HomeTravel NewsAir New Zealand Back in Profit After Covid Losses

Air New Zealand Back in Profit After Covid Losses

Air New Zealand’s recovery is well underway, with the airline announcing statutory first half earnings before taxation of $299m and revenue of $3.1bn for the six months to the end of December – progress that will enable the airline to support New Zealand’s economic recovery. 

Following three years of Covid-related losses, Air New Zealand’s interim result reflects sustained demand strength, particularly across the summer peak period, a return in business travel and overseas tourists, as well as cargo revenues above pre-Covid levels.  

Air New Zealand is back in profit

Air New Zealand Chair Dame Therese Walsh said she is incredibly proud of the Air New Zealand whānau and their determined efforts to get New Zealanders flying again, especially given the challenges of restarting an airline amid Covid. 

“Today’s result reflects an important milestone in our recovery and places us in a strong position to deliver on our strategy,” Ms Walsh said. 

“When New Zealand’s borders reopened much earlier than expected, our people rose to the occasion, moving swiftly to return aircraft to service, relaunch 29 routes and onboard more than 3,000 employees to support the eight million customers we flew between July and December – the busiest period we’ve seen in over three years. 

“Despite some turbulence, we’ve stayed focused on getting our customers where they needed to go while keeping our eyes on the future. This result means we can continue to invest in our fleet, our people and our decarbonisation goals, to deliver the customer experience Air New Zealand is world-renown for. 

“But we must acknowledge these results are being announced in the wake of the devastation that the Auckland floods and Cyclone Gabrielle have left behind. Both of these catastrophic events have heavily impacted several regions we fly to, and our hearts go out to all those impacted. We’re committed to supporting those regions however we can.” 

Air New Zealand chief executive Greg Foran echoed Dame Therese’s comments and praised teams across the business who worked quickly to ensure the safety of our customers and our people. 

On the financial performance for the half, Mr Foran noted the result was delivered against a backdrop of significant labour, supply chain and operational pressures that have challenged the airline, and the entire global aviation system.  

“Our recovery is well underway and operating performance is improving steadily, but like most airlines globally, we continue to experience challenges that make it hard at times for our fantastic team to deliver the level of service we expect of ourselves, and our customers expect of us,” said Mr Foran. 

“We know we have more work to do to tackle customer concerns like long wait times at our call centres, getting planes to depart and arrive on time, lost baggage and getting refunds back in a timely manner. We want to thank customers for bearing with us through these and other challenges since we restarted flying. We’re very aware that flying is not currently the pain-free experience it should be and getting back into shape is a key priority. 

“On top of this, air fares are higher than they were pre-Covid. Like many businesses, we’re facing a high inflation environment with increased fuel, labour and other supplier costs at a time when more customers are wanting to travel, and that flows through to ticket prices. 

“A key focus for the team has been bringing back much needed capacity to minimise the impact of higher prices on customers. With six Boeing 777-300ER widebody aircraft now returned into service, three new domestically configured A321neo aircraft delivered and a fully crewed leased aircraft to serve the Auckland-Perth route, we are adding capacity back at pace.” 

Ms Walsh said: “As we look ahead to the second half of this financial year, macroeconomic challenges are front of mind, including the financial impact of inflationary pressures and geopolitical uncertainty. At this moment, however, we are observing demand trends that are offsetting these macro headwinds. Air travel is still in the Covid recovery phase with high levels of demand, and the current capacity and supply chain constraints will limit supply at least in the short-term. The new hybrid work environment has also enabled greater freedom and flexibility for customers which we believe will continue to drive domestic leisure bookings.  

“While we cannot predict the future, we know this new normal we find ourselves in requires great skill and dexterity to navigate. Having now spent the better part of three years dealing with constant change and flux, our people are the very best in the business to deal with anything that comes our way.”  

Geoff Percival
Geoff Percival
Geoff has worked in business, news, consumer and travel journalism for more than 25 years; having worked for and contributed to the likes of The Irish Examiner, Business & Finance, Business Plus, The Sunday Times, The Irish News, Senior Times, and The Sunday Tribune.

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