AIR - Air NZ.

[sb9]

Point taken mikey. Just putting things in perspective in the light of recent developments. Agreed, Air had their own issues in the past.

[Joshuatree]

Unfort timing for Craigs latest research on AIR , out this morn. Buy @$2.65 target $3.30 Forecast net yield 2015 5.7 %...2016 6%

Well done to Craigs for a quick update on AIR.
"Elasticity of demand helps mitigate the impact."
"For every 10% price decline demand lifts 15-20%"
"Forecast domestic yields to decline by 2.5%"

Personally its a win/win form hopefully. I don't give stuff which airline i fly domestically being in the air for an hour max.If the prices drop so i don't feel robbed,dearer than going to aus and back great.

I have bought AIR 20% off its recent high for an est impact of "c4-7% of EBIT" so feel I've got a reasonable margin of safety if these estimates are in the ballpark. Hope its up from here then i would have to reassess ,hold reduce or sell.

[Leftfield]

Jet Star's reputation in NZ isn't helped by stories like this;
http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11467804

[Sideshow Bob]

Here is the list of passenger numbers for regional airports - I would presume Jetstar would pick off the four busiest that they currently don't service - so Dunedin, Nelson, Palmerston North, and Napier.
https://en.wikipedia.org/wiki/List_of_the_busiest_airports_in_New_Zealand

Jetstar currently fly from Dunedin (albeit only to AKL)

[couta1]

KW there may be tens of thousands of investment opportunities but any one of them could face difficulties at short notice given the occurrence of certain Macro events so why not Air a well run company driving increasing profits, besides I mainly stick to supporting NZ companies.

[biker]

And that there is the crux of the problem..........

.............At best its a swing traders play as you ride the up and down cycles, picking off what bits of profit you can while you can.............



Totally agree KW, and that is what the CEO is diligently hoping and trying to mitigate. I think he may be partially successful based on historical norms but not completely. Just too many variables in the Airline business.

Disc. Bought back in yesterday in the high 2.30's

[Zaphod]

And that there is the crux of the problem. The risk/reward ratio is not in investors favour. One would only take on such high risk in return for a very large upside. AIR will never trade at high multiples giving you that big payoff. At best its a swing traders play as you ride the up and down cycles, picking off what bits of profit you can while you can.


AirNZ's peers typically trade with a PE in the range of 9 to 11, and all have inferior fundimentals. I'd be very happy for AirNZ to hit any PE in that range!

[tzbang]

AirNZ's peers typically trade with a PE in the range of 9 to 11, and all have inferior fundimentals. I'd be very happy for AirNZ to hit any PE in that range!

Why is this do you suppose? Seems like AIR is constantly undervalued..

[Zaphod]

That would mean New Plymouth then. I am surprised that New Plymouth is busier than Hamilton - I guess people must just drive from Hamilton to Auckland Airport.

NPL also has much higher PAX numbers than TGA and ROT. Some of this will be due to relative distance, but economic factors (such as the median salary in that region being very high) also play a part.

For airports in NZ domestic traffic to Auckland dominates the passenger statistics, so with HLZ only 1 hour away from AKL driving has always been a viable option. Hamilton now has an hourly bus service direct to Auckland Airport.

[macduffy]

Why is this do you suppose? Seems like AIR is constantly undervalued..

Probably because NZ companies typically trade at lower P/E's than their overseas peers - where such comparisons are valid.

[Beagle]

AirNZ's peers typically trade with a PE in the range of 9 to 11, and all have inferior fundimentals. I'd be very happy for AirNZ to hit any PE in that range!

This KW. 50% upside from here if we move back to a 10 year average for AIR of a PE of 10, superb management and great fully imputed dividends....that and oh yeah, I love planes, buying stocks on super cheap fundamentals and supporting Kiwi companies.

[winner69]

Australian broker 'slashes' AIR forecast

http://www.smh.com.au/business/aviation/air-new-zealand-earnings-to-fall-due-to-qantas-moves-20150621-ghs8zs

Extract Overall, as a result of the trans-Pacific threat and the entry of Jetstar onto regional NZ routes, the broker has slashed its 2016-17 EBIT forecast for Air NZ by 16 per cent, or $NZ90 million, to $NZ464 million.

He really stupid eh, probably calls himself a guru broker as well.mpack of overpaid non productive people I reckon but they keep the merry go round of high fees and all that going round.

[Joshuatree]

Well done to Craigs for a quick update on AIR.

"Elasticity of demand helps mitigate the impact."
"For every 10% price decline demand lifts 15-20%"
"Forecast domestic yields to decline by 2.5%"

[winner69]

Well done to Craigs for a quick update on AIR.

"Elasticity of demand helps mitigate the impact."
"For every 10% price decline demand lifts 15-20%"
"Forecast domestic yields to decline by 2.5%"

Repeating yourself me old mate Joshua

If AIR capacity and load factors are already high doesn't any price decline fall straight through to the bottom line, despite more bums on other airline seats because of this 'price elasticity'

And then there's the other part of the 'elasticity' equation - consumer choice and preference - that can impact outcomes

[Beagle]

I've now had the time to fully review Craigs analysis which is a very high quality bit of work IMHO. They note the record high load factors in 2H FY15 that I've previously eluded too and are 3% better than they were forecasting.
Interestingly Winner, if yield's, load factors, oil and currency stay at current level's the FY16 PE becomes 4.4 !!
They are forecasting some decline in yields and load factors in their model and forecasting FY16 PE at 6.5 which is well short of the long run historical average of 10.
All assumptions seem reasonable to me. They rate it a BUY with a 12 month price target of $3.30.
Opportunity knocks for those with the stomach for not expecting a silky smooth ride.

[sb9]

Well summed up Roger, looks like Mr Market agrees with you....:)

[winner69]

Didn't mo have a theory that the more AIR made the lower the PE went ....something based in cyclical earnings to get that average of 10 over time

[couta1]

Didn't mo have a theory that the more AIR made the lower the PE went ....something based in cyclical earnings to get that average of 10 over time
Where is Mo ? Would be good to get his take on the latest developments, come in Mo are you there?

[Beagle]

Oh I dunno KW...rumour has it, its a great place to buy a cheap car :)

[vin]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11469866

Radar fault grounded all commerial flights.. FYI

[WingingIt]

Any one else fly today during the drama period? I read outage started at 14:30, I had a 1600 flight that eventually left at 1625. First I heard of the delay was at the airport via an announcement.

You think they could push this kind of thing to the Airnz app?

[Joshuatree]

I thought it was very considerate that planes in the air were "allowed to land". hee

[biker]

A pretty garbled explanation from the airline pilots association spokeswoman and the TV3 reporter.
Both seemed to be talking rubbish.

[sb9]

:t_up: for today....quietly.

