Air New Zealand Limited · NZX:AIR
Air New Zealand — FY2025 Earnings Presentation
45 slides from Air New Zealand's earnings presentation, Aug 28, 2025
Slide 1: 2025 Annual Results
2025 ANNUAL RESULTS Investor presentation 28 August 2025 NZX: AIR / ASX: AIZ / US OTC: ANZLY A L L I N F O R M A T I O N I S P R I V A T E A N D C O N F I D E N T I A L A I R N E W Z E A L A N D AIR NEW ZEALAND 2024 ANNUAL RESULTS 2 0 2 5 A N N U A L R E S U L T S 1 1
Slide 2: Forward-looking statements and disclaimer
F O R WA R D - L O O K I N G S TAT E M E N T S A N D D I S C L A I M E R This presentation is given on behalf of Air New Zealand Limited (NZX: AIR and looking statements and undue reliance should not be placed on any forward- AIR030; ASX: AIZ). The information in this presentation: looking statement
Slide 3: Agenda
Agenda 2025 Highlights 2025 Financial Performance Strategic Business Update Outlook AIR NEW ZEALAND 2024 5 ANNUAL RESULTS 3 3
Slide 4: 2025 Highlights
2025 Highlights Greg Foran Chief Executive Officer A L L I N F O R M A T I O N I S P R I V A T E A N D C O N F I D E N T I A L A I R N E W Z E A L A N D AIR NEW ZEALAND 2024 ANNUAL RESULTS 2 0 2 5 A N N U A L R E S U L T S 4 4
Slide 5: Key messages
Key messages Focused on steady delivery amidst significant near-term operational complexity Grounded aircraft position expected to improve slowly, with majority returned to service by end of calendar 2027 Strong capacity growth from 2027 onwards driven by new Boeing 787 deliveries and alleviation of
Slide 6: 2025 Year in review – a resilient underlying business
2025 Year in review – a resilient underlying business Network growth temporarily constrained by engine availability $189m earnings ASKs down 4% 1.25 cps unimputed before taxation With up to 11 jet aircraft grounded at final ordinary dividend times due to additional engine Includes $35m of unused tra
Slide 7: Demand strong across international markets
Demand strong across international markets Taking steps to stimulate Domestic market Domestic Short-Haul Long-Haul • Good demand for Auckland, Christchurch and • Strong leisure demand on the Tasman, passenger • Strong Kiwi-outbound demand to Asia - Queenstown jet markets share ahead of capacity Sing
Slide 8: Investments in the customer proposition and our people are generating positive results
Investments in the customer proposition and our people are generating positive results Key customer metrics Win on customer experience improved 2H vs 1H 2025 • First four retrofitted 787 back, three more to come in calendar 2025 • Automated passenger rebooking capability launched on Domestic • New C
Slide 9: Transformation initiatives delivered ~$100 million in EBITDA benefits in 2025
Transformation initiatives delivered ~$100 million in EBITDA benefits in 2025 Benefits in 2025 included: What we said at 2025 Actuals • NextGen revenue management on 2024 Investor Day: Domestic and Tasman/Pacific Islands ~$100m networks, partial benefit on Long-Haul • Direct ancillary buy-ups • Cont
Slide 10: Actively managing aircraft availability from global engine maintenance delays
Actively managing aircraft availability from global engine maintenance delays Up to 11 aircraft grounded out of 60 jet fleet in 2025 Latest actions to mitigate impact 1H 2025 7-8 Narrowbody Two leased Airbus A321neo aircraft (up to 12 Grounded1 year lease) delivered Widebody Investing in four additi
Slide 11: 2025 Financial Performance
2025 Financial Performance Richard Thomson Chief Financial Officer A L L I N F O R M A T I O N I S P R I V A T E A N D C O N F I D E N T I A L A I R N E W Z E A L A N D 2 0 2 5 A N N U A L R E S U L T S 11
Slide 12: Financial summary
