Qantas Airways Ltd., Australia’s largest carrier, forecast its best half-year earnings in four years as A$2 billion ($1.7 billion) of cost reductions and lower fuel prices help increase profit margins.

Profits before tax and one-time items will be between A$300 million and A$350 million in the six months ending Dec. 31, the Sydney-based airline said in a regulatory statement today. That will be the best six-month period for the airline since it posted A$417 million in profits on the measure in the six months ended December 2010.

Improving first-half earnings will increase Qantas’s chance of posting a net profit in the full year, where three of nine analyst estimates compiled by Bloomberg are still foreseeing losses. Qantas has lost money before tax and items in the second half in each of the past three years.

“The strategy we have outlined to transform our business is working,” Chief Executive Officer Alan Joyce said in a statement. “These strong early results give us the confidence that we will continue to meet all the targets we have set.”

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Photo Credit: Two Qantas passenger jets cross each other at Kingsford Smith International airport in Sydney June 27, 2013. Daniel Munoz / Reuters