AIR-Air New Zealand Limited

[Teitei]

On the basis of the updates above, and assuming an average jet fuel price for the remainder of the 2023 financial year of US$95 per barrel, the airline now expects earnings before other significant items and taxation for the 2023 financial year to be in the range of $510 million to $560 million. This compares with the prior guidance range of $450 million to $530 million.


Ooo look an upgrade - next announcement should be all about a dividend this year

Against a current market cap of $2.6 billion, the mid point forecast of $535m NPBT (will be no tax for a few years given the losses sustained in the last 3 years of the pandemic) puts the stock on a PER of 4.85X or 6.75X after notional tax of 28%.

Looks cheap.

Talked to a friend who is a senior steward at Air NZ recently - they are still looking for staff but the worse is over.  Interesting but I did not know that one has to be able to swim to be a flight attendant! And on every flight, there is a staff member with self-defense skills.

[Waltzing]

yes lift off... get some...
 
anyone gone europe recently? who did you fly with?

[Onemootpoint]

yes lift off... get some...
 
anyone gone europe recently? who did you fly with?

A friend (returned last week).
Flew EK though.
Business trip from CHC. Company paid.

[Basil]

On the basis of the updates above, and assuming an average jet fuel price for the remainder of the 2023 financial year of US$95 per barrel, the airline now expects earnings before other significant items and taxation for the 2023 financial year to be in the range of $510 million to $560 million. This compares with the prior guidance range of $450 million to $530 million.
Ooo look an upgrade - next announcement should be all about a dividend this year

No doubt about it they're absolutely taking customers to the cleaners with their new super expensive price structure. How long will it last though ? 
Lot of new capacity being put on the N.Z. route by AIR's competitors.

What have we got here ? A one year revenge travel / price gouging phenomenon or an enduring new trend...that's the $64,000 question. You'd have to be crackers to think you can be sure of the answer, sorry mate, couldn't resist

Maybe we should think about what the TA is telling us.  Clear break down through the 100 day MA...not looking that flash.  I think the market is telling us that as usual we can expect other carriers to put a LOT more capacity on routes AIR flies such that the super premium pricing AIR has enjoyed in the last year won't last.

[Waltzing]

would agree but there is a world wide shortage of planes, crews an tink that might give the KIWI a break.

its worth having a bit of it..

https://www.flightglobal.com/airlines/aircraft-shortage-emerging-amid-endemic-delivery-delays/151711.article

https://www.flightglobal.com/airlines/strong-demand-cheaper-fuel-prompt-air-nz-to-up-profit-guidance/153028.article

its wobbling around a bit...

[Onemootpoint]

A couple of months old but an opinion that there are too many passengers (demand) but not enough planes to fly them.

It also refers to the upcoming competition on the North American routes.

The big problem at Air NZ few people are talking about

https://www.stuff.co.nz/travel/news/300819240/the-big-problem-at-air-nz-few-people-are-talking-about

[Waltzing]

Yeep  ..  anyone like the 777-200ER ?

seemed to be a loud air con every time... dont ever want to be on a night flight in one of those old beasts.

Air wont be returning to its SP highs for sure but its still could see SP slow growth off 60-70 range.

And plenty of shaz will buy it and may be since they dont know a debit from a credit and a balance sheet from a bowel movement  they will move the price anyway... if the SHAZ platform doesnt not go broke..

[Shareguy]

A couple of months old but an opinion that there are too many passengers (demand) but not enough planes to fly them.

It also refers to the upcoming competition on the North American routes.

The big problem at Air NZ few people are talking about

https://www.stuff.co.nz/travel/news/300819240/the-big-problem-at-air-nz-few-people-are-talking-about

Good article. Also there is a lot of people who were treated poorly during COVID. Air NZ were deceitful with US refunds and broke the law.  Once the credits are used up a lot of built up loyalty will be gone in my opinion.  Will the pend up demand from the the last few years continue.  How much business will be lost due to lack of planes and others taking the routes.  What affect will these new entrants have longer term.

I don't see it as cheap, fairly priced in my opinion. 

Disc, Not a holder.

[Crackity]

Good article. Also there is a lot of people who were treated poorly during COVID. Air NZ were deceitful with US refunds and broke the law.  Once the credits are used up a lot of built up loyalty will be gone in my opinion.  Will the pend up demand from the the last few years continue.  How much business will be lost due to lack of planes and others taking the routes.  What affect will these new entrants have longer term.

I don't see it as cheap, fairly priced in my opinion. 

Disc, Not a holder.

