Hurtigruten Sep takeover sides
Hurtigruten Sep takeover sides

Air New Zealand flags bigger losses due to trans-Tasman bubble pause

Air New Zealand has forecast losses before significant items and tax to worsen from the previously stated $NZ450 million ($A427 million) to $NZ530 million ($A503 million) this financial year.

Air New Zealand has forecast losses before significant items and tax to worsen from the previously stated $NZ450 million ($A427 million) to $NZ530 million ($A503 million) this financial year.

Air New Zealand is forecasting losses of $NZ530 million ($A503 million) this financial year. The bigger financial hit than expected comes after New Zealand suspended its travel bubble with Australia, causing sales to plummet.

The company updated its estimate after New Zealand suspended quarantine-free travel from July 23 for eight weeks due to COVID-19 outbreaks in Australia.

It said its estimate included the likelihood that customer demand would be slow to recover once travel was allowed again.

The estimate of losses assumes a New Zealand dollar buying 70 US cents, and a fuel price of $US78 per barrel.

Karry On - Air New Zealand Auckland New York

The company has said it intends to borrow more money from a New Zealand government loan facility to help cashflow.

However, the airline still has payments to make. Air New Zealand has already borrowed $350 million from the government and last did so in February.

The government is the major shareholder in the airline and owns a 52 per cent stake.

After the disappointing news that New Zealand cut travel ties with Australia last month, Air New Zealand announced managed return flights to allow Kiwis to return home from New South Wales.

Managed return flights will operate to Auckland, and on arrival, travellers are required go into MIQ for a period of 14 days.

Source: AAP