Air New Zealand forecasts FY24 first-half earnings

Air New Zealand has provided initial earnings guidance for the first half of FY24.

The airline has noted solid customer demand in most markets, but domestic travel, particularly corporate and government travel, has been soft.

Jet fuel prices and the weaker New Zealand dollar have also increased costs.

The airline expects the previously disclosed Pratt & Whitney engine issues to impact its flying schedule in the second half of FY24, but the financial impact in the first half is expected to be minimal.

The airline expects earnings before taxation for the first half of FY24 to be in the range of $180 million to $230 million, assuming an average jet fuel price of US$110/bbl.

The airline still holds approximately $200 million in Covid related credits and is making efforts to contact customers for redemption.

The airline cautions against extrapolating the first half earnings guidance to the full year due to uncertainties in the trading environment.