Air New Zealand provides full year earnings guidance

Stock exchange listings: New Zealand (NZX: AIR) / Australia (ASX: AIZ) / ADR (OTC: ANZLY)


MARKET ANNOUNCEMENT

Air New Zealand postal address: Private Bag 92007, Auckland, 1142, New Zealand
Investor Relations email: investor@airnz.co.nz
Investor website: www.airnewzealand.co.nz/investor


19 February 2024

Air New Zealand provides full year guidance on softer forward trading conditions

On 13 December 2023, Air New Zealand updated its first half guidance and cautioned against
extrapolating that guidance to the second half. The airline expected the second half of the financial
year to be increasingly challenging given the ongoing impact of engine maintenance requirements,
economic and inflation risks, and early signs of softness in domestic demand.
The upcoming Interim financial result for the six months ended 31 December 2023 will be
consistent with that 13 December 2023 guidance.
Notwithstanding the January operating statistics which will be released today, Air New Zealand
notes that a number of economic and operational conditions have deteriorated further and are
increasingly expected to have a significant adverse impact on its performance in the second half
of the financial year. These include:
• The airline’s forward bookings profile which indicates that the increased capacity and further
pricing pressure from US carriers is expected to more adversely impact the forward revenue
performance for the remainder of the financial year.
• The cumulative impact of significant inflation on the cost base.
• Ongoing weakness in domestic corporate and government demand.
• Temporary cost headwinds to alleviate operational pressures and customer impacts from the
previously disclosed unplanned Pratt & Whitney global engine maintenance requirements.
These total approximately $35 million for the second half of the financial year and include the
cost of short-term leased aircraft and significant additional contact centre resources.
Air New Zealand will continue to assess the likely impacts and duration of these conditions and
circumstances.
Outlook
In light of these conditions, the airline considers that performance for the second half of the 2024
financial year will be markedly lower than the first half.
In this context, and assuming an average jet fuel price of USD$105/bbl for the second half, the
airline currently expects earnings before taxation for the 2024 financial year to be in the range of
$200 million to $240 million. This range includes $20 million of currently assumed additional Covid-
related credit breakage over the second half. Future redemptions of Covid-related credits remain
uncertain and subject to further actions.

Stock exchange listings: New Zealand (NZX: AIR) / Australia (ASX: AIZ) / ADR (OTC: ANZLY)


MARKET ANNOUNCEMENT

Air New Zealand postal address: Private Bag 92007, Auckland, 1142, New Zealand
Investor Relations email: investor@airnz.co.nz
Investor website: www.airnewzealand.co.nz/investor


The Board notes the airline’s strong liquidity position and remains committed to its Capital
Management Framework announced last August, including its ordinary dividend policy.
The airline will provide further context to the outlook when it releases its Interim results on
Thursday, 22 February 2024.

Ends
This announcement has been authorised for release to NZX and ASX by Jennifer Page, General
Counsel & Company Secretary (jennifer.page@airnz.co.nz).

For investor relations queries, please contact: For media enquiries, please contact:
Kim Cootes, Head of Investor Relations Air New Zealand Communications
kim.cootes@airnz.co.nz media@airnz.co.nz
+64 27 297 0244 +64 21 747 320