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New Zealand airline posts sharp profit lift for best result in decade

New Zealand airline posts sharp profit lift for best result in decade

National carrier Air New Zealand reported its strongest result in a decade on Tuesday with a June year net profit lift of 123 percent to 214 million New Zealand dollars (US$153 million; euro112 million).
The airline, 76 percent owned by the government after a 2001 financial bailout, said profit in the fiscal year ended June 30 was more than double the NZ$96 million (US$69 million; euro50 million) recorded in the same period a year earlier.
Operating revenue for the latest year rose over 13 percent to NZ$4.3 billion (US$3.1 billion; euro2.3 billion), it said in a statement.
"This is the strongest result in the past decade and comes off the back of significant growth in passenger revenue, and a continued reduction in unit operating costs," chairman John Palmer said.
Chief executive Rob Fyfe said the past year would go down as one of the most pivotal in the company's history.
Restructuring that had continued since the government bailed out the company after its collapse in September 2001 had started to pay off, he said.
The company had built up strong earnings momentum, particularly in the second half of 2006 and this had carried through into early 2007 with strong forward bookings, Fyfe said.
Passenger numbers had risen 4.9 percent to 12.5 million and this combined with improved yields were the key drivers of the improved revenue performance.
Fyfe said the company's business transformation program had delivered a further NZ$128 million (US$91 million; euro67 million) of savings during the year.
Labor costs as a percentage of revenue fell from 22.7 percent in the 2005-2006 year to 20.6 percent in 2006-2007.
Operating spending (excluding the impact of foreign exchange movements and fuel price rises) had increased by 2 percent against a rise in capacity of 3.1 percent.
Longer term plans to introduce Boeing 787-9 and 777-300ER airplanes would aid growth into the next decade, offer the carrier greater flexibility and allow new routes to be opened, he said.
The government will receive NZ$152 million (US$109 million; euro80 million) of the total dividend payout of NZ$190 million (US$136 million; euro100 million).


Updated : 2021-07-30 13:16 GMT+08:00