Air New Zealand says availability issues with Pratt & Whitney PW1100G and Rolls-Royce Trent 1000 engines negatively impacted its operational and financial performance in its 2024 financial year.
In the last six month of the financial year to 30 June, maintenance on PW1100Gs meant “that up to six of the airline’s newest and most efficient Airbus [A320neo-family] aircraft have been out of service at times,” says the carrier in its full-year financial results.
The grounded jets made up a significant portion of both sub fleets: as of 30 June Air NZ had 18 A320neo family jets and 14 787-9s.
Slowing domestic demand also proved challenging in the second half, with weakness in both corporate and government travel.
“These issues, alongside elevated competition from US carriers and the cumulative effect of high inflation, have had a significant impact on the airline’s operational and financial performance for the 2024 financial year,” says Air NZ.
Full-year pre-tax profits came in at NZ$222 million ($139 million), down 61.3% from a year earlier, when the carrier had benefited from the post-pandemic travel opening. Net profits also fell, dropping 65% to NZ$146 million.
Air NZ carried 16.5 million passengers in the 12 months to 30 June, up 4%. This trailed the 23% growth in capacity, measured in available seat kilometres, for passenger flights. Load factors fell 3.2 percentage points to 81.5%.
Cargo revenue fell 27% to NZ$459 million but was still 18% higher than before the pandemic. The carrier notes that in its 2023 financial year it also benefited from NZ$98 million in government support for cargo flights.
Cargo yields fell 30%, as the airline saw increased competition from international carriers.
As of 30 June, Air NZ had a fleet of 110 aircraft, which it sees growing to 115 by the end of its next financial year. Additions will include a single 777-300ER, two A320neo-family jets, and a pair of ATR 72-600s.
“Air New Zealand has outlined today a number of trading conditions that have significantly impacted the result for the second half of the 2024 financial year, in particular the tougher economic backdrop in New Zealand driving softness in demand, the cumulative impact of inflationary cost pressures, the impacts of aircraft availability issues and significant competition on its US network,” says Air NZ.
The airline expects the tougher trading environment to continue in the six months to 31 December and offers no profit guidance for the coming financial year.
