Air New Zealand Fuel Hedge Disclosure as at 15 Nov 2017

Units
FY18 Q2
FY18 Q3
FY18 Q4
FY19 Q1
FY18H1
FY18H2
Oct-Dec
Jan-Mar
Apr-Jun
Jul-Sept Jul - Dec 2017 Jan - Jun 2018
Brent Collars
Volume
Barrels
1,700,000
1,360,000
945,000
575,000
3,395,000
2,305,000
Ceiling Price
USD
55.34
53.20
51.51
60.76
55.78
52.51
Floor Price
USD
44.76
44.65
42.98
47.70
43.76
43.96
Brent Call Spreads*
Volume
Barrels
897,500
75,000
2,260,000
75,000
Bought Call
USD
51.73
53.13
49.16
53.13
Sold Call
USD
57.44
58.00
56.67
58.00
Brent Swaps
Volume
Barrels
37,500
262,500
375,000
37,500
637,500
Price
USD
49.00
49.14
49.48
49.00
49.34
Bought Brent Puts**
Volume
Barrels
600,000
125,000
925,000
125,000
Strike Price
USD
40.63
40.00
40.49
40.00
Barrels
1,737,500
1,622,500
1,320,000
575,000
3,432,500
2,942,500
Barrels
2,222,441
2,307,202
2,125,429
2,400,000
4,517,794
4,432,631
78%
70%
62%
24%
76%
66%
USD
12,850,030
15,405,552
14,154,732
3,126,009
18,416,413
29,560,284
USD
(5,962,150)
(3,574,400)
(2,062,050)
(1,387,625)
(13,189,000)
(5,6
36,450)
USD
6,887,880
11,831,152
12,092,682
1,738,384
5,227,413
23,923,834
Notes:Brent spot was US$62 and 12 month Brent was US$60. As at 15 No
vember 2017, Air New Zealand had no WTI or Singapore jet hedges
.
Periods relate to the month of consumption. Air New Zealand do
es not use three way call structures or leveraged collar struct
ures.
* Brent Call Spreads lower the ce
iling price of existing collar
structures.
** Bought Brent Puts allow Air New Zealand to benefit if oil pr
ices fall under the strike price.
(1)

Compensation from fuel hedges is the sum of the mark-to-market
value of all fuel options and swaps as at 15 November 2017.
·

The effective portion of changes in the intrinsic value and tim
e value of fuel derivatives is recognised through Other Compreh
ensive Income; and
· Any accounting ineffectiveness is recognised through earning
s.
V
olume:
Fuel volume is reported in barrels for passenger aircraft (42 U
S gallons in a barrel).
Price:
Price is quoted in USD cost per barrel of Brent.
Page 1 of 2
Air New Zealand Limited
(2) Net compensation from fuel hedges represents the unrealised
gains and losses on fuel hedges
. These gains and losses will b
e accounted for in line with Air New Zealand Limited’s fuel ins
trument accounting
policy:
Fuel Hedge Position as at 15 November 2017
Hedged volume as proportion of totalTotal hedged volumeNet compensation from hedges (2)Purchase cost of optionsCompensation from fuel hedges (1)Estimated fuel consumption

Page 2 of 2
0%10%20%30%40%50%60%70%80%90%
$30$35$40$45$50$55$60$65
FY18 Q2
Oct - Dec
FY18 Q3
Jan - Mar
FY18 Q4
Apr - Jun
FY19 Q1
Jul-Sep
Hedged % of estimated jetfuel consumption
US$ per barrel
Fuel hedge position(as at 15 November 2017)
Hedge percentage
Brent Collar Ceiling(adjusted for call spreads)
Brent Collar Floor