SYDNEY (AP) - Qantas Airways reported a modest 5 million Australian dollar ($4.5 million) annual profit as cost cuts offset losses at its international arm.

SYDNEY (AP) Qantas Airways reported a modest 5 million Australian dollar ($4.5 million) annual profit as cost cuts offset losses at its international arm.

The previous year, Australia's flagship airline posted a record AU$245 million loss due to rising fuel prices, strikes that grounded its fleet and weak demand on international routes.

Qantas chief executive Alan Joyce said Thursday that cost-cutting, including the restructure of the airline's international network, had delivered AU$171 million in benefits to the company for the year ended June 30. He says the airline's costs were down 5 percent.

The international division remained a weight on the company, posting a loss of AU$246 in the latest year.

The loss in the previous year was the airline's first since the formerly Australian government-owned carrier was privatized in 1995.