Air New Zealand (AIR) H1 2026 earnings summary

Executive summary

• Reported a net loss after tax of NZD 40 million and a loss before tax of NZD 59 million for the half, reflecting ongoing fleet constraints, cost inflation, and slower domestic demand recovery, despite a slight increase in passengers flown to 8.1 million compared to the prior year.

• Passenger revenue grew 3.6% year-over-year to NZD 3.0 billion, but capacity remained flat at about 90% of pre-COVID levels due to engine maintenance disruptions and grounded aircraft.

• No interim dividend declared, consistent with the capital management framework and focus on balance sheet resilience.

• Transformation initiatives delivered NZD 45 million in benefits in the half, but these gains were largely offset by inflation and inefficiencies.

Financial highlights

• Operating revenue rose 1.2% year-over-year to NZD 3.4 billion, with premium cabin revenue up 10% and economy up 2%.

• Received NZD 55 million in engine compensation, but this covered only about one-third of the estimated NZD 145 million impact from engine issues.

• Reported CASK rose 7.7% year-over-year due to cost inflation and subscale operations.

• Liquidity at period end was NZD 1.3 billion, within the target range; net debt-to-EBITDA at 2.6x, slightly above target.

Outlook and guidance

• Second-half earnings expected to be broadly in line with or modestly below the first half, assuming average jet fuel price of $85/bbl.

• Full-year non-fuel cost inflation forecast at NZD 150 million–NZD 175 million, with maintenance and passenger services as main drivers.

• Capacity growth of 3%-4% planned for the second half, contingent on improved engine reliability and new aircraft deliveries.

• Material uncertainty remains around engine return schedules, compensation timing, and input cost volatility.