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Air New Zealand has returned a solid half-year result despite its ongoing fleet and maintenance issues.
The Kiwi carrier posted a net post-tax profit of NZ$106 million for the first half of the 2025 financial year off the back of NZ$155 million in pre-tax earnings, towards the upper end of its guidance from November 2024.
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The result comes even as Air New Zealand’s fleet remains beset by supply chain headaches that have delayed aircraft deliveries and forced its existing planes out of action for extended periods as they wait for engine parts, resulting in the axing of services including seasonal flights to Seoul.
“This is a strong result when you consider the headwinds we have been navigating for almost a year now,” the airline’s chair, Dame Therese Walsh, said.
“It reflects the hard mahi and dedication of our 11,600-strong Air New Zealand whānau and the effectiveness of the actions we have taken, and continue to take, to mitigate these challenges and position the airline for future success.”
According to CEO Greg Foran, the airline has received NZ$94 million in compensation from engine manufacturers Rolls-Royce and Pratt & Whitney for the ongoing issues. He estimated that earnings would have been $40 million higher had it been able to operate all its aircraft as intended.
“Investment in modern, fuel-efficient aircraft is an important part of Air New Zealand’s fleet strategy. But with over $1 billion worth of our newest, most efficient aircraft grounded at times, it’s been a tough year so far,” he said.
“Delivering the performance we have and maintaining such a strong balance sheet is a real credit to our people and I’m proud of what we have achieved.
“While compensation has played an important role in offsetting some of the financial impact of the delays, it falls well short of making the airline whole for the operational and economic losses sustained.
“We strive to deliver a reliable experience for our customers; however, with four percent less capacity available largely due to the engine maintenance delays, this has been a real challenge for the airline.”
Foran warned that second-half performance is likely to be lower than the first half, with up to six narrow-body and five wide-body jets out of service at any one time.
“This is a significant volume of aircraft to have on the ground, but we continue to take steps to build resilience into our operations through schedule adjustments, leasing additional engines, and prioritising customer experience improvements,” he said.
“Despite these challenging times, there is much to look forward to in the coming months.
“The road ahead is not without obstacles, but our balance sheet strength, our clear strategic priorities, and the skill and commitment of our team position us well to navigate the year ahead.”
Last October, Air New Zealand began the retrofitting program on its Dreamliner fleet, saying it will be the first airline in the world to refit a 787-9 from nose to tail.
These retrofits, which will be performed on all 14 of Air New Zealand’s existing 787-9s, will not add the new Skynest economy sleeping pods; these will instead feature on its eight new Dreamliners expected to arrive from this year. The airline was the launch customer for the 787-9 in 2014.
