The record performance is a 57 per cent per cent improvement on financial year 2015. It means Qantas can resume dividend payments, reward 25,000 EBA-covered employees with a one-off cash bonus, and continue investment for customers, including extending wi-fi to Qantas’ regional and international fleets and finalising the network and customer experience for the Qantas Dreamliner.

Qantas Domestic, Qantas International, the Jetstar Group and Qantas Loyalty all reported record results. Total underlying EBIT in the domestic market – across both Qantas and Jetstar – was a record $820 million, up $191 million, and total underlying EBIT in the international division was $722 million, up $374 million. Return on invested capital was 23 per cent, compared with 16 per cent at 30 June 2015, and earnings per share almost doubled to 49 cents.

The Qantas Transformation program continues to reshape the Group’s cost base and ability to generate revenue. It has unlocked $1.66 billion in permanent cost and revenue benefits since early 2014, including $557 million in financial year 2016, and is now outperforming, with the Group expecting to realise $2.1 billion in benefits by June 2017.

Effective fuel hedging saw the Group secure a $664 million benefit from lower global fuel prices compared with financial year 2015, passing a proportion of these savings through to air fares – which are up to 40 per cent lower than a decade ago in the Australian market.

The Group’s financial position improved significantly during the year, with $2.8 billion in operating cash flow used for capital expenditure, shareholder distributions and debt repayments, and excess cash used for refinancing.

Chief executive Alan Joyce said the result demonstrated the success of Qantas’ strategy to build a strong, sustainable future for the national carrier. “Our transformation program is paying dividends for our shareholders, our customers and our employees,” Mr Joyce said. “Our people can be incredibly proud of what they’ve achieved. It’s thanks to their skill and commitment that we’re announcing a record profit today. “This was a true team performance, which shows that our strategy is the right one for the tough markets we’re operating in and the long-term opportunities we see ahead of us. “Transformation has made us a more agile business, created value for our shareholders and given us a platform to invest for the future. Qantas is stronger than ever, but we’re also determined to keep changing and adapting so that we can succeed no matter what environment we’re in.”