Financial summary Earnings/(Loss) Before Taxation • Operating revenue of $6.8 billion, ($ millions) comparable with the prior year • Earnings before taxation of $189 million, Covid-19 impacted down 15% period 574 • Net profit after taxation of $126 million, 222 189 down 14% • Liquidity of $1.7 billi
Slide 13: Impact of engine delays on financial performance has been significant, despite compensation
Impact of engine delays on financial performance has been significant, despite compensation Earnings before taxation adjusted for estimated impact of engine issues ($ millions) ~$165 million1 residual adverse impact to (107) earnings, despite compensation of ~280 $129 million in 2025 to (22) ~340 to
Slide 14: Profitability waterfall
Profitability waterfall Additional commentary • Revenue and other income includes $92 million favourable movement from compensation received • Broad based price inflation of ~6% across the non-fuel cost base, a headwind of $235 million vs the prior year • Waterfall chart includes the benefit of tran
Slide 15: Aviation system inflation has outpaced NZ CPI
Aviation system inflation has outpaced NZ CPI Trend expected to continue Cumulative price inflation across cost base vs NZ CPI Addressing inflation with: (2019 vs 2025) Continued investments in digital systems and tooling to drive cost efficiencies 30% Scaling costs as our network growth returns int
Slide 16: Unit cost increases reflect impact of fleet constraints and price pressure
Unit cost increases reflect impact of fleet constraints and continued price pressure across the aviation ecosystem • Reported CASK increased 4.2%, largely due to reduced capacity, ongoing inflationary pressures and inefficiencies associated with fleet constraints • Excluding the impact of fuel price
Slide 17: Fleet investment update
Fleet investment update • Forecast investment of ~$3.7 billion in Actual and forecast aircraft capital expenditure1 aircraft and associated assets through to 20302 ‒ Options exercised for two additional 787- 1,300 10s, expected delivery in 2028 and 20303 1,200 1,100 ‒ Approximately $210 million lowe
Slide 18: Robust capital management metrics in preparation for increased capex profile
Robust capital management metrics in preparation for increased capex profile PROGRESS MADE IN 2025 Maintain financial resilience and flexibility • Transitioned to new global payments provider, • Target liquidity range of $1.2 billion to $1.5 billion releasing ~$175 million in cash collateral to avai
Slide 19: Strategic Business Update
Strategic Business Update GREG FORAN RICHARD THOMSON CHIEF EXECUTIVE OFFICER CHIEF FINANCIAL OFFICER A L L I N F O R M A T I O N I S P R I V A T E A N D C O N F I D E N T I A L A I R N E W Z E A L A N D AIR NEW ZEALAND 2024 ANNUAL RESULTS 2 0 2 5 A N N U A L R E S U L T S 19 19
Slide 20: Current estimates of aircraft return point to a slower rate than anticipated
Current estimates of aircraft return point to a slower rate than anticipated 9 to 12 months ago Illustrative internal estimates for available fleet impacted by engine issues Available domestic jet fleet profile Available widebody fleet profile Available Airbus A320/321ceos/neos1 Available Boeing 787
Slide 21: Return to network scale now estimated by 2028
Return to network scale now estimated by 2028, largely due to widebody availability Domestic estimated to grow at a CAGR International estimated to grow at a CAGR of of ~1% to 2%1 ~3% to 4%2 Domestic capacity growth Current assumption International capacity growth Current assumption (Billion ASKs) P
Slide 22: Pace of unit cost improvement impacted by slower return of our most efficient fleet