[Beagle]

Operating stat's for May should be out any day now. Should make for interesting reading. Up until April's stat's, load factors have been at record level's notwithstanding the most recent GDP number being rather disappointing. Load factors don't seem to have been affected much by the slightly cooler economic breeze, in fact quite the opposite. Must be all those cheap airfares if you are canny enough to book ahead eh KW :)

[Poet]

Operating stat's for May should be out any day now. Should make for interesting reading. Up until April's stat's, load factors have been at record level's notwithstanding the most recent GDP number being rather disappointing. Load factors don't seem to have been affected much by the slightly cooler economic breeze, in fact quite the opposite. Must be all those cheap airfares if you are canny enough to book ahead eh KW :)

Well op stats are out now along with forecast profit update for this year of $520 to $530m and an indication that they expect to do better next year

[sb9]

Very impressive numbers in my opinion, not stopping from here I reckon, eh Roger...

[kyanar]

It is. Shame the airfares to pick them up are more expensive than the cost of trucking them down. Looks like we need Jetstar here LOL
A few $49 fares coming up though. Competition kicking in already?

[vin]

A few $49 fares coming up though. Competition kicking in already?

Ha yeah I noticed that too. AIR certainly doesn't muck around. Good to see.

[winner69]

The $520m normalised EBIT seems lower than Rogers expectations?

[sb9]

The $520m normalised EBIT seems lower than Rogers expectations?

Don't think so, Roger can confirm that. All I know is that they've done $216M for the first half, so for full year they're more than doubling, gotta be good.

[winner69]

Don't think so, Roger can confirm that. All I know is that they've done $216M for the first half, so for full year they're more than doubling, gotta be good.

Whatever its a lot of money

No wonder other airlines want a share and coming in to make it harder for AIR

Government should never have sold down should they .... but some of Billa nd Johns mates are happy

[Beagle]

The $520m normalised EBIT seems lower than Rogers expectations?

No, Craigs as I stated the other day did some very high quality research with which I fully concur. They have proved to be pretty much on the money with normalised profit expectation of $544m before tax.
Company range of $520-$530m looks highly satisfactory to me. Should give EPS after tax of circa 34 cps. Craigs have 2016 EPS at 38 cps and the company just confirmed profit growth expectations for 2016.
Load factor down a little in May partly as a result of larger capacity aircraft 787-9's replacing 767's on some Asian routes.

In one week, (commencement of FY16), the company starts using what is ostensibly unhedged cheap fuel...cheap in as much as the barrel of Brent is still circa $64 and the company has good FX cover.

Craigs recently reiterated BUY with a $3.30 price target. I think that a fair call although I'd probably rate it a STRONG BUY. Was a COMPELLING BUY the other day at $2.41 when a few weak holders got their panties in a bunch over some old worn out Q300's that Qantas can't sell. Very pleased indeed to have secured a top-up to my holding at that price.

Normalised operating profit before tax at $525m would represent a 47% increase on 2014's figure of $357m.

SB9 - Quite correct mate, $216m for 1H FY15 and circa $309m for 2H FY15 is an outstanding result and even better the company guided higher for FY16 !!!

An extremely well managed business trading on very undemanding fundamental's that's well positioned to enjoy the boost in tourism that a lower dollar will provide. BUY.

[Beagle]

I see our old mate Ewan Wilson is proposing to reincarnate himself back into the N.Z. aviation scene with a single old turboprop aircraft flying unproven routes targeting students.
The likelihood of success, slim to none, in my opinion.

[winner69]

I see our old mate Ewan Wilson is proposing to reincarnate himself back into the N.Z. aviation scene with a single old turboprop aircraft flying unproven routes targeting students.
The likelihood of success, slim to none, in my opinion.

Queenstown ---->>>> Dunedin ----->>>> Nelson ---->>>>> Hamilton and back in a day seems a nice jaunt

Target obviously not just students

[Beagle]

Queenstown ---->>>> Dunedin ----->>>> Nelson ---->>>>> Hamilton and back in a day seems a nice jaunt

Target obviously not just students

Okay..lets say it includes retired old biddies with nothing better to do plus the odd businessman going AWOL with the company credit card and the occasional tourist that wants to take a slow boat from Queenstown to Nelson :D I don't think Ewan realises that we southerners born and bred, (even though some of us with tough Scottish ancestry now reside in much hated Auckland according to our friend KW), just prefer to drive ourselves from Dunedin to Queenstown. I think its time Ewan got himself a proper job...one that doesn't involve destroying million of dollars of his investors money but I suspect a proper airline simply wouldn't hire him. What's he been doing all these years anyway ?

[Regi]

The guy is a joke. I don't know who would take him seriously in the aviation world [insert misinformed exception].

Maybe he will last more than a year this time, but I would happily bet against that. The first headline that comes up after googling Ewen Wilson is all you need to know about him. In fact, only the first 3 words - "Failed airline entrepreneur".

[Hoop]

I see our old mate Ewan Wilson is proposing to reincarnate himself back into the N.Z. aviation scene with a single old turboprop aircraft flying unproven routes targeting students.
The likelihood of success, slim to none, in my opinion.
The word up our way is that Ewan reckons this time around his airline will keep well out of AirNZ's way. He learn't his lesson with Kiwi Air about competing head on with a giant..His business plan is to not compete with AirNZ therefore AirNZ won't see his airline as a threat and destroy his airlines profit margins...Theory has it that this strategy may work Roger as with any small new entrant the most successful way into a pond dominated by one very big fish and a couple of medium size chappies is to find a small dark comfy niche and keep well out of sight..

[winner69]

The guy is a joke. I don't know who would take him seriously in the aviation world [insert misinformed exception].

Maybe he will last more than a year this time, but I would happily bet against that. The first headline that comes up after googling Ewen Wilson is all you need to know about him. In fact, only the first 3 words - "Failed airline entrepreneur".

While you at at it you may as add convicted fraudster

[TheHunter]

Should give EPS after tax of circa 34 cps.

So a current P/E of just under 8... enough said.

[Beagle]

The word up our way is that Ewan reckons this time around his airline will keep well out of AirNZ's way. He learn't his lesson with Kiwi Air about competing head on with a giant..His business plan is to not compete with AirNZ therefore AirNZ won't see his airline as a threat and destroy his airlines profit margins...Theory has it that this strategy may work Roger as with any small new entrant the most successful way into a pond dominated by one very big fish and a couple of medium size chappies is to find a small dark comfy niche and keep well out of sight.. You mean just like a large Rat does :D


So a current P/E of just under 8... enough said.
Not quite. Interesting that Craigs are the most optimistic, I'd say realistic about AIR with their value $3.30 but notwithstanding picking circa 38 cents EPS for FY16 are forecasting that as the peak, like many other brokers with EPS tailing off to 26 cps in FY17. Quite how brokers think they can pick such a dramatic tailing off in earnings in FY17 remains a mystery to me. What if they're wrong and growth just keeps on coming :) (Sits and waits for another explanation from Mod regarding peak PE's relative to normal year PE...perhaps some explanation of how they're so psychic with picking the peak of the earnings cycle so far out would be useful :)). I reckon all this peak of the cycle is nonsense. Economy is hardly firing off like a rock star is it !!

