Air New Zealand Ltd has recorded a first-half pretax loss of NZ$185 million ($136.97 million) and forecast a significant loss for 2021 due to a sharp fall in travel associated with the coronavirus pandemic.
The airline has benefitted from a recovery in domestic travel due to New Zealand's near-eradication of COVID-19. However, its international border remains closed and a two-way travel bubble with neighbouring Australia is yet to be approved.
New Zealand's flag carrier said that its domestic capacity is running at approximately 76% of pre-pandemic levels, helped by robust local tourism and return of business demand during the first half.
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"The airline remains optimistic about the future, and, after making both short and long-term changes to the business to lower the cost base, is well positioned for recovery when demand returns," Air New Zealand chief executive Greg Foran said.
Air New Zealand did not provide an earnings guidance range for 2021, citing uncertainty around the lifting of travel curbs, but said that it will make a "significant loss" despite strong domestic and cargo performance.
It expects to burn approximately NZ$45 million to NZ$55 million of cash for the remaining five months of fiscal 2021, lower than the average of approximately NZ$79 million a month from September 2020 to January 2021.
The loss before tax and exceptional items of NZ$185 million in the six months that ended on December 31, 2020, which is its most closely-watched financial figure, is compared with a NZ$198 million profit a year earlier.
On a statutory basis, it swung to a NZ$104 million loss from a NZ$139 million profit in the prior year.
Cash-Flow Positive Since Start Of Q2
The airline's chief financial officer said that its cash-flow has been positive since the start of the second quarter of its current financial year.