Air NZ promises more cheap fares
Air New Zealand posted its second-highest pre-tax annual profit and will pay a bonus of $1800 to permanent staff not in a short-term incentive programme.
The airline has copped criticism for pulling out of destinations such as Ka¯piti, north of Wellington, but is promising further domestic growth with the announcement of plans to buy seven Airbus A321 Neo aircraft to fly high-demand routes.
And passengers can look forward to more cheap airfares.
‘‘In 2019, we will offer more than 2.9 million seats for travel in New Zealand for under $100,’’ Air New Zealand chief executive Christopher Luxon said.
This year will also see the launch of new direct services to Chicago and Taipei from November, new services to Brisbane from Wellington and Queenstown beginning in December, and a new third daily service added to the Auckland-singapore route in partnership with Singapore Airlines.
Air New Zealand will also invest about $150 million in the next four years in aircraft cabins, digital products and lounges.
Profit after tax rose 2.1 per cent to $390m, while profit before tax was up 2.5 per cent at $540m.
Shareholders will receive an 11-cent dividend, bringing the total dividend to 22c per share, an increase of 4.8 per cent. The Government owns 52 per cent of the airline.
Chairman Tony Carter said the financial result demonstrated the airline’s ‘‘resiliency’’.
He said the airline achieving its second-highest profit in such a challenging environment ‘‘really speaks to the focused strategy and unique competitive advantages’’ that Luxon and the leadership team had ‘‘spent years building’’.
‘‘In recognition of the robustness of the 2018 result, the board has awarded staff bonuses of up to $1800 to be paid next week to approximately 8500 Air New Zealanders who do not have other incentive programmes as part of their employment agreement.’’
Luxon said external disruptions had affected the airline’s operational performance.
To improve reliability it would lease three more wide-body aircraft – two Boeing 777-200s and one Boeing 777-300 – as it works through the maintenance associated with the global Rolls Royce Trent 1000 engine issues.
‘‘We do not take our customers’ choice to fly with Air New Zealand for granted and remain focused on making improvements across all touch points of their travel journey,’’ Luxon said.
But the airline also signalled next year could well be tougher, forecasting that pre-tax profit in could drop to between $425m and $525m as schedule changes resulting from issues with the Rolls Royce engines on its Boeing 787-9 Dreamliner fleet could cost an estimated $30m to $40m.
Luxon said there were strong forward bookings heading into the peak summer season.
Over the next two years, the airline expected to grow by 1 million passengers a year, reaching 19 million by the end of 2020.