We have EPS this year of circa 34 cents and that's on most of the year paying quite a lot for fuel and we have a 10 year normal PE of 10, (you could argue to use 11-12 seeing as all PE's are super stretched because of ultra low interest rates which will remain so for the foreseeable future. Apply a PE of 11 to 34 cents and you get fair value of $3.74. Simple. Its too far out to reliably predict FY17 results in this industry so all brokers estimates are just guesses as far as I'm concerned. Fair value to me is $3.50-$3.75.

[Zaphod]

A little more competition for AirNZ from Jetstar - Qantas Points are now may be earned on Jetstar flights.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11470927

[Zaphod]

The word up our way is that Ewan reckons this time around his airline will keep well out of AirNZ's way. He learn't his lesson with Kiwi Air about competing head on with a giant..His business plan is to not compete with AirNZ therefore AirNZ won't see his airline as a threat and destroy his airlines profit margins...Theory has it that this strategy may work Roger as with any small new entrant the most successful way into a pond dominated by one very big fish and a couple of medium size chappies is to find a small dark comfy niche and keep well out of sight..

I am left wondering what is the market for HLZ - NSN flights? HLZ ranks 10th in NZ in terms of passenger numbers, some 50,000 passengers per annum behind NPL. HLZ has not experienced any passenger growth for some time, while most other have seen significant growth.

KRA also only have a single Saab 340. A foggy HLZ morning will see flights cancelled or delayed throughout their network, which will hardly be an auspicious start for them. Additionally, they face a VERY tight schedule due to flight timing restrictions in ZQN.

Flying unproven third tier roots won't have a material impact on either AirNZ or Jetstar.

[Beagle]

I am left wondering what is the market for HLZ - NSN flights? HLZ ranks 10th in NZ in terms of passenger numbers, some 50,000 passengers per annum behind NPL. HLZ has not experienced any passenger growth for some time, while most other have seen significant growth.

KRA also only have a single Saab 340. A foggy HLZ morning will see flights cancelled or delayed throughout their network, which will hardly be an auspicious start for them. Additionally, they face a VERY tight schedule due to flight timing restrictions in ZQN.

Flying unproven third tier roots won't have any impact on either AirNZ or Jetstar.

Fixed that for ya :)

[theace]

Qantas adds more flights across Tasman
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11471070

[winner69]

Qantas adds more flights across Tasman
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11471070



As a regular on WLG/MEL this good news

AIR schedules hopeless ....some days no choice but QAN if one wants to avoid AKL or SYD

[Hoop]

I am left wondering what is the market for HLZ - NSN flights? HLZ ranks 10th in NZ in terms of passenger numbers, some 50,000 passengers per annum behind NPL. HLZ has not experienced any passenger growth for some time, while most other have seen significant growth.

KRA also only have a single Saab 340. A foggy HLZ morning will see flights cancelled or delayed throughout their network, which will hardly be an auspicious start for them. Additionally, they face a VERY tight schedule due to flight timing restrictions in ZQN.

Flying unproven third tier roots won't have a material impact on either AirNZ or Jetstar.

Yeah totally agree ... insignificant.

[Zaphod]

Fixed that for ya :)

Thanks Roger :P Obviously you're even more downbeat than me about KRA's chances in this market. While I wish Ewan's business well, I think this is all just a short-term pipe dream.

[Beagle]

Off Wikipedia the last Saab 340 was manufactured in 1998 which suggests this early 1980's design is well and truly coming to the end of its useful life.
I can't imagine that people will really be happy to fly in 20 year old slow aircraft (467 k.p.h.) and that the economics of this 34 seat capacity plane are all that good compared to a modern ATR62 like AIR use.
AIR are retiring the Beech 1900 because of this sort of age and related inefficiencies and maintenance issues. Wilson is realty scraping the bottom of the aviation barrel flying a design of this age and type on third tier unproven routes. His backers will need a lot of luck.
https://en.wikipedia.org/wiki/Saab_340

[brend]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11473472

More competition on the way.

It seems AIR monopoly for long haul destinations is slowing coming to an end. They have been very good at being the sole carrier for so many destinations for so long.

They only really faced competition on the Hawaii/Perth routes (excluding HKG due to code-share arrangements)

[Beagle]

That's just what I need, (NOT), to wrap up this forgettable first quarter of the financial year. The best thing about this first quarter is its over and its time for a drink or two.
Speaking of drinking...Just as well AIR start drinking cheap, (ostensibly unhedged) aviation fuel tomorrow...looks like they'll need that help in FY16.

[couta1]

That's just what I need, (NOT), to wrap up this forgettable first quarter of the financial year. The best thing about this first quarter is its over and its time for a drink or two.
Speaking of drinking...Just as well AIR start drinking cheap, (ostensibly unhedged) aviation fuel tomorrow...looks like they'll need that help in FY16.
Are you still $3.30 ish bullish on Air? Although none of this competition is going to affect the next set of results which should be excellent, I'm thinking breaking the $3 will be a tough ask now unless they can prove this time next year that profits can still be grown despite market share loss which looks inevitable now competition is heating up both regionally and internationally.

[Beagle]

Are you still $3.30 ish bullish on Air? Although none of this competition is going to affect the next set of results which should be excellent, I'm thinking breaking the $3 will be a tough ask now unless they can prove this time next year that profits can still be grown despite market share loss which looks inevitable now competition is heating up both regionally and internationally.

A few old Q300's domestically won't make a lot of difference but the China Eastern thing doesn't help. Factor in the lower currency and lower business confidence together with less optimism from consumers and I would have to concede that the tailwinds they'll enjoy from the lower oil price in FY16 are being somewhat mitigated by other factors. Stock currently trades on a super cheap FY 16 PE of 6.7 times forecast FY16 earnings of 38 cps and is growing various routes like Houston and South America and their recently recommenced Singapore flights so there's good in there too. Shareholders enjoy the services of an extremely capable senior management team with excellent governance support form a high calibre board. AIR is as good a stock as any to hold in this market and FAR better than most IMHO. Current price obviously includes a decent final divvy for FY15 that isn't all that far away and we have good earnings visibility for the year with their recent announcement. I think there's very few stocks that are better positioned to make SP headway in this tough market but who can say with any degree of certainty how long it might take to crack $3.00 again ? (You're a bit lucky to drag that out of me mate before I get into the much needed liquid refreshments after this sad quarter). I don't imagine very many people made too much if anything on the market since 1 April so I'm pretty sure I'm not the only one licking my wounds a bit. The Greek thing wasn't a great way to end the month / quarter was it !! The sharetrader competition thing is showing how tough it is to make money this year.

[neyney2010]

Rog, can you let me know when's it going back to three bucks again. I need to get my money back out.
To the nearest month is fine.

[couta1]

Roger I think my wounds are past licking, I'm thinking stitches are the only way to contain my six figured times two plus a bit current paper losses, amputation will only be considered as a last resort:eek2:

[Baddarcy]

A few old Q300's domestically won't make a lot of difference but the China Eastern thing doesn't help.

Agree on the Q300's, thou it does give Jetstar a beachhead to build from which i think we are all assuming is their aim, but that is years into the future. The China Eastern thing isn't all bad, it may impact some of the long haul routes to China, but it does mean that there will be more passengers in NZ for AIR NZ to fiy around domestically, the Chinese are not going to just fly into Auckland and drive all over NZ.

