Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Air NZ FY profit more than doubles, beating estimates

Air NZ FY profit more than doubles, beating estimates

By Jonathan Underhill

Aug. 29 (BusinessDesk) – Air New Zealand, which is preparing to spend $1.8 billion on aircraft in the next three years, more than doubled annual profit, beating estimates, as it squeezed more revenue from a rising volume of passengers and benefited from favourable foreign exchange movements.

Net profit rose to $182 million in the 12 months ended June 30, from $71 million a year earlier, the Auckland-based company said in a statement. Sales rose 3 percent to $4.6 billion. First NZ Capital had forecast profit of $168.3 million

Shares of the airline, which is 74 percent owned by the government and slated for a partial selldown, jumped 3.7 percent to $1.42, posted its best results in five years. It has gained about 60 percent in the past year, more than double the increase in the NZX 50 Index, and is rated a ‘buy’ by all six analysts polled by Reuters, with a median price target of $1.80.

The company gave no specific guidance for the year ahead. Chief executive Christopher Luxon Air New Zealand is “focused on further improving this result in the 2014 financial year.”

“Based on our forecast of market demand and fuel prices at current levels, early results and forward bookings are encouraging,” he said.

Foreign exchange gains added $57 million to earnings.

To cater for growing demand and update its fleet to the latest fuel-efficient models, Air New Zealand will add four Airbus A320's, one ATR72-600 and one Boeing 777-300ER aircraft to its fleet in 2014.It plans to add nine aircraft in 2015, six in 2016 and a further two in 2017.

The company is well placed to fund its expansion, with net cash on hand rising 12 percent to $1.15 billion at the end of the latest financial year, while gearing fell 7 percentage points to 39.1 percent.

The airline’s international services reported the strongest improvement in yield in 2013, rising 4.3 percent to 10.6 cents per revenue passenger kilometre (RPK) after rationalising its network, including suspending the Hong Kong to London route.

On the Tasman and Pacific Island routes, yield rose 1.9 percent as the company added capacity.

Total passenger numbers rose 2.2 percent to 13.4 million, outpacing a 1.7 percent increase in available seat kilometres. The load factor rose 0.8 points to 83.6 percent and yield improved 0.9 percent to 13.6 cents per RPK.

Yield on its largest domestic service fell 5.3 percent to 27.2 cents per RPK even as passenger numbers grew 2.3 percent to 8.69 million and the airline was forced to offer cheaper fares to stimulate demand.

The company will pay a final dividend of 5 cents a share, making 8 cents for the year, up 45 percent from a year earlier.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 


Stats: Auckland’s Population Falls For The First Time
In the wake of the COVID-19 pandemic, New Zealand’s population growth slowed down with Auckland recording a population decline for the first time ever, Stats NZ said today. “New Zealand saw slowing population growth in all regions... More>>



BusinessNZ: Third Snapshot Report Reveals $9.5 Billion Business Investment In Climate Action

Signatories to the Climate Leaders Coalition have committed to invest $9.5 billion over the next five years to reduce emissions from their businesses, as revealed in their third anniversary snapshot report released today... More>>

Digitl: The home printer market is broken
Printers are more of a security blanket that a serious aid to productivity. Yet for many people they are not optional.
Even if you don’t feel the urge to squirt ink onto dead trees in order to express yourself, others will insist on printed documents... More>>


Retail NZ: Some Good News In COVID Announcements, But Firm Dates Needed

Retail NZ is welcoming news that the Government is increasing financial support for businesses in light of the ongoing COVID-19 lockdown, and that retail will be able to open at all stages of the new “Covid Protection Framework... More>>

ComCom: Companies In Hot Water For Selling Unsafe Hot Water Bottles And Toys

A wholesaler and a retailer have been fined a total of $140,000 under the Fair Trading Act for selling hot water bottles and toys that did not comply with mandatory safety requirements. Paramount Merchandise Company Limited (Paramount) was fined $104,000 after pleading guilty in the Manukau District Court... More>>



Reserve Bank: Robust Balance Sheets Yield Faster Economic Recovery

Stronger balance sheets for households, businesses, financial institutions and the government going into the pandemic contributed towards maintaining a sound financial system and yielding a faster economic recovery than following previous deep recessions... More>>