SYDNEY, Australia (AP) - Qantas Airways Ltd. has slashed its profit forecast for the current year and will cut back on services to cope with plummeting demand because of the global financial downturn.
Chief executive Geoff Dixon said in a statement Tuesday Qantas now expects its profit before tax for the year to the end of June 2009 to be around Australian dollars 500 million ($316 million).
Dixon said the forecast was still within analysts expectations.
Qantas said in August it expected profit for the year to be around AU750 million ($474 million), but with a range of between AU$430 million and AU$1 billion ($270 million and $630 million).
Dixon said Qantas would reduce capacity to the equivalent of grounding 10 planes, and that "actual flying'' in the next six months would be 4 percent less than the same period in the previous year.
"We are in unpredictable times and the international business market, in particular, has slowed,' Dixon said in the statement.
To meet the capacity cuts, the company would not take up the planned lease of two A330-200 planes, change flying patterns of the remaining fleet, and halt all planned domestic market growth for Qantas and its budget stable mate, Jetstar.
Incoming chief executive Alan Joyce said Qantas had benefited from cheaper fuel in recent months but this was offset by falls in demand since September.