches and attacks surge globally and remote ways of working continue, the Qantas Group
remains focused on embedding cyber security, privacy and data governance into business processes, taking a security and privacy by design
approach and creating a cybersafe and privacy orientated culture that builds on an established safety culture. The Group’s Data Governance
Framework has been enhanced to ensure ethical and commercial data risks are managed in addition to data protection and privacy. Qantas
has a defined Risk and Control Framework, aligned with industry standards, which is designed to protect the confidentiality, integrity,
availability and privacy of data and to maintain compliance with regulatory requirements. The Qantas Group's cyber security and data
privacy-related controls operate to reduce the likelihood and severity of cyber security and data privacy-related incidents and related
impacts. The Group’s cyber and data privacy risks are continuously monitored by the Group Cyber and Privacy Committee and are subject to
independent assurance, including for material third-party suppliers.
Key business partners and alliances: The Qantas Group has relationships with a number of key business partners. In order to continue to
maximise mutual benefit from both a financial and customer proposition perspective, governance structures are in place to track and report
performance against common strategic objectives. The Qantas Group continues to proactively build relationships with existing and new
industry partners through ongoing dialogue with relevant authorities and stakeholder groups.
Key supplier risk: The Qantas Group is dependent on third-party providers for some principal business processes that are integral to its
business. The failure of these providers to adequately perform their service obligations, or other unexpected interruptions of services, may
cause significant disruption to the Group’s operations and have an adverse impact on financial performance. Qantas uses its Business
Continuity Plans to cover the risk of supply failures and has contingency plans in place to respond to key supplier interruption.
The Group continues to work with its key suppliers to improve resource capacity and implement contingency plans to address the labour
shortage challenges driven by the influenza season and recent spike in COVID-19 cases and the corresponding isolation requirements,
coupled with the ongoing tight labour market. The Group has implemented dedicated account management protocols with structured
engagement and Group governance to provide oversight of third-party service providers’ performance to enable the uplift of the Group’s
performance and meet customers’ expectations.
Risk of increase in airport services-related costs or change in availability of airport facilities: The Qantas Group is exposed to the risk of increases
in airport services-related costs (including air traffic control, airport, transit, take-off and landing fees and security charges). The availability
and cost of airport facilities are fundamental to the ability of the Qantas Group to operate.
These costs represent a significant portion of the Qantas Group’s operating costs. The majority of Australian airports are privately owned, and
owners have flexibility to increase charges to airlines. There can be no assurance that major airport operators will not continue to increase
their fees or that the Qantas Group will not incur new costs in Australia or elsewhere (for example, additional fees assessed against
environmental criteria such as emissions levels or noise pollution). Furthermore, it is likely that security and health measures around the
world will continue to be increased in response to the COVID-19 experience and the perceived threat of terrorism, which may lead to increases
in airport clearance and security charges. To the extent that the Qantas Group is unable to pass on any fee increases to its customers, these
developments could have a material adverse effect on the Qantas Group’s operational results and financial position.
In addition, health concerns during the COVID-19 crisis and in the period following it are likely to impact the availability of airport slots and
facilities in ways that are difficult to predict. This could have a materially adverse effect on the Qantas Group’s operations and Recovery Plan.
An overview of the Group Risk Management Framework is contained in the Qantas Group Business Practices Document available at
www.qantas.com.au.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(A) PRINCIPLES OF CONSOLIDATION
i. Controlled Entities
Controlled entities are entities controlled by the Group. Control exists when the Group is exposed to or has rights to variable returns from its
involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of controlled
entities are included in the Consolidated Financial Statements from the date on which control commences until the date on which control
ceases.
ii. Non-Controlling Interests
Non-controlling interests are measured initially at their proportionate share of the acquiree’s identifiable net assets at the date of acquisition.
Non-controlling interests in the results and equity of controlled entities are shown separately in the Consolidated Income Statement,
Consolidated Statement of Comprehensive Income, Consolidated Statement of Changes in Equity and Consolidated Balance Sheet.
iii. Equity Accounted Investments
Associates are those entities in which the Group has significant influence, but not control or joint control, over the financial and operating
policies of an entity. Significant influence is evidenced through, but not limited to, the voting power of the Group, representation on the Board
of Directors and participation in policy-making processes. Interests in associates are accounted for under the equity accounting method and
initially recognised at cost, including transaction costs. Subsequent to initial recognition, the Consolidated Financial Statements include the
Group’s share of profit or loss and other comprehensive income of equity accounted investees, until the date on which significant influence
ceases. Dividends received or receivable reduce the carrying amount of the equity accounted investment.
When the Group’s share of total comprehensive losses exceeds the equity accounted carrying value of an associate, the Group’s carrying
amount is reduced to nil and recognition of further losses is discontinued, except to the extent that the Group has incurred legal or
constructive obligations to fund an associate’s operations or has made payments on behalf of an associate, which are recognised within
provisions.
When an associate is disposed of in its entirety or partially such that significant influence is lost or classified as an asset held for sale, the
cumulative amount in the foreign currency translation reserve related to that associate is reclassified to the Consolidated Income Statement
as part of the gain or loss on disposal. When the Group disposes of only part of an associate while retaining significant influence, the relevant
proportion of the cumulative amount in the foreign currency translation reserve related to that associate is reclassified to the Consolidated
Income Statement.
The carrying amount of equity accounted investments is tested for impairment in accordance with the policy described in Note 38(G).
iv. Transactions Eliminated on Consolidation
Intra-group transactions, balances and unrealised gains and losses on transactions between controlled entities are eliminated in the
Consolidated Financial Statements. Unrealised gains and losses arising from transactions with investments accounted for under the equity
method are eliminated to the extent of the Group’s interest in the associate.
v. Business Combinations
The Group accounts for business combinations using the acquisition method when the acquired set of activities and assets meets the
definition of a business combination and control is transferred to the Group. In determining whether a particular set of activities and assets is
a business, the Group assesses whether the set of assets and activities acquired includes, at a minimum, an input and substantive process
and whether the acquired set has the ability to produce outputs.
The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets acquired. Any goodwill
that arises is tested annually for impairment. Any gain on bargain purchase is recognised in profit or loss immediately. Transaction costs are
expensed as incurred, except if related to the issue of debt or equity securities.
The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are generally
recognised in the profit or loss.
Note 35 provides further information on the Group’s recent business combination.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(B) FOREIGN CURRENCY
i. Foreign Currency Transactions
Transactions in foreign currencies are translated into the respective functional currencies of the Group’s companies at the exchange rates at
the date of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation
of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognised in the Consolidated
Income Statement.
Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rate at the
reporting date. Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated into the functional
currency at the exchange rate when the fair value was determined. Non-monetary items that are measured based on historical cost in a
foreign currency are translated at the exchange rate at the date of the transactions.
ii. Foreign Operations
The assets and liabilities and the income and expenditure of foreign operations that have a functional currency other than AUD are translated
into AUD as follows:
– Assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet
– Income and expenses for each income statement and statement of comprehensive income are translated at average exchange rates
– All resulting exchange differences are recognised in other comprehensive income and accumulated in the foreign currency translation
reserve, except to the extent that the translation difference is allocated to non-controlling interests.
When a foreign operation is disposed of in its entirety or partially such that control, significant influence or joint control is lost or classified as
an asset held for sale, the cumulative amount in the foreign currency translation reserve related to that foreign operation is reclassified to the
Consolidated Income Statement as part of the gain or loss on disposal. If the Group disposes of part of its interests in a subsidiary but retains
control, then the relevant proportion of the cumulative amount is reattributed to non-controlling interests. When the Group disposes of only
part of an associate or joint venture while retaining significant influence or joint control, the relevant proportion of the cumulative amount is
reclassified to the Consolidated Income Statement.
(C) FINANCIAL INSTRUMENTS
Non-Derivative Financial Instruments
i. Recognition, Measurement and Derecognition of Non-Derivative Financial Assets
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit
or loss, transaction costs related to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through
profit or loss are expensed.
The Group subsequently classifies its financial assets in the following measurement categories:
– Those to be measured subsequently at fair value (either through the Consolidated Income Statement or the Consolidated Statement of
Comprehensive Income)
– Those to be measured at amortised cost.
The Group derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire, are settled or the
Group transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of
ownership are transferred.
ii. Recognition, Measurement and Derecognition of Non-Derivative Financial Liabilities
At initial recognition, the Group measures a non-derivative financial liability at its fair value, less transaction costs.
The Group subsequently measures non-derivative financial liabilities at amortised cost, with any difference between cost and redemption
value being recognised in the Consolidated Income Statement over the period of the borrowings using the effective interest rate method.
The Group derecognises a financial liability when its contractual obligations are discharged, cancelled or expired. The Group also derecognises
a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new
financial liability based on the modified terms is recognised at fair value.
On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any
non-cash assets transferred or liabilities assumed) is recognised in the Consolidated Income Statement.
At initial recognition, the Group measures a non-controlling interest put option financial liability at the present value of the estimated
redemption amount, through equity via the put option reserve. The subsequent remeasurement includes all changes in the carrying amount of
the liability, including the accretion of interest and is recognised in the put option reserve.

