Qantas has lifted first-half profit 18 per cent to $607 million and will return another $378 million of capital to shareholders in the form of a share buyback.
Underlying pre-tax profit for the six months to December 31 has soared 14.6 per cent to a record $976 million, but net profit has fallen short of 2016's record $688 million due to $119 million of costs including redundancies and the introduction of the Dreamliner aircraft.
Nonetheless, Qantas will pay an unfranked interim dividend of seven cents and says it will buy back up to $378 million of shares, which will take the total spent on buybacks in the past two years to $1.617 billion.
Chief executive Alan Joyce says the transformation of Qantas during his tenure - which has included hefty redundancies, route changes and aircraft retirements - has left the airline well placed. He says Thursday's first-half result includes $181 million of benefits from the transformation program, with a full-year target of $400 million.
"After several years of consistent performance, we now have a lot of momentum behind us," Mr Joyce said in a statement.