The Qantas annual general meeting has kicked off in Melbourne this morning, with chairman Leigh Clifford addressing the company’s “totally unsatisfactory” results.

Mr Clifford addressed the underlying loss of $646 million without tax for the financial year, saying the board recognised “this was a totally unsatisfactory result”.

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He blamed a combination of factors for the poor results, citing “market capacity growth”, “a record high fuel bill” and “weaker general demand in the domestic market for leisure and business travel”.

CEO Alan Joyce chose to focus on new figures released ahead of the meeting showing that passenger numbers have increased.

According to the figures, Qantas lifted passenger counts in September, aided by a pickup in business for its Jetstar and regional airline services.

However Qantas’ troubled international arm saw passenger numbers fall two per cent.

“The evidence shows that we are on track for our plans,” Mr Joyce said on the improvements.

“The transformation program is delivering clear results.”

Mr Joyce said the company was on track to deliver a profit for the first half of the financial year based on preliminary figures.

Senator Nick Xenophon, who recently became a Qantas shareholder in order to attend the meeting, blamed Mr Joyce and the board for the company’s recent shortcomings.

Senator Xenophon told media that a proposed pay rise for Mr Joyce would be “obscene” in the wake of the poor financial results.

Mr Joyce currently earns $2.1 million a year and would receive an extra $2.5 million should the board vote in favour of his pay rise.

“This board needs to be held accountable for a series of disastrous decisions that have cost shareholders dearly, demoralised loyal staff and have tarnished the reputation of a great Australian icon,” Senator Xenophon said.

The senator also took issue with Qantas’ decision to provide confidential briefings to its institutional investors.

“There can’t be two classes of shareholders,” Senator Xenophon said.

“Why should Aussie mum and dad investors be kept in the dark while the big end of town has privileged access to these briefings?”