SYDNEY, Dec 3 (Reuters) - Qantas Airways Ltd said on Thursday the reopening of Australian state borders would boost its financial position and allow it to return to 68% of pre-pandemic domestic capacity this month, rising to nearly 80% in the March quarter.

The airline said it expects to post a substantial bottom line loss for the financial year ending June 30, 2021.

However, Qantas said it would be close to breakeven at the underlying earnings before interest, tax, depreciation and amortisation level in the first half and net free cash flow positive excluding redundancy payments in the second half. (Reporting by Jamie Freed Editing by Chris Reese)