Officially, most analysts see the airline's net profit before one-off items at about A$30 million, slightly lower than 1998.

But privately they say otherwise. ``The risk is on the upside, one aviation analyst said.

``I suspect they'll beat last.``You're looking at a 12-year low fuel price, very strong domestic business with load factors of 82 per cent in October, and strong cost savings coming through, the second analyst said.

At least one analyst has forecart an actual increase. Warburg Dillon Read transport analyst Fiona Green said she has upgraded her 1998-99 forecast for net profit before abnormal items by six

Green, former head of Qantas investor relations, cited Australia's economic strength and lower fuel prices. ``Effectively, I've re-forecast the second half,'' she said.

``Originally, I'd had the second half being quite a difficult perioddomestically,'' she said. Analysts have lauded the speed with which Qantas management assessed and reacted to the impact of Asia's economic woes by swiftly suspending flights and cutting costs.

Chief executive James Strong has vowed the airline would continue to find ways to lower costs. Transport analyst Jason Smith at Salomon Smith Barney, said he expects Qantas' 1998-99 cost savings to be at A$400 million from A$475 million a year earlier.

``There'll be a few more years of cost savings, but it'll be difficult to match those sorts of numbers,'' Smith said. Even Qantas itself has, in its own conservative way, suggested better expectations.

Qantas chairman Gary Pemberton said in August the 1997-98 net profit, which was 20.7 per cent above the previous year and exceeded analysts' forecasts, would be difficult to match this financial year.

However at its annual meeting in mid-November, he said it could possibly match the A$304.8 million figure. ``We are on the record as saying it would be difficult tomatch last year and by implication our target is to do at least that,'' chairman Gary Pemberton said at the annual meeting.

Pemberton warned shareholders signs were emerging of accelerated deterioration in market conditions and yields, spurring a wait-and-see stance in the company.

But Pemberton, known for his preference for erring on the side of caution, warned at its August results briefing that it would be hard to match this in the current year.

Forecasts for Qantas' first half to December net profit centre around A$200 million, with most analysts expecting a weaker second half. The airline is to announce interim earnings on February 18.