Airways New Zealand Announces Annual Result

22 October 2004

Airways New Zealand Announces Annual Result

Airways New Zealand has announced its annual result for the twelve months to 30 June 2004. The company has achieved an Economic Value Added (EVA*) Group after tax profit of $5.7 million, significantly up on last year’s profit of $3.9 million, owing largely to an increase in trans-Tasman traffic and a resurgence in domestic travel. Airways has also been able to return a total of $12 million in dividends to its shareholders, and pay $2.6 million in rebates to its customers in line with its Partnership Plan.

Airways Chairman, Mr Errol Millar, says the 2003/04 year was one in which Airways again demonstrated to the international aviation industry its ability to perform to world-class standards of profitability and practice.

“Since the International Air Transport Association (IATA) voted Airways as among the world’s best providers of air navigation services in terms of value for money and quality of service last year, the company has been in the international spotlight.”

“Airways is now a recognised industry leader for its success as a fully commercial provider of air navigation services, lauded for its agility and responsiveness to customer needs and its uncompromising commitment to the highest standards of service and safety,” said Mr Millar.

Operational Performance

Airways achieved or progressed all domestic performance objectives in its Statement of Corporate Intent. These objectives included: completion of the three year project to upgrade New Zealand’s air traffic management system – on time, on budget and to specification; completing a review of service and location options for the Ohakea Centre following the agreement for new services levels with the RNZAF in 2003; and ongoing refinement of the company’s risk and safety management practices.

Safety Performance

Airways continued to improve on its already excellent safety record, continuing the trend of the last eight years. Airways continues to benchmark its safety performance against air navigation services (ANS) providers in other countries, a process that has so far demonstrated its place among the world’s top ANS providers.

Financial Performance

Airways exceeded its financial targets to achieve a Group EVA of $5.7 million. A cross-border lease transaction involving the newly upgraded air traffic management assets, has significantly strengthened the balance sheet and added a great deal of value to the company. This, along with the financial result, has improved shareholder equity to almost $87 million and enabled payment of a dividend representing a cash return on investment after tax of 16.6 percent.

In the conventional accounts net profit after tax was $9.2 million ($7.1m, 2002/2003), and the shareholders’ equity remains stable after paying a dividend of $12 million.

ENDS

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