August 26 Air New Zealand Ltd forecast strong earnings growth in the current year as it posted record annual net profit thanks to more passengers and lower fuel prices.
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Air NZ says its Auckland hub is a convenient transit point for Australian passengers from Melbourne, Brisbane, Adelaide and Perth that would otherwise have to transfer in Sydney on routes other than Melbourne-Los Angeles and Brisbane-Los Angeles.
Documents filed by Qantas and American Airlines, which are seeking to deepen their trans-Pacific partnership, show Air NZ past year had a 5.7 per cent share of traffic between Australia and the US, including Hawaii, and a 10.8 per cent share of traffic between Australia and Canada.
“Our investment in new, efficient aircraft, the continued development of our alliance partner relationships, world class sales and marketing execution, great customer service and strong focus on cost management have enabled Air New Zealand to achieve revenue growth against a stable cost base”, he said. “And while we are gearing up to launch these exciting new routes we have a team assessing potential new opportunities in Australia, Asia and the Americas”, Mr Luxon says.
While he had reservations about the rival airline moving into the route, Luxton said it would be met with strong competition from Air New Zealand.
Chairman Tony Carter said the airline’s strategic initiatives in the past three years had positioned it well to take advantage of market dynamics.
A fully imputed final ordinary dividend of 9.5 cents a share, an increase of 73%, was declared. The airline also confirmed it expected to achieve “significant earnings growth” in the current financial year given the known operating environment.
Reporting a record annual result for 2015, today the airline, which is already noted for its adoption of and innovation with digital technologies, said it had set itself the objective to “unleash digital transformation” for customers, sales channels and operations. “I think we are going to compete very strongly”.
Air NZ’s push for more Australians on trans-Pacific flights could come partly at the expense of Virgin Australia Holdings, in which it owns a 25.99 per cent stake. The company said it plans to add routes to Houston and Buenos Aires over the coming year as it expands its global capacity by 15 percent. The airline has saved $74 million during the past year and expects to save around on $300 million on fuel during the coming year.
In that cause, Air New Zealand is replacing the CIO role with a that of a chief digital officer reporting to the chief executive.
“Air New Zealand will deliver more personalised and relevant offers to its customers in the future through the use of data and analytics”.
“Our people are critical to the airline’s success”.
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Membership of Air New Zealand’s loyalty programme, Airpoints, was up 17 per cent at 1.9 million, with Australia the biggest overseas group of members, up 20 per cent in th year, Luxon said.
