* Expects pre-tax underlying loss of up to $315 mln in FY21
* Similar financial result expected in FY22
* Delays start of delivery of Boeing 787s to FY24 from FY23
June 18 (Reuters) - Air New Zealand said on Friday
it expects losses in fiscal 2021 and 2022 as any meaningful
recovery in long-haul demand was unlikely while international
borders remain closed, though domestic capacity is back to 90%
of pre-pandemic levels.
The airline said losses before other significant items and
taxation would not exceed NZ$450 million ($315 million) for
financial year 2021 ending on June 30. The company said it
expected a similar result in 2022, but that forecast was more
Long-haul international passenger travel remains highly
restricted with passenger volumes currently less than 5% of
pre-COVID-19 levels, while international borders remain closed,
Air NZ said, although capacity to Australia is back to 70% of
normal levels due to a quarantine-free travel bubble.
Air NZ Chief Executive Greg Foran said the airline's biggest
focus was on maintaining cost reductions across its business
made since the start of the pandemic as well as finding
As a result, it has pushed back the delivery of the first of
eight Boeing Co 787s by a year to fiscal 2024 due to the
weaker outlook for long-haul travel than forecast when it placed
the order in 2019.
It can also defer deliveries on other 787s due from fiscal
2024 onward if needed, the airline said.
Air NZ said domestic capacity was now at about 90% of
pre-pandemic levels, and corporate demand continues to show
strong signs of recovery, while its cargo business was also
These segments, along with government support measures, have
helped the company generate positive core earnings since
September 2020, making it cash flow positive since the second
quarter of the 2021 financial year, it said.
Air NZ said it had drawn down NZ$350 million of a NZ$1.5
billion government loan, while plans for an equity raising by
Sept. 30 to improve its capital structure remained unchanged.
($1 = 1.4282 New Zealand dollars)
(Reporting by Rashmi Ashok in Bengaluru and Jamie Freed in
Sydney; editing by Vinay Dwivedi and Richard Pullin)