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38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(C) FINANCIAL INSTRUMENTS (CONTINUED)
Derivative Financial Instruments
Derivative financial instruments are recognised at fair value both initially and on an ongoing basis. The accounting for subsequent changes in
fair value depends on whether the derivative is a designated hedging instrument, and if so, the nature of the item being hedged and the type
of hedge relationship designated. The Group designates derivatives as either hedges of the fair value of recognised assets or liabilities or a
firm commitment (fair value hedges), or as hedges of a particular risk associated with the cash flows of recognised assets and liabilities or of
highly probable forecast transactions (cash flow hedges). At the inception of the transactions, the Qantas Group documents the economic
relationship between hedging instruments and hedged items, including the risk management objective and strategy for undertaking each
transaction. The Qantas Group also documents its assessment, both at hedge inception and on an ongoing basis, of whether the hedging
instruments that are used in hedge transactions have been and will continue to be highly effective.
From time to time, certain derivative financial instruments do not qualify for hedge accounting, notwithstanding that the derivatives are held
to hedge identified exposures. Any changes in the fair value of a derivative instrument or part of a derivative instrument that do not qualify for
hedge accounting are classified as ineffective and recognised immediately in the Consolidated Income Statement.
i. Fair Value Hedges
Changes in the fair value of derivative financial instruments that are designated and qualify as fair value hedges are recorded in the
Consolidated Income Statement, together with any changes in the fair value of the hedged asset or liability or firm commitment attributable
to the hedged risk.
ii. Cash Flow Hedges
Where a derivative is designated as a cash flow hedging instrument, the effective portion of changes in the fair value of the derivative is
recognised in the Consolidated Statement of Comprehensive Income and accumulated within the hedge reserve. Any ineffective portion of
changes in the fair value of the derivative is recognised immediately in the Consolidated Income Statement.
The amount accumulated in equity is retained in the hedge reserve and reclassified to the Consolidated Income Statement in the same period
or periods during which the hedged forecast cash flows affect profit or loss or the hedged item affects profit or loss. Where the hedged item is
capital in nature, the cumulative gain or loss recognised in the hedge reserve is transferred to the carrying amount of the asset when the
asset is recognised.
If the forecast transaction is no longer highly probable, the hedging instrument expires or is sold, terminated or exercised, or the designation
is revoked, then hedge accounting is de-designated prospectively. In this instance, the amounts accumulated in the hedge reserve are
recognised in the period in which the original hedged item transaction ultimately occurs or reclassified to the Consolidated Income Statement
immediately if the forecast transaction is subsequently considered no longer probable. If the forecast transaction is no longer probable,
hedge accounting is de-designated and the amount accumulated in the hedge reserve is reclassified to the Consolidated Income Statement
immediately.
iii. Cost of Hedging
The time value of an option, the forward element of a forward contract and any foreign currency basis spread is excluded from
the designation of a financial instrument and accounted for as a cost of hedging. The fair value changes of these elements are recognised in
other comprehensive income and depending on the nature of the hedged item, will either be transferred to the Consolidated Income
Statement in the same period that the underlying transaction affects the Consolidated Income Statement or capitalised into the initial
carrying value of the asset.
iv. Fair Value Calculations
The fair value of financial instruments traded in active markets is based on quoted market prices at the balance sheet date. The fair value of
financial instruments that are not traded in an active market is estimated using valuation techniques consistent with accepted market
practice. The Qantas Group uses a variety of methods and input assumptions that are based on market conditions existing at the balance
sheet date. The different methods of estimating the fair value of these items have been defined in the Consolidated Financial Statements
as follows:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or
indirectly (i.e. derived from prices)
Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

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38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(C) FINANCIAL INSTRUMENTS (CONTINUED)
v. Financial Guarantee Contracts
Financial guarantee contracts are recognised as a financial liability at the time the guarantee is issued. The liability is initially measured at
fair value and subsequently at the higher of:
– The amount determined in accordance with the expected credit loss model under AASB 9 Financial Instruments, and
– The amount initially recognised less, where appropriate, the cumulative amount of income recognised in accordance with the principles of
AASB 15 Revenue from Contracts with Customers.
The fair value of financial guarantees is determined based on the present value of the difference in cash flows between the contractual
payments required under the debt instrument and the payments that would be required without the guarantee, or the estimated amount that
would be payable to a third party for assuming the obligations. Where guarantees in relation to loans or other payables of associates are
provided for no compensation, the fair values are accounted for as contributions and recognised as part of the cost of the investment.
(D) REVENUE RECOGNITION
i. Net Passenger and Net Freight Revenue
Net passenger revenue primarily arises within the Qantas Domestic, Qantas International and Jetstar Group segments. Net freight revenue
primarily arises within the Qantas International segment except where belly space is utilised in Qantas Domestic and the Jetstar Group.
Passenger, freight revenue, capacity hire and air charter revenue are recognised when the travel or service is provided. Revenue recognised
on travel is net of sales discounts, passenger and freight interline/IATA commission and the Goods and Services Tax. Net freight revenue
includes amounts the Group receives as operating lease income in relation to freighters leased to customers.
At the time of expected travel, revenue is also recognised in respect of tickets that are not expected to be used. Unused tickets are recognised
as revenue using estimates based on the terms and conditions of the ticket, experience, historical and expected future trends. The Group
generally does not recognise revenue in respect of unredeemed travel credits due to the extended redemption conditions and typically, the
ability for the passenger to request a refund.
Passenger travel and freight services are generally paid for in advance of travel and are deferred on the balance sheet as revenue received in
advance. Travel credits are classified as revenue received in advance where they are available for future flights or in certain circumstances
for refund, if requested. Where customers have made refund claims these are classified as payables, where the balance of refunds is material
in aggregate.
Where the passenger is also a Qantas Frequent Flyer member and earns Qantas Points on travel, the allocation of revenue is on a proportional
basis using relative stand-alone selling prices and the consideration allocated to Qantas Points is deferred as unrecognised redemption
revenue.
Consideration received in relation to certain ancillary services regarding passenger travel such as credit card fees and change fees are not
considered to be distinct from the passenger flight. Revenue relating to these ancillary services is deferred until uplift to align with the related
passenger travel. These amounts are included within net passenger revenue.
Passenger recoveries (including fuel surcharges on passenger tickets) are included in net passenger revenue. Freight fuel surcharge
is included in net freight revenue.
ii. Frequent Flyer Marketing Revenue and Other Qantas Loyalty Businesses
Marketing revenue associated with the issuance of Qantas Points is recognised within the Qantas Loyalty segment as the service is performed
over time (typically this approximates the timing of the issuance of Qantas Points). Marketing revenue is measured as the difference between
the stand-alone selling price of a Qantas Point and the consideration received, using the residual approach. The stand-alone selling price of a
Qantas Point is determined using estimation techniques based on the value of redemption options for which Qantas Points could be redeemed
and considers the proportion of Qantas Points not expected to be redeemed. The consideration for Qantas Points is typically received within
normal credit terms following the issuance of points.
Marketing revenue on inter-segment Qantas Point issuances is eliminated on consolidation.
Revenue from other Qantas Loyalty businesses includes commission revenue where Qantas Loyalty is acting as a sales agent. Commission
revenue is measured based on its relative stand-alone selling price and is recognised on satisfaction of the performance obligation which is
typically the transfer of the underlying good or service to the customer.

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For the year ended 30 June 2022

38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(D) REVENUE RECOGNITION (CONTINUED)
iii. Frequent Flyer Redemption Revenue
The consideration for issuance of Qantas Points is typically received in advance of redemption and is deferred as unrecognised redemption
revenue at its relative stand-alone selling price. Redemption revenue is recognised within the Qantas Loyalty segment when Qantas Points are
redeemed.
Redemption revenue is measured based on the weighted average value of the points redeemed. Redemption revenue arising from Qantas
Group flight redemptions is recognised when the passenger is uplifted and within net passenger revenue on consolidation.
Redemption revenue in relation to products provided by suppliers outside the Group, such as Qantas Reward Store redemptions and other
carrier redemptions, is recognised in the income statement net of related costs where the Group is an agent. For the purposes of segment
reporting, the Qantas Loyalty segment reports these redemptions on a gross basis. Adjustments are made within consolidation eliminations to
present these redemptions on a net basis at a Group level within other revenue. Obligations for returns or refunds in relation to redemptions
from the Qantas Rewards Store are recognised where material.
Significant changes in issued Qantas Points expected to expire unredeemed are recognised within other income. The Group uses estimates
based on terms and conditions of the Frequent Flyer program, experience, historical and expected future trends to determine any amount
recognised.
iv. Other Carrier Commissions and Commissions from Third Parties
The Group considers whether it is a principal or agent in relation to services by considering whether it has a performance obligation to provide
services to the customer or whether the obligation is to arrange for services to be provided by a third party, such as another carrier or a third
party. Other carrier commission revenue is included within third-party services revenue and is generally recognised on uplift by the other
carrier. Consideration for other carrier commissions is received within normal credit terms through IATA. Commissions from third parties are
typically recognised when the underlying good or service has been transferred to the end customer.
v. Freight Terminal Fees
Revenue from freight terminal fees is measured based on its stand-alone selling price and is recognised on satisfaction of the performance
obligation, which is typically the transfer of the underlying service to the customer. Invoices are issued according to contractual terms.
vi. Qantas Club Membership
Qantas Club Membership revenue is measured based on its stand-alone selling price and is recognised on satisfaction of the performance
obligation, which is typically straight-line over the membership period. The deferred revenue is included in other revenue received in advance.
vii. Incremental Costs of Obtaining a Contract
The incremental cost of obtaining a contract is capitalised and amortised over the expected period of benefits to the Group and in line with the
pattern those benefits are expected to arise. The Group recognises the incremental costs of obtaining a contract as an expense when incurred
where the amortisation period of the asset that would have been recognised is one year or less.
(E) GOVERNMENT GRANTS
Grants from the government are recognised at their fair value where there is a reasonable assurance that the grant will be received and the
Group expects to comply with the conditions. Note 24 provides further information on how the Group accounts for government grants.
(F) TAXES
i. Tax Compliance
The Qantas Group is committed to embedding risk management practices to support the achievement of compliance objectives and fulfil
corporate governance obligations. Tax risk management is governed by both the Qantas Group Risk Management Policy and the Qantas Group
Tax Risk Management Policy, ensuring corporate governance obligations with respect to tax risks are met. The Qantas Group has paid all taxes
that it owes and all tax compliance obligations are up to date. The Australian Taxation Office (ATO) has advised that it has a provisional high
level of assurance, that the Qantas Group has paid the right amount of tax, under the ATO Justified Trust Program. The ATO also
acknowledged Qantas’ continued commitment to engage cooperatively and transparently to mitigate tax risks, including obtaining tax
certainty on key transactions through the use of binding Private Rulings and entering into a multi-tax Annual Compliance Arrangement (ACA).
Tax Treaties
Due to the operation of income tax treaties and specific rules dealing with airlines, the Qantas Group appropriately reports the majority of its
income in Australia, with only a small component being reported in foreign jurisdictions (for the purpose of determining liability to company
tax).
Current Income Tax
Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year, and any adjustment to tax payable or
receivable with respect to previous years. It is measured using tax rates enacted or substantially enacted at the balance sheet date where the
Group and its subsidiaries operate and generate taxable income or loss.

