Air New Zealand Investor Update

(PR.co.nz)

JULY MARKET CONDITIONS

Air New Zealand carried 1,155,000 passengers during the month of July, 7.2%* greater than last year. Revenue passenger kilometres (RPKs) were up 6.8%* and capacity (ASKs) was increased by 1.7%*. The Group load factor increased by 4.0 percentage points.

Short Haul passenger numbers were up 7.6%* on July last year. Demand (RPKs) increased in the Domestic market by 8.5%* on last year and the load factor rose by 3.5 percentage points to 79.8% on a capacity increase of 3.7%*. Tasman / Pacific demand was 7.8%* higher after capacity was increased by 0.7%*. The Tasman / Pacific load factor increased 5.6 percentage points on July 2009 to 84.5%.

Long Haul passenger numbers were 5.2%* higher than July last year. North America / UK routes saw comparable demand to last July, with a load factor increase of 2.6 percentage points to 87.1%. Capacity was reduced by 2.7%* primarily from down gauging aircraft on the Vancouver route. Demand increased by 15.4%* on Asia / Japan / UK routes and capacity was increased by 8.4%*, load factor rose by 4.9 percentage points to 82.0%. In July last year Air New Zealand reduced capacity in response to decreased demand as a result of swine flu that predominantly impacted Asian markets.

Group-wide yields for the first month of the 2011 financial year were up 5.0% on the same period last year. Compared to last July, Short Haul yields were down 0.2%, as the airline introduced lower fares which stimulated demand, and the respective Long Haul yields were up by 11.6%. Removing the impact of foreign exchange, Group-wide yields were up 9.6%.
The winter conditions again caused a number of operational challenges, resulting in 84.6% of Air New Zealand’s Domestic flights departing within 10 minutes of schedule departure time in July.

– Month on month percentage movements have been adjusted on a daily weighted average basis. The adjustment takes into account the difference in days for the July 2010 accounting period (32 days) compared with July 2009 (33 days).

COMPANY NEWS

– 2010 Annual Results Announcement Date

Air New Zealand will announce its Annual Results for the 2010 financial year on Thursday 26 August.

A webcast of the investor presentation will be available for view from 11am at: www.airnewzealand.co.nz/investor-centre.

– Starfish discount card for regional travellers

Air New Zealand has announced further commitment to regional New Zealand by offering discount options which will appeal to frequent regional travellers and stimulate demand for regional travel.

During a two month trial sale period, travellers can purchase from two “Starfish card” discount options. The first costing $200 for an annual 15% discount or $800 for an annual 30% discount. The discounts apply to all regional airfares purchased online.

Media Release on 19 August 2010 from Air New Zealand to investors.