Australia's Qantas to post better-than-expected profits

Qantas chief executive Alan Joyce has said he is delivering one of the biggest turnarounds in Australian corporate history

Australia's Qantas has said it expects to report better-than-expected profits for the six months to December, boosted by lower oil prices and a continued focus on its revival plans.

The airline forecast underlying pre-tax profit of between A$875m ($635m; £419m) and A$925m for the period.

Qantas has been aggressively reducing jobs and cutting capacity in recent months.

Shares initially rose 1% on the news, however, later closed down 2.4%.

The airline's shares have risen by almost 50% this year.

Airline analysts said they were surprised by the share price eventually closing lower.

"It is interesting," Flightglobal's Ellis Taylor told the BBC. "The guidance that came out was very good, but perhaps some investors were hoping for better figures."

However, Mr Taylor added that some aviation analysts had forecast the airline would exceed the billion dollar mark for the half year.

"And against that, the lower end of its guidance band doesn't look as good," he said.

Earlier this year, Qantas reported a return to annual profit for the 12 months to June and also announced plans to buy new planes.

The airline reported a full-year profit of A$975m (£457m; $717m) - a dramatic reversal after posting a loss of A$646m for the previous year.

It will report its half-year results on 23 February.

Frequent flying

As part of its frequent flyer programme overhaul, the airline is set to renew its partnership with supermarket giant Woolworths - albeit with a slightly different structure.

The partnership programme faced criticism from consumers when an earlier agreement was changed to give shoppers discounts rather than points.

Woolworths, Australia's largest supermarket chain, said the new agreement would allow shoppers to convert their Woolworths dollars into Qantas points at a rate of 870 Qantas points for every 10 Woolworths dollars, rather than receive A$10 off their grocery bill.