Qantas Financial Risk Essay

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Financial Risks

Qantas faces a number of risks. Some are classical financial risk in nature and some more general. The more classical risks can generally be managed or at very least hedged, however, some of the competitive risk and managerial risk needs to be internally managed via business strategy, policy and implementation.
“The Group is subject to foreign currency, interest rate, fuel price and credit risks. Derivative and non-derivative financial instruments may be used to hedge these risks. It is the Group’s policy not to enter into, issue or hold derivative financial instruments for speculative trading purposes” (Qantas Annual Report 2015).
Fuel Price Risk – (The focus of this report)
Fuel costs make up 26.7% of total operating costs.
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