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Air New Zealand reported a loss of $87 million for the 2020 financial year, compared to earnings of $387 million in the prior year.
The 2020 result, affirming the unprecedented effect of the Covid-19 pandemic on its business and the global aviation industry following extensive travel and border restrictions which commenced from March.
Despite reporting a strong interim profit of $198 million for the first six months of the financial year, and seeing positive demand on North American and regional routes early in the second half, Covid-related travel restrictions resulted in a 74 percent drop in passenger revenue from April to the end of June compared to the prior year, which drove the airline’s operating losses.
Statutory losses before taxation, which include $541 million of other significant items, were $628 million, compared to earnings of $382 million last year. Non-cash items of $453 million reflected most of the other significant items, including the $338 million aircraft impairment charge related to grounding of the Boeing 777-200ER fleet for the foreseeable future.
Short-term liquidity as at 25 August 2020 was approximately $1.1 billion, made up of cash and the $900 million standby loan facility from the New Zealand Government.
Cash burn averaged approximately $175 million per month from April to June, including higher than average refunds, redundancy payments and fuel hedge close out costs, but this reduced to $85 million for July.
– Operating revenue of $4.8 billion, down 16 percent on the prior year as a result of travel restrictions due to Covid-19
– Total network capacity decline of 21 percent compared to the prior year
– Cargo revenue of $449 million, up 15 percent on the prior year
– Loss before other significant items and taxation of ($87) million
– Loss before taxation of ($628) million
– Board has determined not to declare a final dividend for the 2020 financial year, given current financial pressures
– Short-term liquidity of $1.1 billion at close of business 25 August 2020, (including funds available under the Government standby loan facility which has not yet been utilised)