QANTAS Airways Ltd yesterday reported a 44-percent rise in annual net profit, but acknowledged it was beginning to feel the effect of a slowing economy and higher fuel costs.
It reported a second-half profit fall of 2.5 percent.
Australia's largest airline posted a net profit of A$969 million (US$842 million) for the year ending on June 30, up from A$673 million the previous year. The result was slightly lower than market forecasts of A$1.02 billion.
Sales rose 7.5 percent to A$16.2 billion from A$15.1 billion a year ago.
The firm has implemented a number of measures to combat record jet fuel prices, including increased fares, decreased routes and fuel-hedging.
"The rapid rise in fuel costs since December last year is unprecedented and the impact has been felt across the aviation industry and the world economy," Chief Executive Geoff Dixon said.
Dixon acknowledged the recent spate of problems that have plagued the airline, including an explosion on board a Qantas jumbo jet over the Philippines last month.