[biker]

Agree on the Q300's, thou it does give Jetstar a beachhead to build from which i think we are all assuming is their aim, but that is years into the future. The China Eastern thing isn't all bad, it may impact some of the long haul routes to China, but it does mean that there will be more passengers in NZ for AIR NZ to fiy around domestically, the Chinese are not going to just fly into Auckland and drive all over NZ.

Maybe not AIR NZ to fly around domestically. More like Jet Star with the Qantas partnership.

...............The airline is the fifth biggest in the world by the number of passengers carried and is expanding quickly in this region. Zhang said it began with five services a week to Sydney five years ago but had built this to 30 a week and in partnership with Qantas had plans to expand even further...........

[sammiesmiles]

Agree on the Q300's, thou it does give Jetstar a beachhead to build from which i think we are all assuming is their aim, but that is years into the future. The China Eastern thing isn't all bad, it may impact some of the long haul routes to China, but it does mean that there will be more passengers in NZ for AIR NZ to fiy around domestically, the Chinese are not going to just fly into Auckland and drive all over NZ.

most of the grouped chinese tourist only travel to Rotorua by coach. Other groups that travel to southern island mostly take Jet Star since their tickets are cheaper

[brend]

A few old Q300's domestically won't make a lot of difference but the China Eastern thing doesn't help.

Sorry mate - anyway the China Eastern thing was well signaled in the media quite a few months ago.

[mayday]

Traveling to China for business in August. Don't think China Eastern is particular cheaper than others so personally I don't really believe it can deteriorate AIR. The Chinese currency is at the highest point against NZD which means more n' more Chinese tourists may be coming in near future. Market is getting greater as well.

Also as a gold member of star alliance, I wouldn't mind even if AIR is a bit more expensive than others (within range 0 ~ 15%) coz I can get free access to lounges.

http://english.ctrip.com/flights/auckland-to-shanghai/tickets-akl-sha/?flighttype=d&dcity=akl&acity=sha&relddate=51&relrdate=57&startdate=2015-08-21&returndate=2015-08-27&startday=fri&returnday=thur&relweek=7&searchboxArg=t

[mayday]

By the way, I saw AIA were building more carousels at international terminal when I got back last Sunday.....just perspective ;)

[winner69]

Hey mayday ....with a handle like that you shouldn't be posting on this thread

[mayday]

Hey mayday ....with a handle like that you shouldn't be posting on this thread

bought a small package last week while I was overseas, just thought it was cheap :t_up:

I tried Qantas from Dubai to Sydney few months ago, service was ok but not as good as AIR. Emirates however is alot better.

Boeing 787-9 is less noisy than A380-800 but both are super comfy, just IMO

[Cricketfan]

I tried Qantas from Dubai to Sydney few months ago, service was ok but not as good as AIR. Emirates however is alot better.


What is it about Emirates and some other asian airlines that makes their service so good? (I haven't flown internationally for over a decade!)

[mayday]

What is it about Emirates and some other asian airlines that makes their service so good? (I haven't flown internationally for over a decade!)

It is a personal experience like you read on tripadvisor, same hotel some people give 5, some 4, 3....1

I have been flying with many airlines over years (mostly economy class), both air nz and emirates are the best so far, me reckon, based on on-time flight, food, beverage, cabin service...

[Regi]

It is a personal experience like you read on tripadvisor, same hotel some people give 5, some 4, 3....1

I have been flying with many airlines over years (mostly economy class), both air nz and emirates are the best so far, me reckon, based on on-time flight, food, beverage, cabin service...

I'd agree with those two airlines being the best overall but I must say I've had nothing short of exceptional service every time I've flown Singapore Airlines. I'm pretty elastic between these 3.

[Zaphod]

When Emirates (EK) first entered the trans-tasman market I was regularly flying the AKL-BNE sector in economy on EK exclusively. Both the hard and soft products were right on par with AirNZ's, however after a year or two there was some noticable declines in both EK products. But the big issue for me was that the slots weren't convinent. Leaving AKL after 5PM meant spending an extra night, so I went back to AirNZ which during NZ DST (QLD doesn't have DST) meant I'd arrive mid morning.

Differences in pricing were negligible.

[Zaphod]

It is a personal experience like you read on tripadvisor, same hotel some people give 5, some 4, 3....1

I have been flying with many airlines over years (mostly economy class), both air nz and emirates are the best so far, me reckon, based on on-time flight, food, beverage, cabin service...

I don't trust Tripadvisor reviews as a rule; I have seen people describing their experiences in the hotel in detail, but notice that they have often closed. Many of these reviews are bought on market, a lot like Facebook 'likes'.

[Zaphod]

Traveling to China for business in August. Don't think China Eastern is particular cheaper than others so personally I don't really believe it can deteriorate AIR. The Chinese currency is at the highest point against NZD which means more n' more Chinese tourists may be coming in near future. Market is getting greater as well.



China Eastern appear to be positioning themselves between a LCC and a budget full service carrier. I haven't flown with them personally, have some colleagues have stated that the food and aircraft itself are decidedly average, but offered good fares.

The Chinese tourism market is potentially huge, so there is probably more than enough room for both AirNZ and competitors on the sectors to/from China. The elephant in the room is any potential economic decline in China, which is a real possibility.

[sb9]

"BONUS PAYMENT TO QANTAS GROUP EMPLOYEES

SYDNEY, 3 July 2015:
Qantas Airways Limited today announced a one-off bonus payment will be made to all employees covered by an 18-month wage freeze policy as part of their collective agreement.

All Qantas, Jetstar, and other Group employees covered by finalised Agreements that include the wage freeze will receive a one-off payment worth five per cent of their base annual salary. The payment to eligible employees will be made shortly after release of the Group’s full year results on 20 August 2015.

Bonus payments for employee groups not currently covered by the wage freeze policy will be made once Agreements including the wage freeze are finalised. This bonus does not extend to employees who are part of management bonus schemes, which will be determined separately.

The bonus payment will be made to up to 28,000 Qantas Group employees, costing an estimated $90 million on full implementation. It is anticipated that the non-recurring cost of up to $90 million will be recognised in the Group’s 2016 financial year, outside of underlying earnings.

Qantas Group CEO Alan Joyce said the bonus was recognition of the contribution made by all employees to strengthening the Group’s long-term competitive position through the wage freeze and the delivery of all Qantas Transformation targets on or ahead of schedule.

"The rapid turnaround of the Qantas Group has only been made possible through the dedication and hard work of all our people," said Mr Joyce.

"Our ability to make these bonus payments reflects a bright future for the Qantas Group, provided we stay focussed on fully delivering the transformation program that has brought us this far."

Qantas expects to have realised at least $875 million of the targeted $2 billion of benefits in the Qantas Transformation program as of the end of financial year 2015.
"

Wonder if AIR employees are also given a special bonus...

[Beagle]

They got a nice bonus last year.

[winner69]

They got a nice bonus last year.

Hey Rog, being reported 'outside of underlying earnings' - ie an abnormal / non-recurring

Can't repeat next year then?

