Air NZ profit falls sharply

AIR New Zealand has seen a 79 per cent drop in profit for the first two quarters ending 31 December. Profit fell to NZ$24 million (US$12 million), compared with NZ$115 million ($57.8 million) a year ago.

Chairman John Palmer said that the fall was due to high fuel costs last year but he predicted that the last two quarters would see a considerable improvement.

“I am confident that Air New Zealand is in a strong position to weather the current economic climate,” he said.

The carrier has saved NZ$20 million by cutting 200 jobs, cut capacity on numerous routes and stopped some routes altogether.

However, it is one of the airlines that is currently being prosecuted by New Zealand’s competition regulator for price fixing of airfreight fuel surcharges. It is also seeing increased competition from Qantas and Virgin Blue.

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