Air NZ ready to rival Jetstar

An Air New Zealand passenger plane crosses a waxing gibbous moon on its way to the Los Angeles International Airport from London, Sunday, Aug. 23, 2015, in Whittier, Calif. (AP Photo/Nick Ut)
By Hannah Edensor


Air New Zealand said increased passenger demand will drive an 85% jump in first-half earnings before tax to $NZ400 million ($A365.38 million).

The forecast profit is up from $NZ216 million achieved in the first half of last year and excludes any equity-accounted contribution from its stake in Virgin Australia.

Chairman Tony Carter told shareholders at the airline’s annual meeting in Auckland on Wednesday that significant earnings growth had been achieved in the first quarter of this financial year on the back of buoyant tourism in New Zealand, lower fuel costs, and savings from fleet efficiencies.

Chief executive Christopher Luxon said there had been a big boost in international demand through various tourism initiatives and the “little company from New Zealand” was well-placed to take advantage of that following its investment in new fleet.

The company is spending $NZ2.6 billion in the next four years on new aircraft and has ordered another seven Boeing Dreamliners.

Commenting on competition from Qantas offshoot Jetstar on regional routes in New Zealand, Luxon said the airline was ready and able to compete and that passengers should expect more competitive fares across the board this year.

Despite a largely upbeat meeting following the company’s record results and dividend in 2015, one shareholder castigated the chairman for “playing tiddlywinks” on his phone while he and other Air New Zealand passengers had to spend a night sleeping on chairs at Hong Kong Airport when Flight NZ80 was delayed due to engine problems earlier this week.

Luxon said the airline had reviewed its processes for handling disruptions, which were a fact of life for any airline given weather problems and safety concerns.

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