Air New Zealand Limited · NZX:AIR
Air New Zealand — FY2006 Earnings Presentation
20 slides from Air New Zealand's earnings presentation, Aug 25, 2006
Slide 1: 2006 Annual Results
oF CONMNGES 2006 ANNUAL RESULTS i, a
Slide 2: Operating revenue $3,616m
Operating revenue $3, 616m PBUT gi6om | > $285m “885m. “36% NPAT $96m- $180m f° “$84 “47% Operating cash flow $473m $437 m +$36m +B% Gash $1,150m $1,070 $80m 7 Ge Gearing 54.7% BAO : “10.7 pts Annual dividend S cps
Slide 3: Profit bridge
$500m OS $480m $350m $300m, » $260m $160m $100m $500 a $400m “$200. PR EDL T YW a Wage ‘Yield increase... $15Om .°$(24)m © Fuel : y $ : My 86 12)m ces Nolume $(87)m ° . : Price increase en SOT Sy, Caste. . Savings Other... $106m 2 $C)m Fleet Induction . $(50)m
Slide 4: Strategic directions
GEEARGSIR AnEGICIDIRECHONS Bengtion every route we generating lop puarile mar
Slide 5: More satisfied customers
14 points 22 points 13 points 20 points 42 c= 2 = - 6 & & yy ut © £ a E ‘Ss = 6 = o Business Class Economy Class MORE SATISFIED CUSTOMERS
Slide 6: Emerging portfolio of routes
ORTFOLI EMERGING PORTFOLIO OF ROUTES CORE ROUTES: AN NURTURE AND GROW ®NZ-US NZ-UK NZ-JPN NZ-CHN NZ-AUS NZ-PI DOMESTIC e@¢ 6 © @ @ NEW ROUTES BEING EVALUATED RE-EVALUATE ® AWAITING DECISION ON TASMAN CODESHARE * MID-PACIFIC FLYING UNDER REVIEW EXIT: * AKL-NGO * AKL-TPE @ AKL-SIN @ CHC-LAX
Slide 7: Online revenue up 43%
$300m Online revenue up 43% $900m - $800m - $700m . $600m _ $500m - $400m . $200m $100m 11,600 _ 11,000 _. 10,500 70,000 _ 9,500 9,000 — 8,500 TWO KEY AREAS OF FOCUS - ONLINE AND WORLD CLASS COMPETITIVENESS Employee Numbers down 6% over last year : 16,233 2003 2004 2008
Slide 8: Route performance
ma i NZ-Australla NZ-UK 30% NZ-USA 60% NZ-Pacific Islands 50% N2-Japan 75% NZ-China 30% NZ-Hong Kong. 40% Domestic
Slide 9: NZ income statement items
NZ Ir Jet aircraft residual value hedge = Financial instruments * Defined benefit plans . -@ “Taxation 7 ; Maintenance —
Slide 10: Fuel prices will heavily influence profitability in 2007
-Fuel prices will heavily influence level of profitability in 2007 Good level of coverin place against macro inputs: 60% of crude oil hedged at US$71 per barrel - ~ 91% of net FX exposure hedged at 68 cents - . “At today’s fuel prices the cost of fuel will increase by around $350 million —
Slide 11: 2006 Financial Results | 2007 Outlook
2006 FINANCIAL. RESULTS | 2007 OUTLOOK ® -PBUTS150m <0 “|e Fuel prices will heavily influence © NPAT $96m - ee profitability in 2007. ~ *. Operating cash flow $473m° | & Look to maintain stable dividends Final dividend.2.5 cps a
Slide 12: ay Pa
Ht nh oe ay Pa _ me
Slide 13: Operating revenue
; Operating revenue EBITDRA $689rn $697m “$8 21% EBIT $148m goon “B64 30% PBUT. $150 $235m “$85: “36% * Unusuals - ($44m) Gam) f gat NA MPAT $06m $1 80m “$8am" “47% Annual dividend
Slide 14: Operating cash flow
Operating cash flow $473m $437m 4$36m Investing ‘cash How ($772m) : ($532m} : ~$240m com 45% Financing cash flow $379m $t45m $$2S4m + 161% Net increase in-cash $80m $50 : +$380m +60% Cash $1,150m $1,070m 4$80m 47%
Slide 15: Gearing
FUN: 80% — 70% | 60% 2 4 BO%_| 40% | 80% —_| 90% | “10%. 0% 72% 53% . : a 55% BAG "20020 BOOB BOOS 2008 © 2008 + Including net capitalised airgraft operating leases. RRS
Slide 16: Yield movement
JUL-O5 AUG 05 “OCT 05 NOV OS Yield Movement 19 on a) a fa UAN 08 MAR 06 JUN 66 “APR 06 AIR NEW: ZEALAND 3"
Slide 17: Passengers
i Mii Passengers ASKS 34,055m : 33,692m +363m . +1% RPKs 25,55im 25,568m : 17m a0) Load Factor 75% 76% ~ ~tpts ~~ ¥ield (cents per RPK)
Slide 18: Passengers
Passengers ASKs RPKs Load Factor
Slide 19: Passengers
Passengers ASKs RPKs- Load Factor
Slide 20: Fleet
| AL FLEET 7AP-A00 777-200ER 5 5 3 8 767-900ER 9 (2) a on 6 320-200 10 4° @): 12 +9 737-300 17 @) 14 +4 ATRI2- 19 Q) it +4 Saab 340A 17 @> 13 @) 4 a300- 8 8 8 16 Beech 1900D 16 16 16 Total operating fleet