- Air New Zealand has stated that it is providing more than 140,000 domestic one-way fares for under $60. Notably, fares are available for travel in 2H of November through to 1H of February 2021.
- Air New Zealand appointed Leanne Geraghty to the position of Chief Customer and Sales Officer.
- AIA recently stated that, for financial year 2021, capital expenditure is anticipated to be in the range of $250 million - $300 million.
COVID-19 pandemic has brought the travel industry to a halt all around the world. A new report that uses UNWTO data pointed out that up to 120 million tourism jobs are at risk. The economic damage induced by COVID-19 is expected to be more than US$1 trillion in 2020.
The World Tourism Organisation anticipates international tourism receipts to fall between US$910 billion and US$1.2 trillion in 2020, setting the global tourism industry back by 20 years.
The trans-Tasman bubble has been in discussions since May. However, there have been community outbreaks in Australia and New Zealand.
Let's have a closer look at how Air NZ and Auckland Airport have been doing in the country.
Air New Zealand
At the end of the trading session on 23rd October 2020, the share price of AIR stood at $1.53 per share, which implies a rise of 1.32% on an intraday basis.
Air New Zealand (NZX: AIR) posted a loss before tax and other significant items of $87 million for the year 2020. The loss was due to the unprecedented impact of coronavirus on its business due to travel and border restrictions that began in March.
The Group reported a robust interim profit of $198 million for the initial 6 months of the financial year. However, coronavirus restrictions led to a 74% decline in passenger revenue from April 2020 to June 2020 compared to the previous year, resulting in operating losses for the airlines.
Some of the highlights of the results of the Company for August 2020 are as follows:
- Passengers carried fell from 1.3 million in August 2019 to 0.35 million in August 2020, down by 73.6%.
- Passenger load factor fell from 83.3% in August 2019 to 36.5% in August 2020.
Source: AIR’s Monthly Investor update, dated: 7 October 2020
The Crown Standby Facility (“CSF”) has started to be drawn down and offers the company required liquidity support as it works on the plan for future shape as well as size of its business post coronavirus.
In a trading update dated 25 September, Air New Zealand stated that the Company has been assessing various situations on how the COVID-19 pandemic may develop and affect business operations, operating cost structure, fleet and capital needs.
Further, the NZ government has restated its promise to sustain its majority shareholding in the airline, and the Board is taking part constructively with the Crown in capital structure and funding talks.
Air New Zealand also hired Leanne Geraghty to the recently created spot of Chief Customer and Sales Officer. However, Chief Financial Officer Jeff McDowall confirmed to leave the airline towards the middle of 2021 after the completion of the planned capital raise.
Auckland International Airport Limited
At the end of the trading session on 23rd October 2020, the share price of AIA stood at NZ$7.36 per share, which implies a fall of 0.27% on an intraday basis.
Auckland International Airport (NZX: AIA) witnessed the most challenging 6 months ( Jan 2020-June 2020) in the history of 54 years. There were tough aviation and tourism operating conditions.
Some of the highlights of the results of the Company for FY20 ending 30 June 2020 are as follows:
- Underlying profit after tax fell by 31.4% to $188.5 million while Operating EBITDAFI was down by 53.1% to $260.4 million.
- AIA's revenue declined by 23.7% to $567 million.
- The total number of passengers fell to 15.5 million, down 26.5% on the previous year.
- AIA cancelled the payment of final dividend.
Monthly Traffic Update (September 2020) (Source: Company Reports)
Chief Executive, Adrian Littlewood, stated that AIA made a tough decision to reduce the size of its workforce due to a substantial drop in the number of passengers and scaling down of the infrastructure development programme of the company. These adjustments have resulted in a 25% decrease in the number of workers and contractors employed by AIA, as of 30 June 2020.
The monthly traffic update for September 2020 showed that AIA's total passenger volumes decreased by 76.9% in the month compared to last year. The fall in total passengers reflects the impact of travel restrictions which were imposed by NZ Government in response to COVID-19.
DON’T MISS: Will Tourism Sector See The Light Of The Day?
Domestic passenger numbers rose by 63.4% in September 2020 compared to the previous month, reflecting the change in the country's alert levels at the end of August as Auckland moved to Alert level 2 on 31 August.
(NOTE: Currency is reported in New Zealand Dollar, unless stated otherwise)
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