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38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(F) TAXES (CONTINUED)
i. Tax Compliance

Deferred Tax
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for taxation purposes. Deferred tax is not recognised for:
– Temporary differences arising from the initial recognition of assets or liabilities that affect neither accounting nor taxable profit or loss
– Temporary differences relating to investments in controlled entities and associates and jointly controlled entities to the extent that they
will probably not reverse in the foreseeable future
– Taxable temporary differences arising on the initial recognition of goodwill.
Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible temporary differences only to the extent that it is
probable that future taxable profits will be available against which they can be used. Deferred tax assets are reviewed at each reporting date
and are reduced to the extent that it is no longer probable that the related tax benefit will be realised. Such reductions are reversed when the
probability of future taxable profits improves. Deferred tax is measured at the tax rates that are expected to be applied to temporary
differences when they reverse, using tax rates enacted or substantially enacted at the reporting date. Qantas provides for income tax in both
Australia and overseas jurisdictions where a liability exists.
Income Tax
Income tax expense comprises current and deferred tax. Income tax expense is recognised in the Consolidated Income Statement except to
the extent that it relates to items recognised directly in equity or in other comprehensive income, in which case it is recognised in equity or in
other comprehensive income.
ii. Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from
the taxation authority. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or as part of the expense.
Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the taxation
authority is included as a current asset or liability in the Consolidated Balance Sheet. The GST components of cash flows arising from
investing and financing activities which are recoverable from, or payable to, the taxation authority are classified as operating cash flows.
iii. Tax Consolidation
Qantas and its Australian wholly-owned controlled entities, trusts and partnerships are part of a tax consolidated group. As a consequence, all
members of the tax consolidated group are taxed as a single entity.
(G) IMPAIRMENT
i. Non-Financial Assets
The carrying amounts of non-financial assets such as equity accounted investments, property, plant and equipment, goodwill and intangible
assets and other assets are reviewed at each balance sheet date to determine whether there is any indication of impairment.
Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment, or
more frequently if events or changes in circumstances indicate that they might be impaired. For the purpose of assessing impairment,
goodwill and indefinite lived intangible assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash
generating units). Other assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount
may not be recoverable.
Assets which primarily generate cash flows as a group, such as aircraft, are typically assessed on a cash generating unit (CGU) basis,
inclusive of related infrastructure and intangible assets and compared to net cash inflows for the CGU. Where assets are no longer expected
to contribute to the cash flows of a CGU, they are tested for impairment separately. Identification of an asset’s CGU requires significant
judgement, as it requires identification of the lowest aggregation of assets that generate largely independent cash inflows. In Management’s
judgement, the lowest aggregation of assets which give rise to CGUs as defined by AASB 136 Impairment of Assets are the Qantas Domestic
CGU, Qantas International CGU, Qantas Loyalty CGU, Qantas Freight CGU, Jetstar Asia CGU, Jetstar Japan CGU and the Jetstar Australia/New
Zealand CGU. Estimated net cash flows used in determining recoverable amounts are discounted to their net present value using a pre-tax
discount rate that reflects current market assessments of the time value of money and the risks specific to the assets or CGU.
An impairment loss is recognised for the amount by which the asset’s or CGU’s carrying amount exceeds its recoverable amount. The
recoverable amount is the higher of an asset’s or CGU’s fair value less costs of disposal and value in use. Impairment loss is recognised in the
Consolidated Income Statement.
Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each
reporting period. The maximum amount of any impairment reversal is the lower of:
– The amount necessary to bring the carrying amount of the asset to its recoverable amount (if it is determinable), and
– The amount necessary to restore the assets of the CGU to their pre-impairment carrying amounts less subsequent depreciation or
amortisation that would have been recognised.

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38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(G) IMPAIRMENT (CONTINUED)
ii. Financial Assets
The carrying value of financial assets is assessed at each reporting date to determine whether there is any objective evidence that it is
impaired. Where necessary, the Group recognises provisions for expected credit loss (ECL) at amortised cost, based on 12-month or lifetime
losses depending on whether there has been a significant increase in credit risk, including risk of default occurring, since initial recognition.
For significant customers, the Group allocates each exposure to a credit risk grade based on data that is determined to be predictive of the
risk of loss (including but not limited to external ratings, audited financial statements, management accounts and cash flow projections and
available press information about customers) and applying experienced credit judgement. For other customers, ECL is assessed based on
credit risk characteristics and the days past due. It is then measured based on actual historical credit loss experienced over the past years,
along with other factors, to reflect differences between the economic conditions during the period over which the historical data has been
collected, current conditions and the Group's view of macroeconomic conditions over the expected lives of the receivables. The Group
considers a financial asset to be in default when the counterparty is unlikely to pay its credit obligations in full.
When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating ECL,
the Group considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both
quantitative and qualitative information and analysis, based on the Group's historical experience and informed credit assessment, including
forward-looking information. A financial asset is written off when there is no reasonable expectation of recovery, such as the debtor failing to
engage in a repayment plan with the Group.
(H) PROPERTY, PLANT AND EQUIPMENT
i. Recognition and Measurement
Items of property, plant and equipment are stated at cost less accumulated depreciation and impairment losses. Items of property, plant and
equipment are initially recorded at cost, being the fair value of the consideration provided plus incidental costs directly attributable to the
acquisition.
Costs to dismantle and remove assets
The cost of acquired assets includes the initial estimate of costs of dismantling and removing the items and restoring the site on which they
are located. Changes in the measurement of existing liabilities resulting from changes in foreign exchange rates, timing or expected outflow
of resources required to settle the obligation, or from changes in the discount rate are recognised as an adjustment to the asset recognised.
The unwinding of the discount is treated as a finance expense in the Consolidated Income Statement.
Gains or losses on cash flow hedges of the purchase of assets
The cost also may include transfers from the hedge reserve of any gain or loss on qualifying cash flow hedges of foreign currency purchases
of property, plant and equipment in accordance with Note 38(C).
Capitalisation of interest
Interest attributed to progress payments made on account of aircraft and other qualifying assets under construction are capitalised and
added to the cost of the asset. All other borrowing costs are recognised in the Income Statement in the year in which they are incurred.
ii. Subsequent Expenditure
Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to the
Group.
iii. Depreciation
Depreciation is provided on a straight-line basis on all items of property, plant and equipment except for freehold land, which is not
depreciated. The depreciation rates of owned assets are calculated to allocate the cost or valuation of an asset, less any estimated residual
value, over the asset’s estimated useful life to the Qantas Group. Assets are depreciated from the date of acquisition or, with respect to
internally constructed assets, from the time an asset is available for use. The costs of improvements to assets are depreciated over the
shorter of the remaining useful life of the asset or the estimated useful life of the improvement.
The principal asset depreciation periods and estimated residual value percentages applied where material are:
Years Residual Value (%)
Buildings and leasehold improvements 0 – 40 0
Plant and equipment 2.5 – 20 0
Passenger aircraft and engines 2.5 – 25 0 – 10
Freighter aircraft and engines 2.5 – 20 0 – 10
Aircraft spare parts 2 – 20 0 – 10
Useful lives and residual values are reviewed annually and adjusted where appropriate, having regard to commercial and technological
developments, the estimated useful life of assets to the Qantas Group and the long-term fleet plan.

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38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(H) PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
iv. Maintenance and Overhaul Costs

Embedded Maintenance
An element of the cost of an acquired aircraft is attributed to its service potential, reflecting the maintenance condition of its engines and
airframe. This cost is depreciated over the shorter of the period to the next major inspection event, the remaining life of the asset or the
remaining lease term.
Subsequent Maintenance Expenditure
The costs of subsequent major cyclical maintenance checks for owned and leased aircraft are recognised as an asset and depreciated over
the shorter of the scheduled usage periods to the next major inspection event, the remaining life of the aircraft or lease term (as appropriate
to their estimated residual value). Maintenance checks which are covered by third-party maintenance agreements where there is a transfer of
risk and legal obligation are expensed on the basis of hours flown. All other maintenance costs are expensed as incurred.
Modifications
Modifications that enhance the operating performance or extend the useful lives of aircraft are capitalised and depreciated over the
remaining estimated useful life of the asset or remaining lease term (as appropriate to their estimated residual value).
v. Manufacturers’ Credits
The Qantas Group receives credits from manufacturers in connection with the acquisition of certain aircraft and engines. These credits are
recorded as a reduction to the cost of the related aircraft and engines, when the credits are utilised by the Group.
(I) LEASES
The Group predominantly leases passenger aircraft and engines, freighter aircraft, domestic and international properties, and equipment.
Lease contracts are typically entered into for fixed periods but may have extension options.
i. Initial Recognition
Leases (other than those described below) are recognised as a lease liability with a corresponding right of use asset at the date at which the
leased asset is available for use by the Group.
Scope
AASB 16 applies to contracts which convey the right to control the use of an identified asset for a period of time in exchange for consideration.
Control is conveyed where the Group has both the right to direct the use of the identified asset and to obtain substantially all the economic
benefits from the use of the asset throughout the period of use.
Short-term leases (expected lease term of 12 months or less from the commencement date and that do not contain a purchase option) and
leases of low value assets are not recognised as lease liabilities. Lease payments on short-term leases and leases of low value assets are
recognised as an expense in the Consolidated Income Statement as incurred.
For contracts that include lease components and non-lease components, these are separated based on their relative stand-alone selling
prices. The lease component is recognised as a lease under AASB 16 and the non-lease component is recognised as an expense in the
Consolidated Income Statement as incurred. This includes, for example, certain capacity hire arrangements where a third party provides
aircraft (lease component) to the Group, together with other services such as crew and maintenance (non-lease components), which are
recognised within capacity hire expense.
Lease Liability
At the lease commencement date, lease liabilities are initially measured at the present value of lease payments over the lease term.
Lease payments include fixed payments (less any lease incentives receivable), variable payments that are based on an index or a rate
(initially measured using the index or rate as at the commencement date) and, where relevant, the exercise price of a purchase option (where
it is reasonably certain that option will be exercised).
The lease term includes the non-cancellable period for which the Group has contracted to lease the asset, together with any option terms to
extend the lease if it is reasonably certain to be exercised, or any periods covered by an option to terminate the lease, if it is reasonably
certain not to be exercised. When determining the lease term for cancellable leases or renewable leases, the Group considers both the broader
economics of the contract (and not only contractual termination payments) and whether each of the parties has the right to terminate the
lease without permission from the other party with no more than an insignificant penalty. Such leases include, for example, leases which have
expired and are legally cancellable by both the lessor and lessee and/or leases which contain holdover arrangements which allow the lessee
to continue to occupy the property beyond the lease end date until the arrangement is cancelled by either the lessee or the lessor.
Lease payments are discounted using the Group's incremental borrowing rate where the implicit interest rate in the lease is not readily
determined. The Group's incremental borrowing rate is the rate that the Group would have to pay to borrow the funds necessary to obtain an
asset of similar value or the right to use an asset in an economic environment with similar terms and conditions.