[Beagle]

Look who got a credit rating upgrade today...sweet...lower finance / lease costs on the international markets.

[percy]

Look who got a credit rating upgrade today...sweet...lower finance / lease costs on the international markets.

Fantastic news.
Confirms to me Luxon has been making all the right decisions.

[Bjauck]

Fantastic news.
Confirms to me Luxon has been making all the right decisions.
From basket case through bail-out to creditors' darling. With good management and government dosh, it shows that a turn around can happen...Greece and the EU please take note.

[Beagle]

From basket case through bail-out to creditors' darling. With good management and government dosh, it shows that a turn around can happen...Greece and the EU please take note.

Yeah....that'll probably take 15 years too :(

OTOH back to brighter topics...anyone see what happened to the oil price overnight and AIR's planes burning the cheap, mostly unhedged stuff now :)

[emveha]

[QUOTE=Roger;579900OTOH back to brighter topics...anyone see what happened to the oil price overnight and AIR's planes burning the cheap, mostly unhedged stuff now :)[/QUOTE]

And the Iranian deal closer than ever promises even further drop.

[Hoop]

Yeah....that'll probably take 15 years too :(

OTOH back to brighter topics...anyone see what happened to the oil price overnight and AIR's planes burning the cheap, mostly unhedged stuff now :)

Long term term historic charts have found no correlation between AIR shareprice and Oil price...I've repeated this several times on AIR thread...sigh.
Up comes the chart again...also added is the NZ$ V US$ which also shows no correlation to AIR but has some correlation with Oil.

Why no correlation with Oil? as on the surface it doesn't sound right ...but dig a little deepr and..some things spring to mind...Off the top of my head listed below are some adverse effects which can neutralise the positive Oil price drop effects
1....Lower oil prices can signal decreasing global economic growth or increased recession risk..Cyclical stocks very sensitive to economic growth changes
2....Lower oil prices gives extra advantage to new entrants without hedged contracts
3....Lower oil prices gives a large giant .eg Quantas increased advantage to invade and capture market share
4....Increased competition defenses to protect market share involves decreased margins to create a less attractive environment for future invaders.

No correlation with currency...Not much evidence that a falling NZ$ brings more tourists...if anything there's a hint of a rising NZ$ helping in raising the AIR price..
Visually from the chart Oil and NZ$ V US$ has a slight trend correlation notice when both fall it spells global recession time OIL falls due to lack of demand and NZ$ falls due to flight to safe havens..

Why all this seems condictory to Posters comments I don't know and I don't want to know, as with keeping it simple I see the chart signs and obey them..AIR is a Cyclical Stock..Air shareprice shows its cyclical havioural pattern on the chart... The chart is saying high risk so I don't buy

http://i458.photobucket.com/albums/qq306/Hoop_1/AIR06072015.png (http://s458.photobucket.com/user/Hoop_1/media/AIR06072015.png.html)

[Beagle]

Thanks for you post Hoop but over the last year we have seen ample evidence of lower oil prices = higher AIR SP. At least year's ASM the SP was $2.00. A cursory look at other airlines stock prices I follow show they've almost universally done well since the radical drop in oil price about 12 months ago so I don't agree with your point of view. AIR is ostensibly unhedged with its oil for FY16 but well hedged with the currency...so they're drinking the cheap stuff and like human's drinking $7 bottles of wine its happy times...just praying the hangover isn't bad lol
I guess that's essentially what you're saying, cheap oil causes other airlines to do silly things.

[sb9]

Big volumes through today...

[percy]

Where/how/if/when the credit rating is factored in who knows, what/if/why/when/how the charts will react I don't know,but I think it is significant,and certainly is positive for the company's fundamentals,going forward,or should that be onwards and upwards?.

[sb9]

Thought the sp would've reacted positively after all the factors mentioned above (Qantas up very strong on ASX today). Anyway, it should all be good closer to earnings announcement in a months time.

[Beagle]

Where/how/if/when the credit rating is factored in who knows, what/if/why/when/how the charts will react I don't know,but I think it is significant,and certainly is positive for the company's fundamentals,going forward,or should that be onwards and upwards?.

I believe a better credit rating gives them access to cheaper rates on their aircraft leases...usually the major international airline lease companies are pricing based off long term U.S. interest rates, currently very cheap, plus a margin for the specific client profile and AIR's specific credit profile just improved :)
Yep, huge volume, obviously a good debate between bulls and bears...some will be bearish on the economy, Greece e.t.c.

[sb9]

Finished on top by value and volume traded for the day on NZX, shame couldn't quite match Qantas on ASX, up almost 7% or 22c...

[Hoop]

Finished on top by value and volume traded for the day on NZX, shame couldn't quite match Qantas on ASX, up almost 7% or 22c...
Hmmmm...no it couldn't quite match QAN's +7.4% (https://www.anzsecurities.co.nz/directtrade/dynamic/quote.aspx?qqeg=AU&qqsc=qan&QuickQuote=+Go+) ......AIR +0.3% (https://www.anzsecurities.co.nz/directtrade/dynamic/quote.aspx?qqeg=NZ&qqsc=air&QuickQuote=+Go+) close though..eh;)

[tzbang]

Did I just see someone buy 1600,000 shares @ 2.57.. that's what just showed up in my asbsecurities chart, or is that some sort of browser trickery?

[kyanar]

Did I just see someone buy 1600,000 shares @ 2.57.. that's what just showed up in my asbsecurities chart, or is that some sort of browser trickery?

I'm seeing it too. Volume of 1.9m versus the 256k visible on NZX.com (NZX being delayed 20 minutes, and I think the quote summary on ASB securities is realtime). Refreshed and sometime between 11:40 and 11:44, 1.6m shares changed hands in a single trade (37 trades versus the previous 36)

[sb9]

Yeah, 1.6ml transacted off market @2.57. Looks like someone (big instos) is accumulating in the past few days...

[kyanar]

If it's off market, it could be NZSF. They've been shunting their shares from direct management to instos (https://nzx.com/companies/AIR/announcements/266696) so it could be more of the same.

[Zaphod]

Two articles of interest:

Qantas, American Airlines partnership 'benefits passengers'

"Qantas and American Airlines have gained interim approval from the competition regulator to deepen their alliance on trans-Pacific routes despite opposition from Air New Zealand."

http://www.stuff.co.nz/business/industries/70098303/qantas-american-airlines-partnership-benefits-passengers

New Air Canada flights raise prospects of trans-Pacific price war ""

http://www.smh.com.au/business/aviation/new-air-canada-flights-raise-prospects-of-transpacific-price-war-20150708-gi7tlo.html

[winner69]

Only interim but methinks AIR a little concerned

http://www.smh.com.au/business/aviation/accc-allows-qantas-american-airlines-to-start-new-services-in-december-20150709-gi89pe

[Joshuatree]

Retesting the 200DMA again after smashing down thru the 60DMA on re 8th june. Must be a fair few punters underwater atp following enthusiastic buy raves . Hopefully AIR picks up again leading to the Dividend but competition for the skies AIR flies is increasing.

