Air New Zealand earnings plunge after disasters

WELLINGTON: Air New Zealand announced a 45 percent slump in annual earnings on Thursday as natural disasters in Christchurch and Japan weighed on the carrier's bottom line.

The airline said normalised earnings before tax in the year to June 30 were NZ$75 million ($62.2 million), while net profit after tax slipped 1.0 percent to NZ$81 million.

The airline said normalised earnings stripped out the impact of measures such as fuel hedging from the annual result.

Chairman John Palmer said the Christchurch earthquake in February and the Japanese quake and tsunami disaster a month later resulted in a significant drop in demand.

"These natural disasters and sustained high fuel prices dramatically altered what was shaping up to be a very positive full year result," he said.

"Nevertheless, this backdrop of adversity has again highlighted the resilience of Air New Zealand in the most challenging of times."

He said the airline recorded a net profit of NZ$112 million in the first half of the financial year but booked losses of NZ$37 million in the second half.

Palmer said the airline expected an improved performance in the current financial year "in the absence of further deterioration in global economic conditions and an escalation in fuel prices".

Air New Zealand shares were up 0.9 percent at NZ$1.12 in early afternoon trading.

Copyright AFP (Agence France-Presse), 2011