The group now expects an underlying profit before tax of between $1.35bn and $1.45bn, which represents a $150m increase to the profit range it posted in early October 2022.

The carrier said consumers continue to "put a high priority" on travel ahead of other spending categories, and there are signs limits on international capacity are driving more domestic leisure demand.

Despite the positive outlook, the group said fuel costs "remain significantly elevated" compared with 2019 and are expected to reach approximately $5 billion for 2023, which would be a record high for the group despite international capacity remaining 30% below pre-Covid levels.

The group’s net debt is also expected to fall to an estimated $2.3 billion and $2.5 billion by 31 December 2022, which is around $900 million better than expected in the most recent update, due to an "acceleration" of revenue inflows.

Around 60% of the $2 billion in Covid-related travel credits held by the group have now been redeemed by customers.

Qantas said that while capacity would remain constrained for the foreseeable future, it would continue to discount in the weeks ahead – adding it would also continue to add new capacity "as quickly as possible" during the second half of the year.