[Beagle]

I hear they are going to do some body paint adds again and use really sexy women so we're all good :D

[percy]

Retesting the 200DMA again after smashing down thru the 60DMA on re 8th june. Must be a fair few punters underwater atp following enthusiastic buy raves . Hopefully AIR picks up again leading to the Dividend but competition for the skies AIR flies is increasing.

I am watching carefully.
Share price is under the 50 day EMA [$2.67] and the 200 day EMA [$2.56].
Will wait a few days to see whether we have a "break out" or a "fake out."

[pierre]

If last night's flight from Hong Kong is anything to go by biz is pretty good for AIR.

Flew back from Honkers to Auckland on NZ 80. Applied to upgrade from Prem Economy to Business but not an empty seat on the plane in any of the cabins.

[nzspeak]

Oil down on Iran. There was a little argument on the forum
whether oil price affected AIR- see what happens tomorrow.

[nzspeak]

I guess short term isn't an a definitive answer. Good day for AIR tomorrow I imagine though.

[Beagle]

If last night's flight from Hong Kong is anything to go by biz is pretty good for AIR.

Flew back from Honkers to Auckland on NZ 80. Applied to upgrade from Prem Economy to Business but not an empty seat on the plane in any of the cabins.

Nice to hear. I think people are getting a little over negative about the increased competition. Fact is AIR are also expanding and have a modern fuel efficient fleet and are now enjoying very low, (mostly unhedged), oil prices while contemporaneously enjoying some very favourable foreign exchange hedging. Forward PE of less than 7 and people can look forward to their 75th anniversary final fully imputed dividend in a couple of months. Happy holder and self confessed aviation enthusiast.

[emveha]

Funny to think that the 787-9 puts Tehran in range from Auckland.

[sb9]

Thanks pierre for posting your positive experience.

And you are right nzspeak. Hope its AIR day today on the market. QAN has been flying through on ASX over the aps few days.

Agree with you Roger, the market seem to hung up on negative news around competition. Am sure with top quality management (Luxon and co) they would've plans to combat and grow.

[percy]

I am watching carefully.
Share price is under the 50 day EMA [$2.67] and the 200 day EMA [$2.56].
Will wait a few days to see whether we have a "break out" or a "fake out."

Looks as though the fog is slowly clearing,and all flights will resume in about 10 or 20 minutes.
All travellers who have not purchased a ticket should do straight away.!

ie last sale $2.56 and buyer at $2.56 and seller $2.58.

[emveha]

Proposed travel tax = bad news for AIR? http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11480758

[Beagle]

Proposed travel tax = bad news for AIR? http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11480758

I think they are VASTLY overstating the effect of that. The cost of border crossing is looked at holistically as a total by all travellers. Australia's departure tax is substantially higher than ours and airport fees at Sydney are outrageous to say the least but it hasn't hurt their tourism has it !! London also recently substantially increased its departure taxes.

On the Iran deal...while August spot oil prices ended up marginally at close of trading, its the medium term extra supply coming to the market in 2016 and beyond that provides scope for encouragement in the long term price of oil.
Eventually its possible that Iran could re-establish their full 3.5m barrels per day export capability.

[winner69]

I think they are VASTLY overstating the effect of that. The cost of border crossing is looked at holistically as a total by all travellers. Australia's departure tax is substantially higher than ours and airport fees at Sydney are outrageous to say the least but it hasn't hurt their tourism has it !! London also recently substantially increased its departure taxes.

On the Iran deal...while August spot oil prices ended up marginally at close of trading, its the medium term extra supply coming to the market in 2016 and beyond that provides scope for encouragement in the long term price of oil.
Eventually its possible that Iran could re-establish their full 3.5m barrels per day export capability.

Whooping 142 quid (pounds) to get out of Heathrow

[ace5715]

If last night's flight from Hong Kong is anything to go by biz is pretty good for AIR.

Flew back from Honkers to Auckland on NZ 80. Applied to upgrade from Prem Economy to Business but not an empty seat on the plane in any of the cabins.

I flew back from Shanghai on Friday and that flight was totally full also.

[sb9]

Thanks for that ace5715, more evidence that its not as bad some might fear...

[Beagle]

Whooping 142 quid (pounds) to get out of Heathrow

Sure puts our passenger service charge, formerly known as departure tax of $25 into perspective doesn't it !!
http://www.aucklandairport.co.nz/AirportInformation/Departure-Tax.aspx

[Regi]

Since it seems we are sharing experiences...
Picked a friend up who flew in from Singapore last night on Air NZ after a Singapore airlines flight from Manchester to Singapore via Munich... AIR was totally packed whereas she had a spare seat next to her from Manchester to Munich and saw a couple of spares Munich to SG. Aside from load... the service on AIR was exceptional - professional yet friendly and approachable staff, food, refreshments, seats... everything was just better. She was quite disappointed in SG airlines for once.

[sb9]

Did i just see it close at $2.69, that's some performance for the day!!!

[Regi]

2.69?! Did I miss something...? Will it hold?

[neyney2010]

3 bucks tomorrow

[vin]

Did i just see it close at $2.69, that's some performance for the day!!!

Hmm, surely this spike can't just be from the new Iran agreement

[psychic]

It seemed all set to finish up at $2.62 but close auction $2.69! Was an ask pulled last minute? I see the spread post close is 10 cents - would this confirm this?

[Zaphod]

Still a wee while until the FY results come though, but perhaps there are some early bets being placed.

[couta1]

Air NZ is increasing domestic seat numbers in and out of Queenstown by 140000 this coming year in comparison to the previous 12 months, methinks this whole competition thing is being overplayed by the media and we will be back to $3 in the not too distant future:cool:. PS- The ski industry is now worth around 1.4 billion per year to our economy and growing with Air positioning themselves well to get a nice slice of this pie.

[tim23]

Another special divvy on the cards too I reckon.

[sb9]

Agree with you couta, the competition thing has been bit over played in my opinion.

Defienitely tim23, can smell a special divvy.

I reckon sp will push closer to $3 mark come results time and past that once results announced (not to mention the handsome divvy)

[Beagle]

Air NZ is increasing domestic seat numbers in and out of Queenstown by 140000 this coming year in comparison to the previous 12 months, methinks this whole competition thing is being overplayed by the media and we will be back to $3 in the not too distant future:cool:. PS- The ski industry is now worth around 1.4 billion per year to our economy and growing with Air positioning themselves well to get a nice slice of this pie.

Totally agree. Queenstown is absolutely going off, no surprises there as its such a stunningly beautiful part of the country and its really resonating as a destination with both overseas tourists and Kiwi's. The airport is widening its runway to allow night flights and I expect very strong and sustainable ongoing growth. AIR obviously see this too as 140,000 extra seats shows they understand the massive potential for even more growth this region has. I am sure most of us have favourite family memories of enjoyable holidays in and around Queenstown...more regular and convenient flight times makes it even easier to enjoy this world class resort area and the lower $kiwi will have tourists coming here in droves. I am waiting eagerly beside my food bowl like a keen beagle waiting for its next divvy feed :)

[Zaphod]

I am sure most of us have favourite family memories of enjoyable holidays in and around Queenstown...more regular and convenient flight times makes it even easier to enjoy this world class resort area and the lower $kiwi will have tourists coming here in droves. I am waiting eagerly beside my food bowl like a keen beagle waiting for its next divvy feed :)

We're both eagerly waiting! I bought up large again during the dip caused by the competition announcements. I've breached my self-imposed portfolio allocation percentage, so this better pay off!