Pace of unit cost improvement impacted by slower return of our most efficient fleet Certain unit cost headwinds are temporary and improvement …while other costs will be longer lasting will occur gradually as engine issues alleviate… Aviation system inflation Temporary operational resiliency • Constr
Slide 23: Transformation benefits play a critical role
Transformation benefits play a critical role With initiatives on track to deliver cumulative $300 to $400 million benefit to EBITDA performance by 2028 $300m to $400m Commercial & Network Ancillary & Loyalty Cost efficiencies Transformation benefits will shift from helping offset cost inflation in 2
Slide 24: Robust liquidity and prudent capital management framework
Robust liquidity and prudent capital management framework provide resiliency through this period Liquidity at upper Significant debt headroom Additional resilience and bounds of $1.2 billion to leading into increased optionality with ~$1.8 billion $1.5 billion target capex period unencumbered fleet
Slide 25: Outlook
Outlook Greg Foran Chief Executive Officer A L L I N F O R M A T I O N I S P R I V A T E A N D C O N F I D E N T I A L A I R N E W Z E A L A N D 2 0 2 5 A N N U A L R E S U L T S 25
Slide 26: 2026 capacity growth reflects cumulative impact of actions taken
2026 capacity growth reflects cumulative impact of actions taken to mitigate engine availability constraints 2026 2025 ASKs 1H 2026 2H 2026 Sector Estimated Commentary (billions) (vs 1H 2025) (vs 2H 2025) Capacity1 • Assumes one A321neo returns to Domestic 6,409 2% to 3% 3% to 5% 3% to 4% service wi
Slide 27: 2026 considerations
2026 considerations Business factors Financial factors • New compensation agreements currently under • Covid related customer travel credits will expire 31 Jan negotiation with Rolls-Royce and Pratt & Whitney 2026; potential additional breakage for 1H 2026 • Premium cabin demand strength expected to
Slide 28: 2026 outlook
2026 outlook The outcome and timing of compensation discussions with engine manufacturers remains uncertain, making it challenging for the airline to provide earnings guidance for the full year. In the near-term, that uncertainty, combined with sharp recent increases in aviation sector levies and ot
Slide 29: Air New Zealand 2025 Annual Results
AIR NEW ZEALAND 2025 ANNUAL RESULTS 29
Slide 30: Supplementary Information
Supplementary Information A L L I N F O R M A T I O N I S P R I V A T E A N D C O N F I D E N T I A L A I R N E W Z E A L A N D 2 0 2 5 A N N U A L R E S U L T S 30
Slide 31: Key capital management metrics
Key capital management metrics 30 Jun 2025 30 Jun 2024 Capital management targets1 Gross debt2 (2,838) (2,816) Cash, restricted deposits and net 1,758 2,044 open derivatives2 Net debt2 (1,080) (772) Gross debt/EBITDA 2.9x 2.9x Net Debt to EBITDA ratio Net debt/EBITDA 1.1x 0.8x of 1.5x to 2.5x Return
Slide 32: Financial overview
Financial overview Jun 2025 Jun 2024 Movement Movement $M $M $ % Operating revenue 6,755 6,752 3 NM Earnings before taxation 189 222 (33) (15%) Net profit after taxation 126 146 (20) (14%) Operating cash flow 940 810 130 16% Cash position 1,436 1,279 157 12% Ordinary dividends declared 2.5 cps 3.5 c
Slide 33: Group performance metrics
Group performance metrics Jun 2025 Jun 2024 Movement1 % Passengers carried (‘000s) 15,907 16,460 (3%) Available seat kilometres (ASKs, millions) 40,501 42,067 (4%) Revenue passenger kilometres (RPKs, millions) 33,769 34,285 (2%) Load factor 83.4% 81.5% 1.9 pts Passenger revenue per ASKs as reported
Slide 34: Domestic
