Contrary to concerns about recent fuel price increases, Air New Zealand is reporting strong positive indicators for its financial outlook. The airline recently updated its earnings guidance for the 2023 financial year, following a previous announcement April 27 2023.
Surprisingly, during what is normally considered the off-peak period for the airline, the demand has remained considerably stronger than usual.
Additionally, US dollar jet fuel prices have experienced a further decline, consistently falling below the projected figures outlined in the April earnings guidance.
With the assumption that an average jet fuel price for June at US $89 per barrel, the airline now forecasts its earnings before significant items and taxation for the 2023 financial year to reach no less than $580 million. This updated projection exceeds the prior guidance range given in April, which predicted earnings to fall between $510 million and $560 million.
Air New Zealand is dedicated in its ongoing investment in its workforce, customer service, and digital capabilities. As mentioned in the interim results February 2023, over the next five years, the airline plans to invest approximately $3.5 billion in aircraft and retrofitting alone.
However, as we move towards the 2024 financial year, the airline remains aware of the unpredictable economic landscape. As more capacity enters the market in the coming months, fares are expected to balance from the current peaks, a careful reminder of the fluctuating dynamics in the aviation sector.
*Air New Zealand will have more information in their annual results due for release August 2023.
