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Air New Zealand warns of virus impact as profits dive
[WELLINGTON] Air New Zealand announced a 34 per cent fall in interim net profit on Thursday and warned the novel coronavirus would hit the airline's bottom line as it slashes flights on Asian routes.
The flag carrier posted a net profit of NZ$101 million (S$88.9 million) for the six months to December, down from NZ$151 million in the same period a year earlier.
It said the interim result reflected weaker demand, a sluggish global cargo market and the impact of ongoing political unrest in Hong Kong.
Chief executive Greg Foran said the airline was taking steps to minimise the virus' impact but full-year results would be affected.
Mr Foran said flights to Shanghai and Seoul had already been temporarily suspended and services to Japan and Hong Kong were also being cut back.
He said overall flights to Asia between February and June would be down 17 per cent as a result.
Mr Foran said the airline had proved resilient in the past and would deal with changed market conditions caused by the virus.
"We have a highly capable and experienced senior leadership team who have dealt with challenges such as this before and I am confident that we will effectively navigate our way through this," he said.
The airline forecast pre-tax earnings of NZ$300-350 million for the full financial year, down from its previous estimate of NZ$350-450.