Recommendation impact (last updated: 27/04/2023)

--

Event analysis

Air New Zealand: Cheap Fuel and Full Planes a Boon for Near-Term Profitability

We maintain our NZD 0.97 fair value estimate for shares in Air New Zealand following a trading update. Our fair value estimate for Australian-listed securities lifts 2% to AUD 0.90 based on the current AUD/NZD exchange rate of about 1.08. The airline upgraded guidance for fiscal 2023 underlying pretax profit to between NZD 510 million and NZD 560 million—a 9% increase from prior guidance at the midpoint. Strong demand is persisting, and jet fuel prices have moderated (albeit offset by weakness in the NZD), leading to exceptional near-term profitability for Air New Zealand. We lift our fiscal 2023 underlying pretax profit forecast by 5% to NZD 542 million, but make only minor tweaks to our longer-term forecasts.


It's an update from Morningside so almost certainly incorrect......

[Onemootpoint]

Haha, true.
In some cases M seem to be ultra conservative, but not here.

All things being equal so to speak, I do seem some upwards potential though.

[Waltzing]

one of the best performing stocks lately has been FLT Centre ...

did a raise at 14.60 and SP just hit 20 again...
 
A retired Fire man from Matamata visited Lake Karapiro yesterday and said he flying first class to Holland to visit 2 of his children living and work there....

Now this might not sound strange only neither he nor his wife are Dutch. 

He knew not what time his plan departed singapore nor landed nor what air port hes was landing and not that in September in the northern hemisphere it was going to be autumn nor that his wife was planning on taking him to the

https://www.mauritshuis.nl/?_gl=1*1xylxhn*_ga*MTQ3MTc0NDYwNy4xNjgzMDY3MTkx*_ga_RX3Z9MNYR9*MTY4MzA2NzE5MC4xLjAuMTY4MzA2NzE5MC4wLjAuMA..

There you go KIWIS your International....  Hes going to get Colosnee for sure. His wife knew exactly what was in the Art House.

Could it be that the country is actually run by women who know their Art while the KIWI man inhabits his Cave in the Garage.

This retired fire fighters world is about the change through the invention of powered flight.

The sky's are about to get full again....

Colosnee Explained.

(This is a condition you may suffer from if your visit or revisit europe or the UK). the worst cases are often reported after peoples from down under go to a summer evenings performance of Mid Summer Nights Dream anywhere in the northern hemisphere. Once back down under the infected individual slowly recovers from this condition only to find that their children if sent on their OE stay to long in Europe that they too get Colosnee...ed).

(Colosnee ... Colonised....)

https://www.youtube.com/watch?v=KTFEZiKItLs

 

[Basil]

Watched a youtube video on Emirates first class suites on their A380 with the showers and everything the other day.  Og my goodness...that's the way to travel.  https://www.youtube.com/watch?v=F6hpzfYV2fU
AIR so called premium product so outdated it's pathetic.  That's how I see it.

[Onemootpoint]

That is a nice way to fly, although the older I get the less I enjoy it. Knock me out when we pull away from the gate and wake me up once we're back on the ground.

Remember Mr T?   

[Basil]

That is a nice way to fly, although the older I get the less I enjoy it. Knock me out when we pull away from the gate and wake me up once we're back on the ground.

Remember Mr T?   

Yeap.  I think that's what most people try and do with the free alcohol and coffee, maybe aided and abetted by the sleeping pills they bring along lol
Only issue I have is that very fat dogs and extremely small economy seats or the standard economy seats AIR tries to pass off as business class, don't go together and are not happy bedfellows. 

[Basil]

Good article. Also there is a lot of people who were treated poorly during COVID. Air NZ were deceitful with US refunds and broke the law.  Once the credits are used up a lot of built up loyalty will be gone in my opinion.  Will the pend up demand from the the last few years continue.  How much business will be lost due to lack of planes and others taking the routes.  What affect will these new entrants have longer term.

I don't see it as cheap, fairly priced in my opinion. 

Disc, Not a holder.

Excellent synopsis.  The air fare wars have started already, a bit earlier than I anticipated.
Lot of capacity being brough back by overseas carriers with more modern aircraft and far more comfortable interior configurations.  AIR product is dated and as you say they are short of planes and crew.
https://www.airnewzealand.co.nz/?ef_id=87d7d313a44c1b4213e2b74ba33a1ad6:G:s&s_kwcid=AL!1735!10!77309586518899!77309604386697&msclkid=87d7d313a44c1b4213e2b74ba33a1ad6&utm_source=bing&utm_medium=cpc&utm_campaign=BING%20AIRNZ%20NZ%20%7C%20Brand%20%7C%20-%20%7C%20-%20%7C%20-%20%7C%20EXA%20%7C%20Tail%20Terms&utm_term=air%20new%20zealan&utm_content=Misspellings
Grab a seat cheap internal flights are back too.  Might be flying to Dunedin later this month, only $104 each way from Auckland.
The brief era of AIR being able to price gouge customers is already over.  As you suggest, once those credits are used up people will reflect on how poorly AIR treated them during the pandemic and have their eyes wide open to make an objective decision about which carrier will give them the best flight experience for their hard earned money.