Qantas to set up new freight business

Qantas Airways will set up a new domestic air freight business as part of a strategy to diversify its revenue base.

The national carrier, which is battling record high jet fuel prices in a highly competitive aviation market, said the freight operation will start up in October.

"Growing our freight operations is a core strategy for the Qantas Group, aimed at diversifying and strengthening our revenue base," chief executive Geoff Dixon said.

Qantas will today release its 2005/06 annual results, which are expected to show a 27 per cent decline in pre-tax profit to A$670 million ($807 million) from the previous year.