Air New Zealand Limited · NZX:AIR
Air New Zealand — Deutsche Bank Depositary Receipts Virtual Investor Conference (March 2018)
22 slides from Air New Zealand's conference presentation, Mar 21, 2018
Slide 1: Investor Presentation: Deutsche Bank Depositary Receipts Virtual Investor Conference
For personal use only Investor ____ AIR NEW ZEALAND Xo~ Presentation Deutsche Bank Depositary Receipts Virtual Investor Conference Leila Peters Head of Investor Relations - 7+. 21 March, 2018 A STAR ALLIANCE MEMBER %2"
Slide 2: Forward looking statements
Forward looking statements For personal use only This presentation contains forward-looking statements. Forward-looking statements often include words such as “anticipate", "expect", "intend", "plan", "believe“ , “continue” or similar words in connection with discussions of future operating or finan
Slide 3: Air New Zealand at a glance
Air New Zealand at a glance 77 Pacific Rim For personal use only Years in operation Focused network driven by alliance relationships 16m 11,800 Passengers carried Air New Zealand employees annually 30 21 International Domestic destinations destinations #1 #1 Corporate reputation Corporate reputation
Slide 4: Trading and ownership facts
Trading and ownership facts For personal use only AIR AIZ ANZLY Share register NXZ stock ticker ASX stock ticker* ADR ticker on OTC (as at 31 December 2017) Retail • Dual-listed on the NZX and ASX stock exchanges investors 3% • 1.4 million average daily trading volume • Member of the NZX20 index – i
Slide 5: Strategic focus and competitive advantage is the New Zealand market and the Pacific Rim
Our strategic focus and competitive advantage is the New Zealand market, and connecting New Zealand with the Pacific Rim For personal use only 2012 2017 Routes operated by Air New Zealand Routes operated solely by alliance partners 5 Services to Taipei commencing November 2018
Slide 6: Markets experiencing robust demand drivers
Air New Zealand’s markets are experiencing robust demand drivers that are expected to remain strong for the foreseeable future For personal use only Inbound New Zealand tourism continues to grow strongly Growing domestic tourism Double-digit growth in New Zealanders traveling abroad Robust N
Slide 7: Inbound and outbound tourism demand remains robust
Inbound and outbound tourism demand remains robust For personal use only Inbound visitors to New Zealand* Inbound visitor arrivals by country* (in millions and % growth from prior year) 3.6M Other markets 3.3M Australia 3.0M 33% 2.6M 2.8M 40% ‘flat’ +5.7% +7.4% +10.6% +10.2% growth UK 7% China USA 2
Slide 8: Profitability and dividends through the cycle
Air New Zealand has Net profit after tax achieved profitability ($ millions) 463 For personal use only and dividends 327 382 through the cycle… 221 218 263 166 166 180 181 96 82 81 71 21 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Dividends declared 15 years of consecu
Slide 9: Strong shareholder returns that exceed the major indices
…and have demonstrated our ability to generate strong shareholder returns that exceed the major indices For personal use only Total shareholder return* Air New Zealand 468% NZX50 ASX200 116% 89% Bloomberg World Airlines Index S&P500 1 year 5 year 10 year * Total shareholder return includes share pri
Slide 10: Sustainability agenda with robust targets to reduce carbon footprint
Beyond commercial metrics, we are committed to a sustainability agenda that includes robust targets to reduce our carbon footprint For personal use only Investment in modern fleet have helped improve our fuel efficiency while we have grown our business Key carbon targets* Fuel efficiency: 2.5% CO2-e
Slide 11: Positioned to leverage unique competitive advantages
Resilient core domestic business For personal use only Positioned to leverage our unique competitive advantages to drive future returns for our Pacific Rim focused international network shareholders Focused on sustainable cost improvements Investment grade financial strength 11
Slide 12: Resilient core domestic business
1 Resilient core domestic business Strong market share to leverage growth from inbound and domestic tourism For personal use only • Most iconic brand in New Zealand • Unmatched network breadth and depth − Over 400 flights daily to 21 domestic destinations • Differentiated in-flight and ground produc
Slide 13: Pacific Rim focused international network
2 Pacific Rim focused international network Supported by strong revenue share alliance partnerships For personal use only Why revenue share alliances? Partners have “skin in the game” to sell the route Strength of sales & distribution in local markets Access to frequent flyer databases Routes
Slide 14: Focused on sustainable cost improvements
3 Focused on sustainable cost improvements A simpler and modern fleet driving improved efficiencies For personal use only Fleet investment over the past five years has resulted in cost improvements related to fuel efficiency, larger aircraft and simplification of operations 2012 2017 Many fleet type
Slide 15: Investment grade financial strength: aircraft capex programme
4 Investment grade financial strength Aircraft capex programme nearing completion use only Actual and forecast aircraft capital expenditure2 1,000 ~$1.1b1 Forecasted 3 Forecast investment in aircraft 800 and associated assets from 2H 2018 Actual $ millions For personal to 2021 600 2H 400 200 1H 0 20
Slide 16: Investment grade financial strength: credit rating and gearing
4 Investment grade financial strength Providing stability and financial flexibility over the long-term For personal use only Moody’s credit rating Appropriate level of gearing A3 Gearing (%) (including capitalised aircraft operating leases) Investment grade Baa1 Target range of 45% to 55% 52.4% 51.8
Slide 17: Positioned to deliver strong dividends
A sustainable business positioned to deliver strong dividends for our shareholders For personal use only • We target consistently distributing dividends to Ordinary dividends paid (cents per share) our shareholders each period 20.0 21.0 16.0 • Dividend is not linked to a pay-out ratio 10.0 8.0 8.5 8
Slide 18: 2018 outlook reaffirmed despite jet fuel price increase
Our 2018 outlook* has been reaffirmed despite an increase in jet fuel price For personal use only Looking to the remainder of the year, we are optimistic about the overall market dynamics. Based upon the current market conditions and despite the increased price of jet fuel, the Company is still expe
Slide 19: Air New Zealand American Depositary Receipts (ADR)
Air New Zealand American Depositary Receipts (ADR) Air New Zealand has a sponsored Level 1 ADR For personal use only programme (since July 2017) Ticker: ANZFY Structure: Level 1 ADR Exchange traded: Over-the-Counter (OTC) Ratio 1 ADR: 5 Ordinary shares DR ISIN: US0091361024 CUSIP: 009136102 Deposita
Slide 20: Investor relations information
20 Investor relations information For personal use only Resources Investor website: www.airnewzealand.co.nz/investor-centre Monthly traffic updates: www.airnewzealand.co.nz/monthly-operating-data Quarterly fuel hedging disclosure: www.airnewzealand.co.nz/fuel-hedging-announcements Corporate governan
Slide 21: For personal use only
For personal use only
Slide 22: For personal use only
For personal use only L2. AIR NEW ZEALAND \o_ A A STAR ALLIANCE MEMBER YS"
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