Air New Zealand has posted a record profit before tax of NZ$197m (A$181.8m) for the first half of the 2014 financial year, a result it attributes to its ‘Go Beyond’ strategy and stable fuel prices.
Normalised profit before tax for the half was NZ$180m (A$166m), up 29 per cent, while net profit after tax was NZ$140m (A$129m), up 40 per cent, on revenues of NZ$2.3bn (A$2.1bn). The airline says it expects to post a full-year normalised profit of over NZ$300m (A$277m).
“Air New Zealand’s Go Beyond strategy is clear. We have a relentless focus on global sales and marketing excellence, combined with a keen eye on continuously improving our cost base while delivering a world class customer experience,” chairman Tony Carter said.
“As we continue through a period of strong earnings growth, we are demonstrating that we can deliver increasing returns to shareholders. Our improved commercial results are also enabling us to invest in the customer experience, explore new markets and invest in our people and culture,” said chief executive Christopher Luxon.
“We have worked hard on improving our cost base in an environment where we have not grown. In fact, we have reduced our capacity flown overall as we realigned our long-haul network. With new fleet additions and capacity growth, our scale grows. Our new aircraft will be significantly more efficient than those they replace and having fewer aircraft types drives unnecessary complexity out of our operations.”
Highlights of the result include: unit costs down by three per cent; planned capacity growth for the 2015 financial year of eight per cent as 787-9s and new 777-300s are delivered, and a fully imputed dividend of NZ4.5 cents a share.
Luxon also pointed to the strength of the airline’s alliance partnerships. “Forming the right alliances with the right partners allows us to deliver on our strategy of profitable growth as a Pacific Rim airline.”
And he gave a very public vote of confidence in Virgin Australia, which is expected to record its own first half loss on Friday. “Virgin Australia has a sound strategy and I look forward to helping the airline to realise its potential when I join its Board. We are confident that over the coming years Virgin Australia can deliver consistent earnings performance.”