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38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(I) LEASES (CONTINUED)
i. Initial Recognition (continued)

Right of Use Asset

At the lease commencement date, right of use assets are measured at an amount equal to the initial measurement of the lease liability
(adjusted for any lease payments made at or before the commencement date), and an initial estimate of the present value of restoration or
return costs that arise at lease commencement (with the corresponding amount recognised as a provision under AASB 137 Provisions,
Contingent Liabilities and Contingent Assets), less any lease incentives received.
ii. Subsequent Measurement

Lease Liability
Lease payments are allocated between principal and interest payments. The interest expense is recognised in the Consolidated Income
Statement over the lease term to produce a constant periodic rate of interest on the remaining balance of the liability for each period.
Lease liabilities denominated in currencies other than the Group's functional currency are translated to Australian dollars at each reporting
date. However, the right of use asset is recognised at the foreign exchange rate at initial recognition.
In accordance with the Group's Treasury Risk Management Policy, certain foreign currency lease liabilities (for example, aircraft leases
denominated in US dollars) have been designated as a hedging instrument of future corresponding foreign currency revenues (for example,
US dollar revenues) in a cash flow hedge relationship. The effective portion of the foreign exchange revaluation of the lease liability is
recognised in other comprehensive income and is recycled to the Consolidated Income Statement within net passenger revenue when the
hedged item is realised.
The lease liability is remeasured where there is a change in future lease payments arising from a change in index or rate, if there is a change
in the Group's estimate of amounts expected to be payable under a residual value guarantee, or if there is a change in the lease term,
including the Group’s assessment of whether it will exercise a purchase, extension or termination option within the lease contract (reassessed
where there is a significant event or change in circumstances that is within the Group's control and affects the ability to exercise, or not to
exercise, an option). Where the lease liability is remeasured in this way, a corresponding adjustment is recognised to the right of use asset or
is recorded in the Consolidated Income Statement if the carrying amount of the right of use asset has been reduced to zero.
Right of Use Asset
Right of use assets are generally depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis. The right of
use asset is adjusted for certain changes in the lease liability. The right of use asset is also adjusted for changes in the measurement of the
restoration provision recognised for return costs that arise at lease commencement.
iii. Amendment to AASB 16
In May 2020, the IASB issued amendments to AASB 16 to provide an optional relief to lessees from applying AASB 16’s guidance on lease
modification accounting for rent concessions if they are a direct consequence of COVID-19 and meet certain conditions specified in the
amendment. On 31 March 2021, the IASB extended the period of application of the practical expedient up until 30 June 2022 (originally
30 June 2021). The practical expedient allows the lessee to recognise a forgiveness or waiver of lease payments as a variable lease payment
in the income statement and a corresponding derecognition of the part of the lease liability that has been extinguished by the forgiveness or
waiver of lease payments. The practical expedient also provides guidance on accounting for rent deferrals whereby a change in lease
payment that reduces the payment in one period and proportionally increases the payment in another does not extinguish the lessee’s lease
liability nor changes the consideration for the lease. The lessee would continue to recognise lease payment deferrals within the lease liability.
The Group has determined that it meets the conditions to apply the practical expedient and has applied the practical expedient in accounting
for rent concessions. The impact of the application of this practical expedient is disclosed in Note 16.
iv. Lease Revenue
When the Group acts as a lessor, it determines at lease inception whether each lease is a finance lease or an operating lease. To classify each
lease, the Group makes an overall assessment of whether the lease transfers substantially all of the risks and rewards incidental to
ownership of the underlying asset. If this is the case, then the lease is a finance lease, if not, then it is an operating lease. As part of this
assessment, the Group considers certain indicators such as whether the lease is for the major part of the economic life of the asset.
Where the Group is an intermediate lessor, it accounts for its interests in the head lease and the sub-lease separately. It assesses the lease
classification of a sub-lease with reference to the right to use asset arising from the head lease, not with reference to the underlying asset. If
a head lease is a short-term lease to which the Group applies the exemption described above, then it classifies the sub-lease as an operating
lease. The Group recognises lease payments received under operating leases as income on a straight-line basis over the lease term within net
freight revenue and other revenue and income.
v. Sale and Leaseback
A sale and leaseback transaction is one where the Group sells an asset in accordance with AASB 15 Revenue from Contracts with Customers,
and simultaneously reacquires the use of the asset by entering into a lease with the buyer.
The Group measures the right of use asset arising from the leaseback at the portion of the previous carrying amount that is retained by the
Group, with any difference between the right of use asset and the lease liability reflected in the gain on sale. Accordingly, any residual gain
from the disposal of assets is representative of the rights transferred to the buyer and is recognised in the Consolidated Income Statement.

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For the year ended 30 June 2022

38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(J) INTANGIBLE ASSETS
i. Recognition and Measurement

Goodwill Goodwill has an indefinite useful life and is stated at cost less any accumulated impairment losses. With respect to
investments accounted for under the equity method, the carrying amount of goodwill is included in the carrying
amount of the investment.
Airport landing slots Airport landing slots have an indefinite useful life. Airport landing slots are not amortised and are stated at cost less
any accumulated impairment losses.
Brand names and Brand names and trademarks have an indefinite useful life and are carried at cost less any accumulated
trademarks impairment losses.
Software Software is stated at cost less accumulated amortisation and impairment losses. Software development
expenditure, including the cost of materials, direct labour and other direct costs, is only recognised as an asset
when the Qantas Group controls future economic benefits as a result of the costs incurred and it is probable that
those future economic benefits will eventuate and the costs can be measured reliably.
Cloud computing arrangements involve service contracts providing the Group with the right to access the cloud
provider’s application software over the contract period. Where the Group does not receive a software intangible
asset at the contract commencement date, costs incurred for the customisation and configuration are generally
recognised as an expense when the work is performed. Fees for use of the underlying software are recognised as
the service is provided over the contract period.
Contract intangible Contract intangible assets are stated at cost less accumulated amortisation. Amortisation commences when the
assets asset is ready for use.
The Group considers that there are no individual intangible assets that are material for additional disclosure within the financial statements.
ii. Subsequent Expenditure
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates.
All other expenditure, including expenditure on internally-generated goodwill and brands, is recognised in the Consolidated Income Statement
as incurred.
iii. Amortisation
Amortisation is calculated to write off the cost of intangible assets less their estimated residual values using the straight-line method over
their estimated useful lives and is recognised in the Consolidated Income Statement. Goodwill, brand names and trademarks and airport
landing slots are indefinite lived intangible assets and are allocated to the relevant CGU. These indefinite lived intangible assets are not
amortised but tested annually for impairment. Contract intangible assets are not amortised until such time as the intangible asset is ready for
use but are tested annually for impairment.
The principal amortisation periods and estimated residual value percentages applied where material is:

Years Residual Value %

Software 2 – 10 years 0%
Contract intangible assets 0 – 40 years 0%

(K) INVENTORIES
Inventories are valued at the lower of cost and net realisable value. The cost is determined by the weighted average cost method. Inventories
include mainly engineering expendables, consumable stores and work-in-progress.
(L) PAYABLES
These amounts represent liabilities for goods and services provided to the group prior to the end of the financial year which are unpaid. The
amounts are unsecured and are usually paid within 30-60 days of recognition. Trade and other payables are presented as current liabilities
unless payment is not due within 12 months after the reporting period. They are recognised initially at their fair value and subsequently
measured at amortised cost using the effective interest method, if the effect of discounting is material.
(M) PROVISIONS
A provision is recognised if, as a result of a past event, there is a present legal or constructive obligation that can be measured reliably, and it
is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are not recognised for future operating
losses.
If the effect is material, a provision is determined by discounting the best estimate of the expected future cash flows required to settle the
obligation at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The
unwinding of the discount is treated as a finance expense in the Consolidated Income Statement.
Obligations are presented as current liabilities in the balance sheet if the Group does not have an unconditional right to defer settlement for at
least 12 months after the reporting period, regardless of when the actual settlement is expected to occur.

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For the year ended 30 June 2022

38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(M) PROVISIONS (CONTINUED)

Wages, salaries and Liabilities for wages, salaries and annual leave vesting to employees are recognised in respect of employees’
annual leave services up to the end of the reporting period. These liabilities are measured at the amounts expected to be paid
when they are settled and include related on-costs, such as workers’ compensation insurance, superannuation
and payroll tax. The annual leave provision is discounted using corporate bond rates which most closely match the
expected settlement dates of the provision.
Long service leave The liability for long service leave is recognised as a provision for employee benefits and measured at the present
value of estimated future payments to be made in respect of services provided by employees up to the end of the
reporting period. The provision is calculated using expected future increases in wage and salary rates including
related on-costs and expected settlement dates based on expected employee usage. The provision is discounted
using corporate bond rates which most closely match the expected settlement dates of the provision. The
unwinding of the discount is treated as a finance expense in the Consolidated Income Statement.
Remeasurements as a result of experience adjustments and changes in assumptions are recognised in the
Consolidated Income Statement.
Redundancies and Redundancy provisions are recognised as an expense at the earlier of when the Group can no longer withdraw the
other employee benefits offer of those benefits and when the Group recognises costs for a restructuring. These benefits are expected to be
settled wholly within 12 months of the end of the reporting period.
Other employee benefits such as discretionary bonus amounts due to non-executive employees are recognised as
a provision where the Group has a legal or constructive obligation to make the payment to non-executive
employees and the amount can be reliably measured.
Onerous contracts An onerous contract is a contract in which the unavoidable cost of meeting the obligations under the contract
exceeds the economic benefit expected to be received.
A provision for onerous contracts is measured at the present value of the lower of the expected cost of terminating
the contract and the expected net cost of continuing with the contract. Before a provision is established, the Group
recognises any impairment loss on the assets associated with that contract.
Make good on Aircraft: An initial estimate of the present value of restoration or return costs that arise at lease commencement
leased assets are recognised as a provision with a corresponding amount recognised as part of the initial recognition of the right
of use asset and depreciated over the lease term. Changes in this provision are recognised as an adjustment to
the right of use asset.
Provisions for return costs that occur over the lease term through usage or the passage of time are recognised as
an expense when they occur. The determination of provisions for return costs requires significant judgement and
is estimated in USD based on the forecast costs expected to be incurred when the aircraft is returned to or
purchased from the lessor, calculated using expected future increases in costs and discounted to present value
using the Group’s incremental borrowing rate. The expense is recognised pro-rata over the period to an expected
lease return date. Movements in the provision due to changes in foreign exchange rates and discount rates as well
as changes in estimates of forecast return costs expected to be incurred or expected lease return dates are
recognised in the Consolidated Income Statement.
Property and environment: An initial estimate of the present value of restoration costs that arise at lease
commencement are recognised as a provision with a corresponding amount recognised as part of the initial
recognition of the right of use asset and depreciated over the lease term. Changes in this provision are recognised
as an adjustment to the right of use asset.
Where the usage of property or land gives rise to an obligation for rehabilitation, the Group recognises a provision
for the costs associated with restoration.
Insurance, legal Insurance: The Qantas Group self-insures for risks associated with workers’ compensation in certain jurisdictions.
and other Qantas has made a provision for all notified and assessed workers’ compensation liabilities, together with an
estimate of liabilities incurred but not reported, based on an independent actuarial assessment. The provision is
discounted using pre-tax rates that reflect current market assessments of the time value of money and the risks
specific to the liabilities and which have maturity dates approximating the terms of Qantas’ obligations. Workers’
compensation for all remaining employees is commercially insured.
Legal and other provisions: These are recognised where they are incurred as a result of a past event, there is a legal
or constructive obligation that can be measured reliably, and it is probable that an outflow of economic benefits
will be required to settle the obligation.

