Alliance Airlines to Review Wet Lease Deals and Cut Costs
Alliance Airlines (QQ, Brisbane International) has launched a review of its wet lease contracts and overall business model after rising costs forced the carrier to warn that its annual results will be “materially lower” than expected. The airline also initiated a cost-reduction program focused on purchasing, logistics, and the sale of non-core assets.
In a November 7, 2025, stock market disclosure, the airline said it now expects earnings before interest, tax, depreciation, and amortization (EBITDA) for the fiscal year ending June 30, 2026, to range between AUD 190 million and AUD 210 million (USD 123–136 million), well below analysts’ forecasts of over AUD 250 million (USD 162 million). Alliance attributed the shortfall to rising aircraft and engine acquisition costs and higher-than-expected maintenance expenses.
Depreciation charges have risen by AUD 15 million (USD 9.7 million), while annual repair, maintenance, and logistics costs are expected to increase by AUD 12 million (USD 7.8 million). The airline also cited a AUD 4.2 million (USD 2.7 million) unresolved dispute with a major customer and an unplanned AUD 3.5 million (USD 2.3 million) expenditure linked to the accelerated rollout of a new inventory management system.
Despite these challenges, Alliance Airlines said it remains profitable, maintains strong cash flow, and continues to meet banking covenants. The company has engaged external advisors to reassess depreciation methods, review its property portfolio, and identify assets for potential sale.
Following the financial update, Alliance resumed trading on the Australian Securities Exchange (ASX) after a week-long suspension. The airline also announced that founding managing director Scott McMillan stepped down on November 7—three weeks earlier than planned—with joint managing director Stuart Tully assuming full leadership.
According to ch-aviation data, Alliance Airlines operates 43 Embraer E190s, 24 Fokker 100s, and 12 Fokker 70s. It also owns five E190s leased to Airnorth (Australia) until at least 2030 and has ten additional E190s due by mid-2026 after a six-month delivery delay. The carrier serves both scheduled and charter markets, focusing on the resources sector, and wet-leases regional capacity to Virgin Australia (using Fokkers) and Qantas (using E190s).
Related News: https://airguide.info/category/air-travel-business/airline-finance/
Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com