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Air NZ profits lift-off third year in a row

Air New Zealand has paid a special dividend on the release of strong profit results up 30% for the year ending June 30.

Air New Zealand has paid a special dividend on the release of strong profit results up 30% for the year ending June 30.

The airline posted NZ$332 million in normalised earnings before tax, and net profit after tax of NZ$262 million. The airline will also pay a special dividend of NZ10 cents per share on top of its final dividend of NZ5.5 cents a share, up 25%.

Attributing the profit jump, its third year in a row, to better aircraft and routing, choosing the right alliance partners, cost management and a renewed focus on its customers, Chairman Tony Carter said.

“We have made significant progress on our key strategic initiatives. With new aircraft offering better operating economics, an optimised network with the right alliance partners, disciplined cost management and a daily focus on improving the customer experience, we are very well positioned to continue growing.”

“Based on our current expectations of market demand and fuel prices, we expect to improve on the 2014 result in the coming year. This outlook excludes equity earnings from the Virgin Australia shareholding,” Mr Carter said.

“A successful Air New Zealand is good for everyone – it is a virtuous circle. As we grow our revenue and control costs, we generate strong financial results which lead to sustainable returns to shareholders and investment back in the business,”

Chief Executive Officer Christopher Luxon.

Mr Luxon said new initiatives including the induction of its Boeing 787-9 fleet, refurbishment of its Boeing 777-200ER fleet and moving to new terminals and lounges in LA and London will further improve customer experiences.

Regarding Air New Zealand’s recently approved alliance with Singapore Airlines, Mr Luxon said it will provide the carrier a new platform for sustainable growth “allowing us to open up new routes and markets across the Pacific Rim”.

“This alliance is the third strategic revenue sharing alliance we have formed in recent years, following agreements with Virgin Australia (reauthorised in 2013) and Cathay Pacific in 2012. Forming alliances with the right partners in the right markets is a key pillar of our Go Beyond strategy,” he said.

With Qantas and Virgin both posting losses, what do you think Air NZ are doing right?