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For the year ended 30 June 2022

38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(N) OTHER EMPLOYEE BENEFITS

Employee share plans

The grant date fair value of equity-settled share-based payment awards granted to employees is recognised as an expense, with a
corresponding increase in equity, over the vesting period of the awards. The amount recognised as an expense is adjusted to reflect the
number of awards for which related service and non-market performance conditions are expected to be met, such that the amount ultimately
recognised is based on the number of awards that meet the related service and non-market performance conditions at the vesting date. For
share-based payment awards with market performance conditions, the grant date fair value of the share-based payment is measured to
reflect such conditions and there is no true-up for differences between expected and actual outcomes.
The fair value of equity-based entitlements settled in cash is recognised as an employee expense with a corresponding increase in liability
over the period during which employees unconditionally become entitled to payment. The liability is remeasured at each reporting date and at
settlement date based on the fair value. Any changes in the fair value of the liability are recognised as an employee expense in the
Consolidated Income Statement.
Defined contribution superannuation plans
The Qantas Group contributes to employee defined contribution superannuation plans. Contributions to these plans are recognised as an
expense in the Consolidated Income Statement as incurred.
Defined benefit superannuation plans
The Qantas Group’s net obligation with respect to defined benefit superannuation plans is calculated separately for each plan. The Qantas
Superannuation Plan has been split based on the divisions which relate to accumulation members and defined benefit members. Only defined
benefit members are included in the Qantas Group’s net obligation calculations. The calculation estimates the amount of future benefit that
employees have earned in return for their service in the current and prior periods, which is discounted to determine its present value, and the
fair value of any plan assets is then deducted.
The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method. When the
calculation results in a potential asset for the Group, the recognised asset is limited to the present value of economic benefits available in the
form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits,
consideration is given to any applicable minimum funding requirements.
Remeasurements of the net defined benefit liability or asset, which comprise actuarial gains and losses, the return on plan assets (excluding
interest) and the effect of the asset ceiling, are recognised immediately in other comprehensive income. The Group determines the net
interest expense/(income) on the net defined benefit liability/(asset) for the period by applying the discount rate used to measure the defined
benefit obligation at the beginning of the annual period to the then net defined benefit liability/(asset), taking into account any changes in the
net defined benefit liability/(asset) during the period as a result of contributions and benefit payments. Net interest expense and other
expenses related to defined benefit plans are recognised in the Consolidated Income Statement.
The discount rate used is the corporate bond rate which has a maturity date that approximates the expected terms of Qantas’ obligations.
Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are recognised immediately in
the Consolidated Income Statement as past service costs. The Group recognises gains and losses on the settlement of a defined benefit plan
when the settlement occurs.
(O) NET FINANCE COSTS
Net finance costs comprise interest payable on borrowings calculated using the effective interest method, unwinding of the discount rate on
lease liabilities, provisions and receivables, interest receivable on funds invested and gains and losses on mark-to-market movements in fair
value hedges.
Finance income is recognised in the Consolidated Income Statement as it accrues, using the effective interest method.
Finance costs are recognised in the Consolidated Income Statement as incurred, except where interest costs relate to qualifying assets, in
which case they are capitalised to the cost of the assets. Qualifying assets are assets that necessarily take a substantial period of time to be
made ready for intended use. Where funds are borrowed generally, borrowing costs are capitalised using the average interest rate applicable
to the Qantas Group’s debt facilities.

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For the year ended 30 June 2022

38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(P) CAPITAL AND RESERVES
i. Ordinary Shares
Ordinary shares are classified as equity. Incremental costs directly attributable to issue of ordinary shares are recognised as a deduction from
equity, net of tax.
ii. Repurchase of Share Capital
When share capital recognised as equity is repurchased, the amount of the consideration paid, including directly attributable costs, is
recognised as a deduction from equity.
iii. Treasury Shares
Shares purchased and held by the Qantas-sponsored Employee Share Plan Trust are recognised as treasury shares at their purchase price
and deducted from equity on the purchase date.
iv. Employee Compensation Reserve
The fair value of equity plans granted is recognised in the employee compensation reserve over the vesting period. This reserve will
be reversed against treasury shares when the underlying shares vest and transfer to the employee at the fair value. The difference between
the fair value at grant date and the cost of treasury shares used is recognised in retained earnings (net of tax).
v. Hedge Reserve
The hedge reserve comprises the effective portion of the cumulative net change in the fair value of cash flow hedging instruments and the
cumulative change in fair value arising from the time value of options related to future forecast transactions. Gains or losses relating to
ineffective portions are recognised immediately in the Consolidated Income Statement.
The amounts within the hedge reserve are reclassified to the Consolidated Income Statement in the same period or periods during which the
hedged forecast cash flows affect profit or loss or the hedged item affects profit or loss. Where the hedged item is capital in nature, the
cumulative gain or loss recognised in the hedge reserve is transferred to the carrying amount of the asset when the asset is recognised. If the
forecast transaction is no longer highly probable, the hedging instrument expires or is sold, terminated or exercised, or the designation is
revoked, then hedge accounting is de-designated prospectively. In this instance, the amounts accumulated in the hedge reserve are
recognised in the period in which the original hedged item transaction ultimately occurs or reclassified to the Consolidated Income Statement
immediately if the forecast transaction is subsequently considered no longer probable. If the forecast transaction is no longer probable,
hedge accounting is de-designated and the amount accumulated in the hedge reserve is reclassified to the Consolidated Income Statement
immediately.
vi. Foreign Currency Translation Reserve
The foreign currency translation reserve comprises all foreign exchange differences arising from the translation of the Financial Statements
of foreign controlled entities and investments accounted for under the equity method.
vii. Other Reserves
Other reserves includes following:
– The defined benefit reserve, comprising the remeasurements of the net defined benefit asset/(liability), which is recognised in other
comprehensive income in accordance with AASB 119 Employee Benefits
– The fair value reserve, comprising the fair value gains/(losses) on investments at fair value through other comprehensive income
– The put option reserve, comprising the recognition and remeasurements of a put option liability over relevant non-controlling interests,
which is recognised in equity, in accordance with AASB 10 Consolidated Financial Statements
viii. Dividends
A provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the Group, on or
before the end of the reporting period but not distributed at the end of the reporting period. Where the Group has revoked a declared dividend,
it is no longer recognised as a provision.
(Q) COMPARATIVES
Where applicable, comparative balances have been reclassified to align with current year presentation.

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For the year ended 30 June 2022

38 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(R) SEGMENT REPORTING
Operating segments are reported in a manner consistent with the internal reporting provided to the CODM, being the Chief Executive Officer,
Group Management Committee and the Board of Directors.
Underlying EBIT is the primary reporting measure used by the CODM for the purpose of assessing the performance of the operating segments,
with the exception of the Corporate segment which is assessed using Underlying PBT. Underlying EBIT of the Qantas Group’s operating
segments is prepared and presented on the basis that it reflects the revenue earned and the expenses incurred by each operating segment.
The significant accounting policies applied in implementing this basis of preparation are set out below. These accounting policies have been
consistently applied to all periods presented in the Consolidated Financial Statements.
Segment Performance
Measure Basis of Preparation
External segment External segment revenue is reported by operating segments as follows:
revenue – Net passenger revenue is reported by the operating segment that operated the relevant flight or provided
the relevant service. For Qantas Airlines, where a multi-sector ticket covering international and domestic
travel is sold, the revenue is reported by Qantas International and Qantas Domestic on a pro-rata basis
using an industry standard allocation process
– Other revenue is reported by the operating segment that earned the revenue.
Inter-segment Inter-segment revenue for Qantas Domestic, Qantas International and Jetstar Group operating segments
revenue primarily represents:
– Net passenger revenue arising from the redemption of Frequent Flyer points for Qantas Group flights by
Qantas Loyalty
– Net freight revenue from the utilisation of Qantas Group’s aircraft belly space.
Inter-segment revenue for Qantas Loyalty primarily represents marketing revenue arising from the issuance of
Frequent Flyer points to Qantas Domestic, Qantas International and Jetstar Group. Inter-segment revenue
transactions, which are eliminated on consolidation, occur in the ordinary course of business at prices that
approximate market prices. The inter-segment arrangements with Qantas Loyalty are not designed to derive a
net profit from inter-segment Frequent Flyer point issuances and redemptions.
Share of net profit/(loss) of Share of net profit/(loss) of investments accounted for under the equity method is reported by the operating
investments accounted for segment that is accountable for the management of the investment. The share of net profit/(loss) of
under the equity method investments accounted for under the equity method for Qantas Airlines’ investments has been equally shared
between Qantas Domestic and Qantas International.
Underlying EBITDA The significant expenses impacting Underlying EBITDA are as follows:
– Manpower and staff-related costs are reported by the operating segment that utilises the manpower. Where
manpower supports both Qantas Domestic and Qantas International, costs are reported by using an
appropriate allocation methodology
– Fuel expenditure is reported by the segment that consumes the fuel in its operations
– Aircraft operating variable costs are reported by the segment that incurs these costs
– All other expenditure is reported by the operating segment to which it is directly attributable or, in the case
of Qantas Airlines, between Qantas Domestic and Qantas International using an appropriate allocation
methodology.
To apply this accounting policy, where necessary, expenditure is recharged between operating segments as a
cost recovery.
The impact of discount rate changes on provisions are not allocated to operating segments, and changes in
presentation of income/expenses where the determination of whether the Group is acting as principal or agent
is made on consolidation.
Depreciation and Qantas Domestic, Qantas International and Jetstar Group report depreciation expenses for passenger and
amortisation freight aircraft owned or leased by the Qantas Group and flown by the segment. Other depreciation and
amortisation is reported by the segment that uses the related asset.

