Air NZ faces toughest operating conditions in 10 years
Contributors are not employed, compensated or governed by TD, opinions and statements are from the contributor directly
Air New Zealand results for the Financial Year 2011, ending 30 June, showed a 45% year-on-year decline in pre-tax earnings. A comparison of first and second half profits clearly illustrate the impact of natural disasters and rising fuel prices on the Air NZ performance. In the first six months, the carrier recorded NZ$112 million (US$93 million) in net profits compared to NZ$36 million in the second half.
Chief Executive Officer Rob Fyfe says the operating conditions of the past six months were cumulatively the most difficult Air New Zealand has faced in the past decade. “The combination of reduced demand for travel as a result of the devastating Christchurch and Japan earthquakes, additional capacity into Christchurch to assist the relief effort and compassionate fares for those affected by the Christchurch earthquakes resulted in an estimated NZ$70 million negative impact on earnings,” said Fyfe.
Despite the slide in profits, however, the airline orchestrated an improved operating performance through the 12 months. Air NZ reports an increased share in the market, with demand up 10.2% and load factors increasing 2.9 percentage points to 83.3%, compared to the 2010 financial year. Airline executives, therefore, are confident of improved results barring further deterioration of economic conditions.
Comments are closed.