Air New Zealand comes out swinging

Air New Zealand has today announced record normalised earnings before tax for the first six months of the 2015 financial year.

The airline clocked in earnings at $216 million, a bump of 20% on the previous corresponding period.

Statutory earnings before taxation were $197 million, while net profit after tax was $133 million, marking a drop of 6%.

But strong results were driven by strong revenue growth, largely due to increased capacity and improved yields across the network.

Air NZ’s operating cash flow also experienced a jump of 26% on the previous period to $378 million.

The Board has declared a fully imputed interim dividend of 6.5 cents per share, which marks a massive increase of 44% compared to the same period last year.

Shareholders should be very pleased with the results, according to chairman Tony Carter, who said it shows that Air New Zealand is soaring as one of the few global airlines generating sustainable profit.

“We have excellent sales and marketing expertise combined with a consistent focus on cost control, an award-winning uniquely Kiwi customer experience and the delivery of outstanding operational performance,” Carter said.

“Fuel prices are lower than in November and the sales momentum has been maintained, further strengthening the company’s outlook for the current year and beyond,” he added, off the back of the airline’s statement in November that fuel price levels would give earnings a helping hand in the second half of the financial year.

Chief executive officer Christopher Luxon said the airline has its sights set on competitive fare prices as a way of staying strong in all markets.

“Whether it be here in New Zealand, on the Tasman, to the Pacific Islands or on our extensive long haul network, Air New Zealand customers can expect to see even more competitive pricing,” Luxon said.

“Initiatives like the reintroduction of the popular Night Rider service and its extension to regional New Zealand have been a hit, as have Grabaseat’s low priced long haul fares to destinations like Los Angeles and Tokyo.

“We are a small airline and will continue to punch well above our weight as we strive to become a truly great company. To us, this means delivering on three major goals at once – superior commercial results, continuing to enhance the customer experience and further developing our people and culture.”

Luxon added that the airline is looking sharp in 2015, with recommenced flights on the Auckland-Singapore route and its alliance with Singapore Airlines a key part of this Pacific Rim strategy.

“We have also announced plans for our first ever scheduled services to South America, flying direct to Buenos Aires, Argentina, from December this year. Tickets go on sale soon, and this will become our 28^th international destination, opening up exciting new possibilities for customers travelling between South America, New Zealand, Australia and Asia,” he said.

And Air NZ has plenty of investments in its future, with more than $40 million already being spent on upgrading airport lounges and the roll out of self-check in kiosks and mobile technology.

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