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Notes to the Financial Statements continued

For the year ended 30 June 2022

39 NEW STANDARDS AND INTERPRETATIONS ADOPTED BY THE GROUP

IFRIC AGENDA DECISION IN RELATION TO CONFIGURATION OR CUSTOMISATION COSTS IN A CLOUD COMPUTING ARRANGEMENT
IFRIC Cloud Computing Arrangement Decision
IFRIC published a final agenda decision in April 2021 in relation to the capitalisation of costs associated with cloud computing arrangements,
which provided new guidance and requirements in assessing whether costs incurred to implement these arrangements were capitalised as
intangible assets.
The Group’s accounting policy has historically been to capitalise costs related to cloud computing arrangements in line with prevailing
accounting standards and interpretations, where they meet the relevant criteria for capitalisation.
As a result of the final agenda decision and new guidance, the Group is required to retrospectively apply the decision as a change in
accounting policy, and instead expense certain costs relating to cloud computing arrangements or, in certain circumstances, to defer these
expenses as a prepayment and recognise them over the term of the cloud computing arrangement.
This has resulted in the restatement of the Consolidated Balance Sheet at 30 June 2020 and 30 June 2021, and the Consolidated Income
Statement and the Operating Segment results for the year ended 30 June 2021. There was no impact to the Consolidated Cash Flow
Statement for the year ended 30 June 2021.
The new accounting policy is presented in Note 38(J)i.

Application of the new guidance

In applying the new accounting policy, Management has made the following key judgements that may have the most significant effect on the
amounts recognised in the Consolidated Financial Statements:
Determining whether configuration and customisation services are distinct from the access to the cloud provider’s application software
Implementation costs, including costs to configure or customise the cloud provider's application software, are generally recognised as an
expense when the services are received.
Where the cloud computing service supplier provides the configuration and/or customisation services, judgement has been applied to
determine whether or not these services are distinct from the underlying use of the cloud provider’s application software.
Distinct configuration and/or customisation costs are expensed as incurred, which is typically upfront, as the software is configured,
customised or integrated. Distinct configuration and/or customisation costs are costs incurred by the Qantas Group or third parties engaged
by the Group to implement or integrate a cloud computing arrangement.
Non-distinct configuration and/or customisation costs are expensed over the cloud computing contract term, as these are typically
performed by the cloud provider and are not separable from the cloud computing arrangement itself. Non-distinct customisation activities
significantly enhance or modify a cloud-based application. Judgement has been applied in determining whether the degree of customisation
and modification of the cloud-based application is significant or not.
Capitalisation of configuration and customisation costs in cloud computing arrangements
In implementing cloud computing arrangements, the Group may develop software code that either enhances, modifies or creates additional
capability to the Group’s existing controlled software. This software code may, for example, be used to connect with the cloud-based
application to existing controlled software. Where the costs incurred are unique to the cloud computing arrangement and do not provide the
Group with any further benefits in another cloud arrangement and do not significantly enhance existing controlled software, these are
expensed as incurred.
Judgement has been applied in determining whether the changes to the controlled software meet the definition of and recognition criteria for
an intangible asset in accordance with AASB 138 Intangible Assets.

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For the year ended 30 June 2022

39 NEW STANDARDS AND INTERPRETATIONS ADOPTED BY THE GROUP (CONTINUED)

IFRIC AGENDA DECISION IN RELATION TO CONFIGURATION OR CUSTOMISATION COSTS IN A CLOUD COMPUTING ARRANGEMENT (CONTINUED)
(A) CONSOLIDATED BALANCE SHEET RESTATEMENT
The impact on the Consolidated Balance Sheet as at 30 June 2020 is:
IFRIC Cloud Computing 30 June 2020
30 June 2020 Decision (restated)
$M $M $M
CURRENT ASSETS
Cash and cash equivalents 3,520 — 3,520
Receivables 520 — 520
Lease receivables 2 — 2
Other financial assets 216 — 216
Inventories 306 — 306
Assets classified as held for sale 58 — 58
Income tax receivable 137 — 137
Other 193 — 193
Total current assets 4,952 — 4,952
NON-CURRENT ASSETS
Receivables 101 — 101
Lease receivables 23 — 23
Other financial assets 139 — 139
Investments accounted for under the equity method 59 — 59
Property, plant and equipment 11,726 — 11,726
Right of use assets 1,440 — 1,440
Intangible assets 1,050 (156) 894
Deferred tax assets 167 47 214
Other 369 — 369
Total non-current assets 15,074 (109) 14,965
Total assets 20,026 (109) 19,917
CURRENT LIABILITIES
Payables 2,351 — 2,351
Revenue received in advance 2,784 — 2,784
Interest-bearing liabilities 868 — 868
Lease liabilities 524 — 524
Other financial liabilities 238 — 238
Provisions 1,539 — 1,539
Total current liabilities 8,304 — 8,304
NON-CURRENT LIABILITIES
Payables 99 — 99
Revenue received in advance 2,256 — 2,256
Interest-bearing liabilities 5,825 — 5,825
Lease liabilities 1,318 — 1,318
Other financial liabilities 47 — 47
Provisions 651 — 651
Total non-current liabilities 10,196 — 10,196
Total liabilities 18,500 — 18,500
Net assets 1,526 (109) 1,417
EQUITY
Issued capital 3,104 — 3,104
Treasury shares (51) — (51)
Reserves (173) — (173)
Accumulated losses (1,357) (109) (1,466)
Equity attributable to members of Qantas 1,523 (109) 1,414
Non-controlling interests 3 — 3
Total equity 1,526 (109) 1,417

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For the year ended 30 June 2022

39 NEW STANDARDS AND INTERPRETATIONS ADOPTED BY THE GROUP (CONTINUED)

IFRIC AGENDA DECISION IN RELATION TO CONFIGURATION OR CUSTOMISATION COSTS IN A CLOUD COMPUTING ARRANGEMENT (CONTINUED)
(A) CONSOLIDATED BALANCE SHEET RESTATEMENT (CONTINUED)
The impact on the Consolidated Balance Sheet as at 30 June 2021 is:
IFRIC Cloud Computing 30 June 2021
30 June 2021 Decision (restated)
$M $M $M
CURRENT ASSETS
Cash and cash equivalents 2,221 — 2,221
Receivables 579 — 579
Lease receivables 5 — 5
Other financial assets 176 — 176
Inventories 279 — 279
Assets classified as held for sale 1 — 1
Other 169 — 169
Total current assets 3,430 — 3,430
NON-CURRENT ASSETS
Receivables 54 — 54
Lease receivables 47 — 47
Other financial assets 185 — 185
Investments accounted for under the equity method 57 — 57
Property, plant and equipment 10,787 — 10,787
Right of use assets 1,109 — 1,109
Intangible assets 849 (104) 745
Deferred tax assets 675 31 706
Other 687 — 687
Total non-current assets 14,450 (73) 14,377
Total assets 17,880 (73) 17,807
CURRENT LIABILITIES
Payables 1,813 — 1,813
Revenue received in advance 3,277 — 3,277
Interest-bearing liabilities 969 — 969
Lease liabilities 383 — 383
Other financial liabilities 17 — 17
Provisions 1,136 — 1,136
Total current liabilities 7,595 — 7,595
NON-CURRENT LIABILITIES
Payables 44 — 44
Revenue received in advance 2,154 — 2,154
Interest-bearing liabilities 5,861 — 5,861
Lease liabilities 1,016 — 1,016
Other financial liabilities 5 — 5
Provisions 689 — 689
Total non-current liabilities 9,769 — 9,769
Total liabilities 17,364 — 17,364
Net assets 516 (73) 443
EQUITY
Issued capital 3,186 — 3,186
Treasury shares (18) — (18)
Reserves 432 — 432
Accumulated losses (3,087) (73) (3,160)
Equity attributable to members of Qantas 513 (73) 440
Non-controlling interests 3 — 3
Total equity 516 (73) 443

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Notes to the Financial Statements continued

For the year ended 30 June 2022

39 NEW STANDARDS AND INTERPRETATIONS ADOPTED BY THE GROUP (CONTINUED)

IFRIC AGENDA DECISION IN RELATION TO CONFIGURATION OR CUSTOMISATION COSTS IN A CLOUD COMPUTING ARRANGEMENT (CONTINUED)
(B) CONSOLIDATED INCOME STATEMENT RESTATED
The impact on the Consolidated Income Statement for the year ended 30 June 2021 is:

IFRIC Cloud Computing 30 June 2021

30 June 2021 Decision (restated)
$M $M $M
REVENUE AND OTHER INCOME
Net passenger revenue 3,766 — 3,766
Net freight revenue 1,316 — 1,316
Other revenue and income 852 — 852
Revenue and other income 5,934 — 5,934
EXPENDITURE
Manpower and staff-related 1,970 — 1,970
Aircraft operating variable 1,555 — 1,555
Fuel 835 — 835
Depreciation and amortisation 1,929 (52) 1,877
Share of net loss of investments accounted for under the equity
method 129 — 129
Impairment of assets and related costs 270 — 270
De-designation of fuel and foreign exchange hedges (33) — (33)
Redundancies and related costs 297 — 297
Net gain on disposal of assets (26) — (26)
Other 1,058 — 1,058
Expenditure 7,984 (52) 7,932
Statutory loss before income tax expense and net finance costs (2,050) 52 (1,998)
Finance income 20 — 20
Finance costs (321) — (321)
Net finance costs (301) — (301)
Statutory loss before income tax expense (2,351) 52 (2,299)
Income tax benefit 623 (16) 607
Statutory loss for the period (1,728) 36 (1,692)

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Notes to the Financial Statements continued

For the year ended 30 June 2022

39 NEW STANDARDS AND INTERPRETATIONS ADOPTED BY THE GROUP (CONTINUED)

IFRIC AGENDA DECISION IN RELATION TO CONFIGURATION OR CUSTOMISATION COSTS IN A CLOUD COMPUTING ARRANGEMENT (CONTINUED)
(C) ALLOCATION OF ADOPTION OF IFRIC CLOUD COMPUTING DECISION TO OPERATING SEGMENTS
The impact of the IFRIC Cloud Computing decision on the results of the operating segments for the year ended 30 June 2021 is:

Qantas Qantas Jetstar Qantas Unallocated/

30 June 2021 Domestic International Group Loyalty Corporate Eliminations Consolidated
$M
Underlying EBIT as previously reported (590) (575) (550) 272 (99) 17 (1,525)
Segment allocation of IFRIC Cloud Computing
decision impacting amortisation expense 15 27 9 — 1 — 52
Restated Underlying EBIT (575) (548) (541) 272 (98) 17 (1,473)
Net finance costs (301) (301)
Underlying PBT (399) (1,774)

(D) EARNINGS PER SHARE

IFRIC Cloud Computing 30 June 2021
30 June 2021 Decision (restated)
$M $M $M
Basic loss per share (cents) (91.8) 1.9 (89.9)
Diluted loss per share (cents) (91.8) 1.9 (89.9)

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Notes to the Financial Statements continued

For the year ended 30 June 2022

40 NEW STANDARDS AND INTERPRETATIONS NOT YET ADOPTED BY THE GROUP

A number of new accounting amendments and interpretations have been issued that are not yet effective and not yet adopted by the Group
for the financial year ended 30 June 2022. The Group intends to adopt the following new or amended standards and interpretations, if
applicable, when they become effective, with no significant impact being expected on the Consolidated Financial Statements of the Group:
– Amendments to AASB 101 Classification of Liabilities as Current or Non-current
– Amendments to AASB 3 Reference to Conceptual Framework
– Amendments to AASB 112 Deferred Tax related to Assets and Liabilities arising from a Single Transaction
– Amendments to AASB 101, AASB 8 and IFRS Practice Statement 2 Disclosure of Accounting Policies and Definition of Accounting Estimates
– Amendments to AASB 10 and 128 Sale or Contribution of Assets between an Investor and its Associate or Joint Venture.

