Qantas has finally flown back to profitability after three years and extended a share buyback for shareholders but that might not translate into significantly cheaper fares for customers.

At a post-results media briefing on Thursday, CEO Alan Joyce admitted high ticket prices are contributing to ongoing cost of living pressures, with domestic fares up about 20 per cent compared with 2021, and by similar amounts in key markets such as the United States and Europe. 

“The main drivers of this are the price of fuel which is up 65 per cent compared to 2019 levels, and the imbalance between supply and demand,” he said. 

“Airlines are struggling to keep up with a tremendous level of passenger demand. And as we get up to speed that has pushed prices up, especially in peak times or for last minute travel.”

He said it was proving difficult to add back capacity quickly, particularly in the international segment, as airlines struggle to get maintenance and safety checks completed on long-grounded aircraft and embark on recruitment and training to fill up gaps in pilot and cabin crew numbers.

The national carrier reported a statutory half-year profit of $1 billion, its first positive result in three years. A rebound in air travel demand helped Qantas notch up revenue of $9.9b, more than three times the figure for the same period a year ago.

The bulk of the gains were contributed by the domestic segment, which recorded $785m in earnings, while international and freight contributed $464m.

“Qantas does charge more than other airlines in domestic market … because you get more value with Qantas in other areas. And it’s all about value,” Mr Joyce said in response to a question about customer anger over high fares.

“A lot of customers will pay that extra to have access to 51 lounges around the world, have access to the frequent flyers, to get free food on board, to get baggage included and to get free wi-fi.”

But the airline boss had words of encouragement for travel hopefuls.

“Fares will keep trending down as more airlines can unlock capacity, which relies on things like supply chain for aircraft, labour availability and training pipelines,” he said.

“There are a lot of cheap airfares in the market, especially when you think well in advance.”

Qantas and subsidiary Jetstar launched a fresh sale on Thursday, with a million seats across their network. Mr Joyce also noted that rivals Virgin Australia and Bonza had launched similar promotions.

By Prashant Mehra in Sydney