Air NZ (NZX:AIR) announces retail bond offer of NZ$75 million

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 Air NZ (NZX:AIR) announces retail bond offer of NZ$75 million
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  • Air New Zealand has made a rights offer of fixed-rate bonds.
  • The offer opens today (17 October) and closes on 20 October.
  • The current bonds quoted on the NZX Debt market will mature on 28 October

Air New Zealand Limited (NZX: AIR), the national carrier of New Zealand, said on Monday (17 October 2022) that it has decided to make a rights offer of unsecured fixed-rate bonds for up to NZ$75 million. The offer is for institutional and NZ retail investors.

As per the announcement made by Air NZ, the offer opens today and closes on 20 October 2022, and the bonds are expected to be quoted on the NZX Debt Market under ticker code AIR030.

Air New Zealand has set the indicative margin range at 1.50% to 1.65% per annum. However, the margin and interest rate will be set following the book-build process. The company said the book build process was expected to be completed by 20 October.

On 29 September, the company noted that its current NZ$50,000,000 unsecured fixed-rate bonds, which are quoted on the NZX Debt market, will mature on 28 October.

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It may be recalled that as a part of its post-COVID-19 strategy, Air New Zealand had focused on having a diverse range of debt sources.

The airline said it had appointed Westpac Banking Corporation as an Arranger, and ANZ Bank New Zealand Limited, Forsyth Barr Limited, Jarden Securities Limited, and Westpac as joint lead managers (JLMs) for the proposed offer.

Air NZ’s FY23 guidance

The company update also said that there were continued forward sales seen in the first three months of the financial year FY23, and the airline was operating at 70% of its capacity of FY19 capacity. The company revealed that bookings on domestic networks were around 105% of pre-COVID-19 levels and corporate bookings were almost close to pre-COVID-19 levels.

Based on the trend and assuming the jet fuel price is approximately US$130/bbl, the airline said it expected earnings before taxes and other significant items for the first half of FY23 to be in the range of NZ$200 million to NZ$275 million.

 Additionally, the airline said that the second half of the year remained uncertain regarding demand. Therefore, the company did not provide its full-year guidance.

Stock price

On 17 October, the stock of Air New Zealand was trading down 0.67% to NZ$0.745 at the time of writing this article.


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