apr-11.pdf (2.07 MB) - Crown Ownership Monitoring Unit

Major investmentsThe total investment in fixed assetswas $797 million during the year,84% higher than last year. Thisincluded investments in aircraft,spare engines and simulators.Non-financial performanceAir NZ was named the 2011winner of the Ranstad Award asNew Zealand’s most attractiveemployer.OperationsAir NZ’s operating revenue increased by $295 million, up 7.3% on the sameperiod last year to $4.3 billion. This was primarily owing to an increase incapacity (available seat kilometres) of 2.5% and the passenger load factorincreasing by 1.6% to 83.4%. This increase in Air NZ’s overall revenue hasbeen offset by a 3% increase in operating expenditure, excluding the impactsof fuel price and foreign exchange fluctuations, resulting in an EBITDAF of$540.9 million.Financial performanceDespite the increase in operating revenue, Air NZ’s financial performance inthe 2010/11 financial year deteriorated slightly against 2009/10. For 2010/11,passenger revenue increased by $220 million, a 7% increase compared to the2009/10 financial year. Cargo revenue of $278 million for the 2010/11 financialyear (an increase of 9%) was driven by increased cargo capacity on the newB777- 300ER fleet and growth in the southbound market.Net profit after tax for 2010/11 was $80 million compared to $82 million in the2009/10 financial year. The first half of the 2010/11 financial year saw a positiveresult on Air NZ’s performance, mainly driven by an $18 million gain on equityswaps relating to the investment in Virgin Blue Airline. However, performancein the second half of the financial year was significantly affected by the seriesof natural disasters in Canterbury and Japan. These events, combined withsignificantly higher fuel prices, resulted in a loss of $37 million for the secondhalf of the year.DividendsThe Board has declared an unimputed dividend of 2.5 cents per share.This takes the total dividend for the year to 5.5 cents per share. For theCrown, this amounted to dividends of approximately $44.2 million for the2010/11 financial year.Air NZ had an overall capacityincrease of 5.5% in its domestic,Tasman and Pacific Islandmarkets. This was mainly drivenby the increased capacity indomestic New Zealand and theimplementation of the “Seats toSuit” product on the Tasman andPacific Island routes.For the international long haulnetwork, passenger yield was up4.3% and demand was up 1.2%.Overall capacity increased 0.3%and the passenger load factorincreased to 83.9%.Corporate social responsibilityAir NZ provides philanthropicsupport to a number oforganisations, with a focus onnational charitable organisationsthat support children in need,and those whose aim is topreserve New Zealand’s naturalenvironment.Following the Canterburyearthquake in February 2011,Air NZ introduced $50compassionate fares for thosedirectly affected and who neededto travel in and out of Christchurch.page | 65