Air New Zealand posts first annual loss since 2022 amid fuel and engine woes

Air New Zealand has swung to a pre-tax loss of NZ$336 million ($200 million) for the year ended 30 June, its first annual loss since fiscal 2022, when the carrier was still recovering from the pandemic downturn.

The airline said the result followed several years of declining profitability driven by engine issues affecting both its widebody and narrowbody fleets. Those engine availability problems, which the carrier believes are close to being resolved, cost it an estimated NZ$190 million in revenue over the year.

A separate fuel price spike added further pressure, costing the airline about NZ$135 million after accounting for fare increases and capacity reductions made in response. Air New Zealand also pointed to higher costs tied to landing, air navigation and passenger service charges as contributing factors.

The loss stands in contrast to Qantas, which reported a profitable full year a day earlier despite also facing higher fuel costs, according to the source material.

New Zealand's prime minister, Christopher Luxon, a former chief executive of the airline, commented on the results at a press briefing, reportedly describing them as a very poor outcome and saying he expected the carrier, which is partly government-owned, to improve quickly.

The brief does not detail specific remedial steps the airline plans to take beyond resolving the engine issues, nor does it specify a timeline for a return to profitability.