Air New Zealand, revenue, record, profit, 2018, tourism, travel, neo, pacific, flights, Taiwan, Singapore, Chicago
Air New Zealand Hobbit aircraft

Air New Zealand to reinvest massive profit

The second highest profit in Air New Zealand’s history means investment in the “customer experience” and staff bonuses.

Air New Zealand says it will plunge the second highest profit in its history back into the company, into both the customer experience and staff bonuses.

The company’s earnings before taxation for the 2018 financial year stood at $540 million (€310 million), an increase from the previous year’s result of $527 million. Net profit after taxation grew by 2.1% to $390 million.

Investment of around $150 million is expected over the next four years to “enhance customer experience in key areas”, the airline says, including refreshed cabins, digital products and lounges.

The airline also committed to a third short-term leased widebody aircraft to further assist with its schedule reliability during ongoing maintenance requirements associated with the global Rolls-Royce Trent 1000 engine issues.

Staff bonuses were also revealed on the back of the results, of up to $1,800 for all permanent employees who do not already participate in the carrier’s Short Term Incentive programme, about 8,500 of them.

“This is an impressive financial result, driven by strong revenue growth across the airline’s key markets, as well as continued focus on sustainable cost improvement, despite significantly higher fuel prices,” commented the airline’s chairman, Tony Carter.

“The ability of the airline to achieve its second highest profit in such a challenging environment really speaks to the focused strategy and unique competitive advantages that Chief Executive Officer Christopher Luxon and his leadership team have spent years building.”

What’s next?
The carrier says that “2019 promises to be an exciting year for the airline and its customers, as Air New Zealand will offer more cheap fares than ever over the next year as domestic jet capacity grows by three to five percent and regional turboprop capacity grows by five to seven percent”.

This year will see the launch of new direct services to Chicago and Taipei commencing in November, new services to Brisbane from both Wellington and Queenstown from December, and a new third daily service added to Auckland-Singapore in partnership with Singapore Airlines.

The airline is expecting delivery of ten Airbus A320/321 neo aircraft, which “will provide continued growth and cost benefits to the Tasman and Pacific islands network”. Air New Zealand will be the first airline to fly the neo in Australasia.

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