Domestic Jun 2025 Jun 2024 Movement1 % Passengers carried (‘000s) 10,142 10,721 (5%) Available seat kilometres (ASKs, millions) 6,409 6,620 (3%) Revenue passenger kilometres (RPKs, millions) 5,311 5,571 (5%) Load factor 82.9% 84.2% (1.3 pts) Passenger revenue per ASKs as reported (RASK, cents) 30.1
Slide 35: Tasman & Pacific Islands
Tasman & Pacific Islands Jun 2025 Jun 2024 Movement1 % Passengers carried (‘000s) 3,840 3,811 1% Available seat kilometres (ASKs, millions) 11,562 11,655 (1%) Revenue passenger kilometres (RPKs, millions) 10,055 9,831 2% Load factor 87.0% 84.3% 2.7 pts Passenger revenue per ASKs as reported (RASK, c
Slide 36: International long-haul
International long-haul Jun 2025 Jun 2024 Movement1 % Passengers carried (‘000s) 1,925 1,928 NM Available seat kilometres (ASKs, millions) 22,530 23,792 (5%) Revenue passenger kilometres (RPKs, millions) 18,403 18,883 (3%) Load factor 81.7% 79.4% 2.3 pts Passenger revenue per ASKs as reported (RASK,
Slide 37: Cargo performance
Cargo performance Cargo revenue • Cargo revenue of $487 million, up 6% on prior ($ millions) year. Key drivers include: 487 − Volume driven by increased load factors in (10) 6 international long-haul services, particularly on 32 459 North American routes despite reduced capacity − Increased capacity
Slide 38: Fuel cost movement
Fuel cost movement $210 million (12%) effective decrease ( in fuel price 1,692 (27) (229) 1,484 29 19 Decrease in jet Jun 2025 hedge fuel price loss of $37m US$105 to vs US$88 per barrel Jun 2024 hedge loss of $18m JUN 2024 VOLUME UNDERLYING PRICE NET HEDGING FX JUN 2025 FUEL COSTS IMPACT MOVEMENTS
Slide 39: Fuel and FX volatility expected to continue – well hedged for 2026
Fuel and FX volatility expected to continue – well hedged for 2026 2026 Fuel cost3 sensitivity Fuel hedging 1 • Currently hedging Brent Crude only; exposed to 1,800 Unhedged Hedged pricing movements in the crack spread 1,700 NZD costs of fuel (millions) 1,600 • Hedged with collar structures, balanci
Slide 40: Debt structure and maturity profile
Debt structure and maturity profile Capital structure as at 30 June 2025 Debt maturity profile • Gross Debt of $2.8 billion comprising: ($ millions) – ~$1.2 billion secured aircraft debt and finance leases1 – ~$950 million operating leases1 – ~$700 million unsecured NZD bond and AUD notes 323 • Cash
Slide 41: Unencumbered aircraft of $1.8 billion
Unencumbered aircraft of $1.8 billion Unencumbered aircraft as at 30 Jun 2025 Aircraft values and capital mix ($ billions2,3) 777-300ER 3x 4.9 4.9 In addition to ~$1.8 billion in unencumbered aircraft, 787-9 1x there is significant equity value within financing structures1. A320/321neo 7x A320ceo 9x
Slide 42: Fleet profile
Fleet profile Expected Delivery Dates Number in Average Age1 Aircraft Engines Fleet (Years) 2026 2027 2028 2029 2030 Core fleet: 7 13.2 777-300ER GE90 Short term leased: 3 13.6 Trent 1000 International (GE engines 787-93 for 2026 14 8.8 2 3 2 2 1 deliveries onward) A321neo PW1100 8 5.5 1 2 (short ha
Slide 43: Glossary of key terms
Glossary of key terms Available Seat Kilometres (ASKs) Number of seats operated multiplied by the distance flown (capacity) Cost/ASK (CASK) Operating expenses divided by the total ASK for the period Earnings before interest, tax, depreciation Operating earnings before depreciation and amortisation,
Slide 44: Find information on Air New Zealand
Find information on Air New Zealand Resources Investor website: www.airnewzealand.co.nz/investor-centre Monthly traffic updates: www.airnewzealand.co.nz/monthly-investor-updates Corporate governance: www.airnewzealand.co.nz/corporate-governance Sustainability: https://www.airnewzealand.co.nz/sustain
Slide 45: Air New Zealand 2024 Annual Results
AIR NEW ZEALAND 2024 ANNUAL RESULTS 45