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 QANTAS ANNUAL REPORT 2022

Directors’ Declaration
For the year ended 30 June 2022

1. In the opinion of the Directors of Qantas Airways Limited (Qantas):

a. The Consolidated Financial Statements and Notes are in accordance with the Corporations Act 2001 (Cth), including:
i. Giving a true and fair view of the financial position of the Qantas Group as at 30 June 2022 and of its performance for the financial
year ended on that date
ii. Complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations
Regulations 2001
b. There are reasonable grounds to believe that Qantas will be able to pay its debts as and when they become due and payable.
2. There are reasonable grounds to believe that Qantas and the controlled entities will be able to meet any obligations or liabilities to which
they are or may become subject to by virtue of the Deed of Cross Guarantee between Qantas and those controlled entities pursuant to ASIC
Corporations (Wholly-owned companies) instrument 2016/785 (Instrument).
3. The Directors have been given the declarations required by section 295A of the Corporations Act 2001 (Cth) from the Chief Executive Officer
and the Chief Financial Officer for the year ended 30 June 2022.
4. The Directors draw attention to Note 1(A) which includes a statement of compliance with International Financial Reporting Standards.
Signed in accordance with a Resolution of the Directors:

Richard Goyder Alan Joyce

Chairman Chief Executive Officer

9 September 2022 9 September 2022

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 QANTAS ANNUAL REPORT 2022

Independent Auditor’s Report

For the year ended 30 June 2022

To the Shareholders of Qantas Airways Limited

Opinion
We have audited the Financial Report of Qantas Airways Limited The Group consists of the Company and the entities it controlled at
(the Company). the year end and from time to time during the financial year.
In our opinion, the accompanying Financial Report of the Company The Financial Report comprises the:
is in accordance with the Corporations Act 2001, including: – Consolidated Balance Sheet as at 30 June 2022
• giving a true and fair view of the Group’s financial position as at – Consolidated Income Statement, Consolidated Statement of
30 June 2022 and of its financial performance for the year Comprehensive Income, Consolidated Statement of Changes in
ended on that date; and Equity, and Consolidated Cash Flow Statement for the year then
• complying with Australian Accounting Standards and the ended
Corporations Regulations 2001. – Notes including a summary of significant accounting policies
– Directors’ Declaration.

Basis for opinion

We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our opinion.
Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Financial Report section of
our report.
We are independent of the Group in accordance with the Corporations Act 2001 and the ethical requirements of the Accounting Professional
and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are
relevant to our audit of the Financial Report in Australia. We have fulfilled our other ethical responsibilities in accordance with the Code.

Key Audit Matters

The Key Audit Matters we identified are: Key Audit Matters are those matters that, in our professional
– Passenger revenue recognition judgement, were of most significance in our audit of the Financial
Report of the current period.
– Frequent Flyer revenue recognition
These matters were addressed in the context of our audit of the
– Derivative financial instrument accounting Financial Report as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters.

KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited
by a scheme approved under Professional Standards Legislation

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QANTAS ANNUAL REPORT 2022

Independent Auditor’s Report continued

For the year ended 30 June 2022

Passenger revenue recognition

Refer to Note 4(A) and 38(D)(i) to the Financial Report

THE KEY AUDIT MATTER HOW THE MATTER WAS ADDRESSED IN OUR AUDIT
Recognition of passenger revenue is a key audit matter due to: Our procedures included:
– its financial significance to the Group; – for key revenue streams, we assessed the Group’s identification of
– the high volume of relatively low value passenger tickets; performance obligations and revenue recognised by comparing to
the relevant features of the underlying contracts.
– judgement within the estimate for the proportion of unused
tickets which are expected to expire (breakage); and – with the assistance of our IT specialists, we analysed the end to end
flow of ticket information through multiple passenger revenue IT
– audit effort arising from a variety of ticket conditions and systems and interfaces to evaluate the recognition of revenue
points of sale. against accounting standards.
Travel restrictions caused by the COVID-19 pandemic led to a – with the assistance of our IT specialists, we tested the key controls
significant decline in global and domestic travel demand, which restricting access to authorised users and preventing unauthorised
resulted in capacity reductions leading to a number of changes to the IT systems. We tested key controls within the system
cancelled flights during the reporting period. These flight relating to ticket validation and the recognition of revenue at flight
cancellations have caused a significant reduction in passenger date.
revenue and forward bookings and also necessitated the
payment of certain customer refunds. Historical trend – testing key controls related to management review and approval of
information which has been used in the past to estimate manual changes to revenue accounting records where tickets have
breakage, has been supplemented by forward-looking been identified as exceptions to automated validation.
estimation with regard to current conditions and changes to – using data analytics and sampling techniques, checking passenger
conditions of carriage to determine breakage at 30 June 2022. revenue transactions to underlying records including evidence of
Given the dependence on IT systems and controls, we involved payment and flight records to assess the accuracy of the revenue
our IT specialists in addressing this key audit matter. recognised.
– using data analytics and sampling techniques checking passenger
revenue received in advance to underlying records to assess the
completeness of revenue recognised.
– assessing the Group’s ability to reliably estimate ticket breakage by
comparing previous estimates to actual outcomes. We met with
senior management to understand the Group’s responses regarding
ticket holders impacted by cancelled flights from the COVID-19
pandemic. Through these discussions, reviews of the Group’s
external announcements and communications to customers, we
understood the effects of cancelled flights on breakage estimates.
– checking the calculation and IT system reports in the Group’s
expectation of the proportion of tickets which will expire unused. We
evaluated the Group’s breakage assumptions against historical
trends, adjusting for the forecast recovery from COVID-19 on
customer behaviour, and assessed for indicators of bias, using our
industry knowledge.

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Independent Auditor’s Report continued

For the year ended 30 June 2022

Frequent Flyer revenue recognition

Refer to Note 4(B) to the Financial Report

THE KEY AUDIT MATTER HOW THE MATTER WAS ADDRESSED IN OUR AUDIT
Recognition of Frequent Flyer revenue is a key audit matter due Our procedures included:
to the high level of audit effort and judgement required by us in – involving our valuation specialists, we assessed the Group’s
assessing the Group’s assumptions underpinning the amount methodology used to estimate the stand-alone selling price of the
deferred as Unredeemed Frequent Flyer revenue. We focused Qantas Points against the requirements of AASB 15 Revenue from
on the Group’s assumptions used in their estimation of the: Contracts with Customers and the Group’s accounting policy.
– stand-alone selling price of the Qantas Points: this is based – we tested the integrity of the calculation used to estimate the stand-
on the observable price of available rewards weighted in alone selling price of Qantas Points, including the accuracy of the
proportion to the expected redemptions, based on historical underlying calculation formulas.
experience, and impacted by future uncertain customer
behaviour; and – we assessed the key inputs of the various redemption channels used
to estimate the stand-alone selling price of expected future
– expected proportion of Qantas Points to be redeemed by redemptions. We did this by comparing a sample to observable
members in the future (breakage): the Group uses actuarial market values, such as comparable market air fares. We compared
experts to estimate the expected proportion of Qantas Points the weighting used in the calculation to historic redemption patterns,
to be redeemed by members in the future, also based on taking into consideration the estimated future volume of Qantas
future unpredictable customer behaviour. Points redeemed for flights and our understanding of other changes
The Group was impacted by global travel restrictions in the Frequent Flyer program.
implemented in response to the COVID-19 pandemic which – involving our actuarial specialists, we assessed the appropriateness
resulted in a significant reduction in the volume of Qantas of the Group’s breakage calculation by developing an independent
Points earned and redeemed for flights and resulted in revisions model using our understanding of the Frequent Flyer program,
to the program. accounting standard requirements and comparing it to the Group’s
Given the complex judgements, we involved our valuation and calculation.
actuarial specialists to supplement our senior team members in – involving our actuarial specialists, we assessed key breakage
addressing this key audit matter. assumptions against historical experience, recent trends and the
estimated future volume of Qantas Points earned and redeemed for
flights based on the Board approved Recovery Plan and our
understanding of other changes in the Frequent Flyer program.
– we checked the accuracy of points activity data used in the
calculation of breakage to source Qantas Point’s system and reports.