[tzbang]

Just got back from Las Vegas. Trip from NZ to LA was on a refurbished AirNZ B777-200, it was mostly full, but a few empty cheap seats here and there. Trip from LA to Vegas was on Virgin America A320. From Vegas to San Francisco with United Airlines (awful flight, incompetent airline) SF to NZ on 777-300 (much nicer plane, completely full passenger load, the seating is a bit tight but service and comfort level on a long haul cattle class flight at the price I paid, you could not expect more. We arrived at 5am and I heard several passengers remark that they felt surprisingly good.

[Jantar]

....the seating is a bit tight but service and comfort level on a long haul cattle class flight at the price I paid, you could not expect more. ....
I recently did a similar trip to LA on ANZ 777-300 and also the seating slightly tight. The next leg from LA to Munich on a Lufthansa A340 really showed me what tight seating is. The Lufthansa service was slightly better than air NZ, but the Air NZ comfort was much better.

[vin]

Nice start, pushing through $2.70.. We love it!

[Beagle]

I recently did a similar trip to LA on ANZ 777-300 and also the seating slightly tight. The next leg from LA to Munich on a Lufthansa A340 really showed me what tight seating is. The Lufthansa service was slightly better than air NZ, but the Air NZ comfort was much better.

Its nice to hear the stories about people's experiences as a passenger on AIR, please keep them coming.
Even I would concede that there's too many accountant's running these airlines now...whatever happened to the romance of flight ?

Its all about shifting people from point A to Point B in the most efficient and effective manner. Visiting AIR's exhibition at Te Papa and sitting in the internal mock-up they have of the original Solent flying boat and feel the difference in seat sizes and atmosphere compared to modern planes and experience what I'm referring too. In the same exhibition they had seats from the new Dreamliner, Business first, which the stewardess manning the exhibition proudly told me was first class and premium economy. I was underwhelmed by both.

Accountants have designed these seats I tell ya !! and its the same for virtually all airlines with the notable exception of Singapore which still has really decent proper sized seats in economy, business and first class...wonder how long that will last ?

Please excuse these ramblings from a full sized XXL bloke, probably doesn't matter for those that fit the average seat profile of the average passenger which I believe is 78 kg's ? That said several slightly larger than 78kg people at the same AIR exhibition were also underwhelmed with AIR's new premium economy and business seats with one commenting, what's so premium about that !!
Maybe they've gone a little too far in the direction of efficiency with their fit-out ? Perhaps, perhaps not but all the airlines seem to be headed in that direction with their newer planes, cattle class has become a very appropriate term !!

I suppose there's always the "minor" consolation that when the first Solent flying boat ran services 75 years ago a ticket to Sydney equated too one year's average workers wages, just a little more "efficiently" priced now :)

[Derain]

Its nice to hear the stories about people's experiences as a passenger on AIR, please keep them coming.
Even I would concede that there's too many accountant's running these airlines now...whatever happened to the romance of flight ?

Its all about shifting people from point A to Point B in the most efficient and effective manner. Visiting AIR's exhibition at Te Papa and sitting in the internal mock-up they have of the original Solent flying boat and feel the difference in seat sizes and atmosphere compared to modern planes and experience what I'm referring too. In the same exhibition they had seats from the new Dreamliner, Business first, which the stewardess manning the exhibition proudly told me was first class and premium economy. I was underwhelmed by both.

Accountants have designed these seats I tell ya !! and its the same for virtually all airlines with the notable exception of Singapore which still has really decent proper sized seats in economy, business and first class...wonder how long that will last ?

Please excuse these ramblings from a full sized XXL bloke, probably doesn't matter for those that fit the average seat profile of the average passenger which I believe is 78 kg's ? That said several slightly larger than 78kg people at the same AIR exhibition were also underwhelmed with AIR's new premium economy and business seats with one commenting, what's so premium about that !!
Maybe they've gone a little too far in the direction of efficiency with their fit-out ?

Having recently flew from Hong Kong to Auckland on the refurbished 777 flight I had similar experience. The plane was fully seated (not even a single space left). The new entertainment system they installed was marvelous, best of any airline I have flown recently. However, the seating and storage was completely underwhelming. The new overhead storage seems to be much smaller than other airlines and with a fully packed plane, people were struggling to fit the carry ons in the storage and had to store them in front of the seat.

We flew premium economy and even my partner, who is only 160cm and 45kg noticed the constricted seating width and complained. On the other hand, our flight to Japan on Jetstar was about 30% loaded and (surprisingly) felt much better in terms of space and comfort.

It is a bit of a dilemma between wanting a fully loaded plane (for profit and efficiency) as a shareholder and the comfort of having some empty space around you (as a passenger). I do worry that the current approach on jamming as many people on AIR NZ flights will have a negative impact on passenger perception.

[Beagle]

It is a bit of a dilemma between wanting a fully loaded plane (for profit and efficiency) as a shareholder and the comfort of having some empty space around you (as a passenger). I do worry that the current approach on jamming as many people on AIR NZ flights will have a negative impact on passenger perception.

Thanks for you feedback and I worry too. Interesting to note that so called premium economy seats are 18.5 inch width and regular economy on Singapore has 19 inch width seats, source www.seatguru.com
Is that really "premium" economy ? I personally wouldn't bother with business or premium economy as the difference isn't anywhere near justification for the extra price...just suck it all up and relax and "enjoy" their 17.8 inch width regular economy seats and try not to form mental pictures of a sardine in a can LOL.
Disc - Still hold AIR just airing, (pardon the pun) my seat size concern.

[mikeybycrikey]

I personally wouldn't bother with business or premium economy as the difference isn't anywhere near justification for the extra price..

That's why you're an accountant! I've only done the premium economy thing a couple of times, when using points to get an upgrade. It was worthwhile then but I would struggle to justify actually paying for it.

It is an interesting conundrum for an airline: how you you cram as many people on a plane as possible while still making it feel like a premium experience?

I recently flew on Air NZ to San Francisco and back. Both in economy. One way was on a 777-300 (I think) which was all pretty nice and new. On the way back, it was a tired old 777-200. I'm guessing it must be due for a refit soon as it was a real let-down after the earlier flight. I can see why AIR is trying to keep a modern fleet.

I did notice the difference between the 10-across 777-300 and the 9-across 777-200. The seats didn't seem particularly smaller but the aisle definitely was narrower.

[Beagle]

That's why you're an accountant!
It is an interesting conundrum for an airline: how you you cram as many people on a plane as possible while still making it feel like a premium experience?



