Air New Zealand slashes first-half guidance, expects loss of up to NZD55m
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The news: Air New Zealand has downgraded its outlook for the first half of the 2026 financial year, warning that its target uplift in revenue during the period "has not materialised".
The numbers: The airline now expects a first-half loss before tax between NZD30 million ($26.6 million) and NZD55 million.
It had previously guided for earnings before tax of "similar or less than" the NZD34 million achieved in the second half of FY25.
The company had anticipated a 2% to 3% uplift in revenue across its domestic and US-bound bookings. However, it said this morning that "this has not materialised to date" and is "not yet evident in the current forward booking profile, the impact of which is approximately NZD50 million for the half."
The context: Air New Zealand attributed the downgrade to a "subdued" local economic, with "ongoing softness" across its business, government and leisure segments.
Engine lease costs for the first half are now expected to be around NZD20 million higher than previously expected, it said. This is due to end-of-lease obligations on two short-term aircraft leases not previously included in the outlook.
Meanwhile, the airline's financial obligations under the mandatory Carbon Offsetting and Reduction Scheme for International Aviation have increased by NZD10 million since its August outlook, which will result in increased fuel costs.
Air New Zealand said it is progressing further cost-saving and efficiency initiatives. It is also advocating for affordable airport landing charges and other third-party aviation sector costs to support New Zealand's tourism industry.
What they said: "The airline cautions against extrapolating first-half guidance across the full year, noting that additional capacity growth is planned for the second half," the company said.
"As a result, traditional comparisons between first- and second-half performance may be less indicative of full-year trends for the 2026 financial year."
The source: ASX
