Air New Zealand Investor Update (Op Stats) – January 2024

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Contents
• January 2024 traffic highlights and commentary
• Operating statistics table
• Recent market announcements


January 2024 Commentary

• The overall increase in Group capacity was largely driven by resumption of the international
network following the full re-opening of New Zealand’s borders post-Covid. Long-haul
international ASKs increased 21.4%, short-haul international ASKs increased 15.4%, while
domestic ASKs were down slightly (4.1%) compared to last year.
• The decline in Group YTD RASK compared to the prior year was driven by the significant
mix change for the 2024 financial year to date, whereby long-haul capacity growth and load
factors were substantially higher relative to short-haul.
• Short-haul YTD RASK, which includes the Domestic, Tasman and Pacific islands networks
declined 6.6% compared to last year. This was driven by a Tasman and Pacific islands YTD
RASK decline, offset by a small increase in Domestic YTD RASK despite a yield decline
from higher loads. It should be noted that the prior comparative period for domestic included
the Auckland flood event which had significant impact on revenue
• Long-haul YTD RASK declined 15.9% driven by both North American and Asian routes.
Intense international competition features heavily in the current trading environment,
particular for North America. US competitors have not yet returned to China at scale, and
for now have directed some of that additional capacity to the New Zealand market, putting
pressure on yields.
• As previously disclosed in market announcements dated 12 October 2023 and 13 December
2023, it is expected that approximately $45 million in Covid-related credits will be applied to
passenger revenue in the 2024 interim financial results. These credits are not allocated to
a particular route group in this document and therefore are not included within the Jan YTD
operating statistics information provided on page 2.














19 February 2024

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January 2024 highlights


















Group traffic summaryJANUARYFINANCIAL YTD
FY24 FY23% *20242023% *+
Passengers carried (000)1,2551,1974.9%9,6069,1495.5%
Revenue Passenger Kilometres(m)2,7702,5229.9%20,23815,76229.0%
Available Seat Kilometres (m)3,3012,86715.1%24,70617,99337.9%
Passenger Load Factor (%)83.9%87.9%(4.0 pts)81.9%87.6%(5.7 pts)
Year-to-date RASK
1
vs 2023vs 2023
Group
(15.7%)(15.9%)
Short Haul(6.7%)(6.6%)
Long Haul(16.3%)(17.0%)
% change in reported
RASK (incl. FX)
% change in reported
RASK (excl. FX)
1 Reported RASK (unit passenger revenue per available seat kilometre) is inclusive of foreign currency impact, and underlying
RASK excludes foreign currency impact.
* % change is based on numbers prior to rounding
Please note that the available seat kilometre (capacity) numbers included in the tables within this disclosure do not include
any cargo-only flights. This is because these capacity numbers are used to calculate passenger load factors and passenger
RASK
+ The month to date percentage movements have been adjusted on a daily weighted average basis. The adjustment takes into account
the difference in days for the accounting month of July 2022 (31 days) compared with July 2023 (30 days). This is because Air New
Zealand operates on a 4,4,5 accounting calendar but closes the annual accounts on 30 June.

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Operating statistics table


GroupJANUARY
FINANCIAL YTD
FY24 FY23% *20242023% *+
Passengers carried (000)1,2551,197
4.9%
9,6069,149
5.5%
Revenue Passenger Kilometres(m)2,7702,5229.9%20,23815,76229.0%
Available Seat Kilometres (m)3,3012,867
15.1%24,706
17,99337.9%
Passenger Load Factor (%)83.9%87.9%(4.0 pts)81.9%87.6%(5.7 pts)
Short Haul TotalJANUARYFINANCIAL YTD
FY24
FY23
% *
20242023% *+
Passengers carried (000)1,1051,0624.1%8,4668,4181.1%
Revenue Passenger Kilometres(m)1,2731,1659.3%9,0038,4906.5%
Available Seat Kilometres (m)1,463
1,3538.1%10,7139,75210.4%
Passenger Load Factor (%)87.0%
86.1%0.9 pts84.0%87.1%(3.1 pts)
DomesticJANUARYFINANCIAL YTD
FY24 FY23% *2024
2023% *+
Passengers carried (000)771
770
0.1%6,2306,449(2.9%)
Revenue Passenger Kilometres(m)4164160.1%3,2423,367(3.3%)
Available Seat Kilometres (m)486507(4.1%)
3,8383,887(0.8%)
Passenger Load Factor (%)85.7%82.0%3.7 pts84.5%
86.6%(2.1 pts)
Tasman / PacificJANUARYFINANCIAL YTD
FY24
FY23
% *20242023% *+
Passengers carried (000)33429214.6%2,236
1,96914.1%
Revenue Passenger Kilometres(m)85774914.4%5,761
5,12313.0%
Available Seat Kilometres (m)977
846
15.4%6,8755,86517.8%
Passenger Load Factor (%)87.7%88.5%(0.8 pts)83.8%
87.4%(3.6 pts)
Long Haul TotalJANUARYFINANCIAL YTD
FY24
FY23
% *
20242023% *+
Passengers carried (000)15013510.9%
1,14073156.8%
Revenue Passenger Kilometres(m)1,4971,35710.4%11,2357,27255.2%
Available Seat Kilometres (m)1,838
1,514
21.4%13,9938,24170.6%
Passenger Load Factor (%)81.5%89.6%(8.1 pts)80.3%88.2%(7.9 pts)
As i aJANUARYFINANCIAL YTD
FY24 FY23% *20242023
% *+
Passengers carried (000)745925.9%59730795.4%
Revenue Passenger Kilometres(m)66452526.5%5,2492,71894.0%
Available Seat Kilometres (m)780
59331.6%6,2853,145100.7%
Passenger Load Factor (%)85.2%88.6%(3.4 pts)83.5%86.4%(2.9 pts)
Americas / UKJANUARYFINANCIAL YTD
FY24 FY23% *20242023% *+
Passengers carried (000)7676(0.6%)543
424
28.8%
Revenue Passenger Kilometres(m)
833
832
0.2%
5,9864,554
32.1%
Available Seat Kilometres (m)1,05892114.9%7,7085,09652.0%
Passenger Load Factor (%)78.7%90.3%(11.6 pts)77.7%89.4%(11.7 pts)
* % change is based on numbers prior to rounding
+ The year to date percentage movements have been adjusted on a daily weighted average basis. The adjustment takes into account the difference in
days for the accounting month of July 2022 (31 days) compared with July 2023 (30 days). This is because Air New Zealand operates on a 4,4,5
accounting calendar but closes the annual accounts on 30 June.
Air New Zealand operates primarily in one segment, its primary business being the transportation of passengers and cargo on an integrated network
of scheduled airline services to, from and within New Zealand. The following operational data and statistics is additional supplementary information
only.

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Market Announcements
(during the period 31 January 2024 to 19 February 2024)
Air New Zealand provides full year guidance on softer 19 February 2024
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.

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.