Air New Zealand Limited · NZX:AIR
Air New Zealand — Non-Deal Roadshow (June 2008)
9 slides from Air New Zealand's roadshow presentation, Jun 12, 2008
Slide 1: Air New Zealand UK/US Roadshow - June 2008
For personal use only Air New Zealand UK/US Roadshow - June 2008 Rob Fyfe, CEO
Slide 2: Recent Performance
Recent Performance For personal use only $m NZ 350 300 Net Profit Before Tax 250 200 150 100 50 0 FY01 FY02 FY03 FY04 FY05 FY06 FY07* 2007 Calendar *Normalised earnings, in accordance with NZ IFRS, before taxation and unusual items after excluding net gains/losses on non-hedge accounted and ineffect
Slide 3: Strong Position
Strong Position For personal use only • Fast and flexible • Strong network position • World class product • Strong balance sheet position • Low capital commitments • Relatively young fuel efficient fleet
Slide 4: Challenging Times
Challenging Times For personal use only • Record jet fuel prices • Record capacity • US economy slowing • Other economies also softening • Inflation risk in developed world • Increase in commodity prices
Slide 5: Jet Fuel price chart
For personal use only USD per barrel Ju n- 0 20 40 60 80 100 120 140 160 180 200 03 O ct -0 Fe 3 b- 0 Jet Fuel Ju 4 n- 04 O ct -0 Fe 4 b- 0 Ju 5 n- 05 O ct -0 Fe 5 b- 0 Ju 6 n- 06 O ct -0 Fe 6 b- 0 Ju 7 n- 07 O ct -0 Fe 7 b- 0 Ju 8 n- 08
Slide 6: Affect on Airline Industry
Affect on Airline Industry For personal use only • IATA cut its industry forecast for the fourth time in nine months • US$7.8billion profit to a US$2.3billion loss • 24 carriers have failed in the past six months • Bloomberg’s global airline index down over 33% since January • Air New Zealand’s earn
Slide 7: Jet Fuel Price Scenarios
Jet Fuel Price Scenarios For personal use only US$100 US$150 US$200 - Industry still - Many carriers just - Balance sheet operating hanging on strength comes into profitability - Returns to play - Proliferation of low shareholders - Network strength key cost carriers unacceptable - Surplus capacity
Slide 8: Current Reaction
Current Reaction For personal use only • Across the board price increases • Capacity rationalisation –Initial frequency cuts and down gauging • Focus on fuel efficient fleet
Slide 9: New Operating Environment
New Operating Environment For personal use only • Airlines will rationalise routes at the periphery of their network • Airlines will conserve cash and fight to protect core markets • In Air New Zealand’s markets this could lead to; – Capacity rationalisation in the domestic market by the smaller pla