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QANTAS ANNUAL REPORT 2022

Independent Auditor’s Report continued

For the year ended 30 June 2022

Derivative financial instrument accounting

Refer to Note 27 to the Financial Report

THE KEY AUDIT MATTER HOW THE MATTER WAS ADDRESSED IN OUR AUDIT
Cash flow hedge accounting and valuation of financial Our procedures included:
instruments is a key audit matter due to: – testing the Group’s key internal controls. These included the Group’s
– the complexity inherent in the Group’s estimation of the fair controls associated with:
value of derivative financial instruments. The Group uses – assessment and approval of the details of trades to counterparty
market standard valuation techniques to determine the fair confirmations;
value of options, swaps and cross-currency swaps not
traded in active markets; – assessment of hedge accounting designation; and
– the impact of changes in the underlying market price of fuel – assessment of the volume of hedged exposures compared to total
and foreign exchange rates which are key inputs to the exposures.
derivative valuations; – we compared financial instrument fair values in the Group’s
– the complexity in the Group’s cash flow hedge accounting accounting records to the records in the treasury risk management
relationships driven by an active financial risk management system.
strategy, including the restructuring of specific exposures – with the assistance of our valuation specialists, we independently
over time; estimated the fair values of the Group’s financial instruments as at
– the volume of transactions and counterparties; 30 June 2022 using recognised market valuation methodologies
and inputs. We adjusted these fair values for the range of
– the hedging of a high proportion of forecast future cash acceptable market valuation techniques in estimating fair values of
flows; and instruments not traded in active markets. We compared the Group's
– the significance of the Group’s financial risk management valuations recorded in the general ledger to these fair value ranges.
program on the financial results. – we tested a sample of cash flow hedge accounting designations
The Group continued to be impacted by COVID-19, resulting in against the requirements of the accounting standard. This included
greater uncertainty in forecasting flying activity and fuel a sample of the restructured positions involving multiple derivatives.
consumption. This has resulted in the de-designation of hedge – we compared the Group’s forecast fuel consumption against the
relationships and release of deferred gains and losses to the Board approved Recovery Plan and ensured consistency with other
income statement where hedged items were no longer key forward looking assumptions
considered probable. This required additional audit effort due to
estimation uncertainty in consumption forecasts and – we tested the Group’s derecognition of hedge relationships where
identifying the appropriate derivatives for de-designation within the hedged item is no longer considered probable.
restructured positions. – we evaluated the appropriateness of the classification and
In assessing this key audit matter, we involved our valuation presentation of derivative financial instruments and related
specialists to supplement our senior team members, who financial risk management disclosures against accounting standard
understand methods, inputs and assumptions relevant to the requirements.
Group’s derivative portfolio.

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Independent Auditor’s Report continued

For the year ended 30 June 2022

Other Information
Other Information is financial and non-financial information in Qantas Airways Limited’s annual reporting which is provided in addition to the
Financial Report and the Auditor's Report. The Directors are responsible for the Other Information.
Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not express an audit opinion or any form of
assurance conclusion thereon, with the exception of the Remuneration Report and our related assurance opinion.
In connection with our audit of the Financial Report, our responsibility is to read the Other Information. In doing so, we consider whether the
Other Information is materially inconsistent with the Financial Report or our knowledge obtained in the audit, or otherwise appears to be
materially misstated.
We are required to report if we conclude that there is a material misstatement of this Other Information, and based on the work we have
performed on the Other Information that we obtained prior to the date of this Auditor’s Report we have nothing to report.

Responsibilities of Directors for the Financial Report

The Directors are responsible for:
– preparing the Financial Report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations
Act 2001
– implementing necessary internal control to enable the preparation of a Financial Report that gives a true and fair view and is free from
material misstatement, whether due to fraud or error
– assessing the Group and Company’s ability to continue as a going concern and whether the use of the going concern basis of accounting
is appropriate. This includes disclosing, as applicable, matters related to going concern and using the going concern basis of accounting
unless they either intend to liquidate the Group and Company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the Financial Report

Our objective is:
– to obtain reasonable assurance about whether the Financial Report as a whole is free from material misstatement, whether due to fraud
or error; and
– to issue an Auditor’s Report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing
Standards will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of the Financial Report.
A further description of our responsibilities for the Audit of the Financial Report is located at the Auditing and Assurance Standards Board
website at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of our Auditor’s Report.

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Independent Auditor’s Report continued

For the year ended 30 June 2022

REPORT ON THE REMUNERATION REPORT

Opinion
In our opinion, the Remuneration Report of Qantas Airways Limited DIRECTORS’ RESPONSIBILITIES
for the year ended 30 June 2022, complies with Section 300A of The Directors of the Company are responsible for the preparation
the Corporations Act 2001. and presentation of the Remuneration Report in accordance with
Section 300A of the Corporations Act 2001.
OUR RESPONSIBILITIES
We have audited the Remuneration Report included in pages 37 to
62 of the Directors’ report for the year ended 30 June 2022.
Our responsibility is to express an opinion on the Remuneration
Report, based on our audit conducted in accordance with Australian
Auditing Standards.

KPMG Julian McPherson Caoimhe Toouli

Partner Partner
Sydney Sydney
9 September 2022 9 September 2022

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 QANTAS ANNUAL REPORT 2022

Shareholder Information
For the year ended 30 June 2022

The shareholder information set out below was applicable as at 12 August 2022.
TWENTY LARGEST SHAREHOLDERS

Shareholders Ordinary Shares Held % of Issued Shares

HSBC Custody Nominees (Australia) Limited 558,094,186 29.59

J P Morgan Nominees Australia Pty Limited 311,644,181 16.52
Citicorp Nominees Pty Limited 183,635,750 9.74
National Nominees Limited 135,657,197 7.19
BNP Paribas Noms Pty Ltd (DRP) 61,290,709 3.25
Citicorp Nominees Pty Limited (Colonial First State INV A/C) 31,318,257 1.66
HSBC Custody Nominees (Australia) Limited – GSCO ECA 23,611,748 1.25
BNP Paribas Nominees Pty Ltd (Agency Lending DRP A/C) 16,097,921 0.85
HSBC Custody Nominees (Australia) Limited (A/C 2) 14,827,487 0.79
HSBC Custody Nominees (Australia) Limited (NT – Comnwlth Super Corp A/C) 10,342,762 0.55
HSBC Custody Nominees (Australia) Limited – GSI EDA 10,157,671 0.54
Pacific Custodians Pty Limited (QAN Plans Ctrl) 9,982,880 0.53
Maxfill Australia Pty Ltd 8,100,000 0.43
UBS Nominees Pty Ltd 7,639,597 0.41
BNP Paribas Nominees Pty Ltd (IB AU Noms Retail Client DRP) 5,370,898 0.28
Netwealth Investments Limited (Wrap Services A/c) 3,791,609 0.20
Mutual Trust Pty Ltd 3,411,018 0.18
Alan Joyce Pty Ltd 2,728,924 0.14
Neweconomy Com AU Nominees Pty Limited (900 Account) 2,546,813 0.14
BNP Paribas Noms (NZ) Ltd (DRP) 2,252,227 0.12
Total 1,402,501,835 74.36

DISTRIBUTION OF ORDINARY SHARES

Analysis of ordinary shareholders by size of shareholding:

Number of Shares Ordinary Shares Held Number of Shareholders % of Issued Shares

1
1-1000 48,790,711 121,166 2.59
1,001-5,000 161,111,416 67,486 8.54
5,001-10,000 74,936,185 10,455 3.97
10,001-100,000 137,645,677 6,408 7.30
100,001 and over 1,463,560,709 220 77.60
Total 1,886,044,698 205,735 100.00
1 11,753 shareholders hold less than a marketable parcel of shares in Qantas, as at 12 August 2022.

ON-MARKET SHARE BUY-BACK

On 25 August 2022, Qantas announced its intention to undertake an on-market share buy-back of up to $400 million.
SUBSTANTIAL SHAREHOLDERS
The following organisation has disclosed a substantial shareholding notice to ASX. Qantas has received no further update in relation to this
substantial shareholding:

Shareholders Ordinary Shares Held % of Issued Shares

1
Pendal Group Limited 82,037,038 5.22
1 Substantial shareholding as at 4 November 2019, as per notice dated 6 November 2019.

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 QANTAS ANNUAL REPORT 2022

Financial Calendar and Additional Information

For the year ended 30 June 2022

2022 2023

24 February Half year results announcement 23 February Half year results announcement
30 June Year end 7 March Record date for interim dividend*
25 August Preliminary final results announcement 11 April Interim dividend payable*
4 November Annual General Meeting 30 June Year end
24 August Preliminary final results announcement
12 September Record date for final dividend*
17 October Final dividend payable*
3 November Annual General Meeting
*Subject to a dividend being authorised by the Board

2022 ANNUAL GENERAL MEETING ADDITIONAL SHAREHOLDER INFORMATION

The 2022 AGM of Qantas Airways Limited will be held in a hybrid Using your Shareholder Reference Number (SRN) or Holder
format at 11am AEDT (Sydney time) on Friday 4 November 2022. Identification Number (HIN) and postcode of your registered address,
Further details are available in the Annual General Meeting section on you are able to view your holding online through Qantas’ share
the Qantas Investor website: investor.qantas.com/home/ registry, Link Market Services. Log on at
www.linkmarketservices.com.au, where you will have the option to:
COMPANY PUBLICATIONS
– View your holding balance
In addition to the Annual Report, the following publications can be
accessed from www.qantas.com/au/en/qantas-group/acting- – Retrieve holding statements
responsibly/our-reporting-approach.html – Review your dividend payment history
– Qantas Group Code of Conduct and Ethics – Access shareholder forms.
– Qantas Group Corporate Governance Statement The Investor Centre also allows you to update or add details to your
– Qantas Group Inclusion and Diversity Policy shareholding, including the following:

– Qantas Group Modern Slavery and Human Trafficking Statement – Change or amend your address if you are registered with an SRN

– Qantas Group Human Rights Policy Statement – Nominate or amend your direct credit payment instructions

– Workplace Gender Equality Reports. – Set up or amend your DRP instructions

REGISTERED OFFICE – Sign up for electronic communications

Qantas Airways Limited ABN 16 009 661 901 – Add/change TFN/ABN details.
10 Bourke Road, Mascot NSW 2020 Australia COMPANY SECRETARIES
Telephone +61 2 9691 3636 Andrew Finch
www.qantas.com Benjamin Elliott
QANTAS SHARE REGISTRY Benjamin Jones
Link Market Services Limited An electronic copy of this Annual Report is available in the Annual
Level 12, 680 George Street, Sydney NSW 2000 Australia, or Report section on the Qantas Investor website:
Locked Bag A14, Sydney South NSW 1235 Australia investor.qantas.com/home/
Telephone 1800 177 747 (toll free within Australia) Further information about the Qantas Group can be found on our
International +61 2 8280 7390 corporate site at www.qantas.com/qantas-group
Facsimile +61 2 9287 0309
Email registry@qantas.com
SECURITIES EXCHANGE
Australian Securities Exchange
Exchange Centre, 20 Bridge Street,
Sydney NSW 2000 Australia

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The Qantas Annual Report 2022 is printed on ecoStar+ 100% Recycled Uncoated, which is manufactured from 100% recycled
post-consumer waste and is made carbon neutral.
QANTAS AIRWAYS LIMITED
ABN 16 009 661 901