LOL Yeah, guilty as charged. It is quite "the" conundrum. I haven't had the joy myself yet but I think the lower cabin altitude pressure, better quality air, super duper new fancy lighting, huge windows and modern feel of a Dreamliner probably do "the trick" As you've alluded too, the newer 777-300 with 10 across seating which must imply less width to the seating (narrower aisle notwithstanding), felt pretty nice and new. Throw in the other features of the Dreamliner and apparently they're getting extremely positive feedback so the trick appears to be working with customers and that's what counts !! better lighting, much bigger windows, lower cabin pressure 6000 ft (instead of 8,000 ft pressure) and better quality air and you have the dream experience eh ?

[tzbang]

It is a bit of a dilemma between wanting a fully loaded plane (for profit and efficiency) as a shareholder and the comfort of having some empty space around you (as a passenger). I do worry that the current approach on jamming as many people on AIR NZ flights will have a negative impact on passenger perception.

More of a sign of the times for most airlines rather than just AIRNZ which is squeezing people on.. but yeah, it is a delicate balance. I was conflicted on the recent long haul as you say: I felt a bit cramped and I am a small guy.. However, the plane was full and passenger perception seemed good according to the comments I heard. I think cattle class appear to accept that it's the cheap seats, you make yourself as comfortable as possible, get something to eat, drink a few wines and go to sleep so you forget all about it.

[WingingIt]

People's thoughts on the Dividend Reinvestment Option when I have only a small holding ~600 shares? Cant imagine dividends would add up to that much with my small number of shares and I have a long time frame (I'm 21).

Cheers Guys

[Beagle]

People's thoughts on the Dividend Reinvestment Option when I have only a small holding ~600 shares? Cant imagine dividends would add up to that much with my small number of shares and I have a long time frame (I'm 21).

Cheers Guys

Welcome to the forum and its good you are starting young. To the best of my knowledge the DRP is currently suspended so you'll simply have to save your dividends up and buy some more on market :)

[newtrader]

Regardless of size of holdings, DRPs are a usually a good way to slowly increase your holdings (avoiding brokerage fees) and possibly acquire shares at a small discount.


People's thoughts on the Dividend Reinvestment Option when I have only a small holding ~600 shares? Cant imagine dividends would add up to that much with my small number of shares and I have a long time frame (I'm 21).

Cheers Guys

[WingingIt]

Regardless of size of holdings, DRPs are a usually a good way to slowly increase your holdings (avoiding brokerage fees) and possibly acquire shares at a small discount.

Thats conclusion I had come to and glad at least one other person thinks so too!

[WingingIt]

Welcome to the forum and its good you are starting young. To the best of my knowledge the DRP is currently suspended so you'll simply have to save your dividends up and buy some more on market :)

Yeah I wish i had bought more when they dropped to 2.35 the morning of the Jetstar announcement.

I only asked because I was in my Link Investor Center and there were options for Full or Partial Participation in a Reinvestment Plan.

Maybe its back up and running? I cant seem to find anything about it in the AIRNZ Investor Centre

[Beagle]

Yeah I wish i had bought more when they dropped to 2.35 the morning of the Jetstar announcement.

I only asked because I was in my Link Investor Center and there were options for Full or Partial Participation in a Reinvestment Plan.

Maybe its back up and running? I cant seem to find anything about it in the AIRNZ Investor Centre

You and me both but I got some at circa $2.40 so not complaining. Link investor centre is showing it as an option but you will find that the company has announced the scheme is presently suspended. Not sure from what date, but I am certain it is currently in suspension as the company has no need for extra capital, they're generating cash hand over fist with oil where it is. Probably got well north of a billion dollars of cash on hand as at balance date, (granted a lot of that is pre-paid travel and quite a bit if it mine for that matter, but its cash on hand nonetheless).

[vin]

Yeah I wish i had bought more when they dropped to 2.35 the morning of the Jetstar announcement.



I've lost count the amount of times I've kicked myself for not buying in at a certain point, you know what they say about hindsight eh

[tim23]

They have suspended DRP suspect because they don't need the money - a DRP is like a mini rights issue each time, GMT did the same with theirs too.

[sb9]

I've lost count the amount of times I've kicked myself for not buying in at a certain point, you know what they say about hindsight eh

Yeah, it's wonderful thing hindsight, isn't it. I did top up on that day at 2.45, couldn't let that opportunity go by. I reckon it'll be $2.90 very soon, not to mention that FY fully imputed divvy and possible special divvy to mark 75th anniversary.

[iceman]

People's thoughts on the Dividend Reinvestment Option when I have only a small holding ~600 shares? Cant imagine dividends would add up to that much with my small number of shares and I have a long time frame (I'm 21).

Cheers Guys

Welcome to the forum WingingIt. I highly recommended full participation in any DRP's you can have for shares in your long term portfolio. It is a painless and great way to compound your investment if you are not starving for the cash divies.

[Beagle]

Yeah, it's wonderful thing hindsight, isn't it. I did top up on that day at 2.45, couldn't let that opportunity go by. I reckon it'll be $2.90 very soon, not to mention that FY fully imputed divvy and possible special divvy to mark 75th anniversary.

You're on to it mate:t_up: :t_up: All those people who got their knickers in a twist and sold around $2.40 just because Jethole are thinking of flying a few ancient, (so old and decrepit they can't sell them and they have been parked up for ages), Q300's domestically are going to be feeling a bit silly aren't they, if they don't already.

[blockhead]

All you AIR enthusiasts, is it too late to hop on AIR $2.72 and fly right through till it connects with AIR $3.00 ?

Or should I have used Grabashare back when Flight $2.40 was leaving the terminal ?

[vin]

Who really knows, I'm thinking it'll push through to $3 over the next couple of months.

[neyney2010]

I know. It will get to $3 shortly.
I backed the truck up at $2.39 when JetLag 'threatened'.

[Regi]

All you AIR enthusiasts, is it too late to hop on AIR $2.72 and fly right through till it connects with AIR $3.00 ?

Or should I have used Grabashare back when Flight $2.40 was leaving the terminal ?

There was a $2.60's AIR flight that sat at the terminal for a little while before AIR $2.30 arrived without warning and I know a few on here, including myself, and nearly Roger I believe, jumped aboard somewhere on flight $2.60 thinking that that was an excellent grabashare. I grabbed a share top up at $2.64 and current buy-in isn't too much more so it's never too late I'd say (I also bought in at $2.40 and $2.82 - hopefully not too long till the latter recovers).

You also don't want to be the guy that fell asleep in the Koru lounge and missed the AIR $3.00 flight with a fantastic annual report for mid-flight reading and a special divvy for onboard refreshments which departs within the next few months.

[Beagle]

There was a $2.60's AIR flight that sat at the terminal for a little while before AIR $2.30 arrived without warning and I know a few on here, including myself, and nearly Roger I believe, jumped aboard somewhere on flight $2.60 thinking that that was an excellent grabashare. I grabbed a share top up at $2.64 and current buy-in isn't too much more so it's never too late I'd say (I also bought in at $2.40 and $2.82 - hopefully not too long till the latter recovers).

You also don't want to be the guy that fell asleep in the Koru lounge and missed the AIR $3.00 flight with a fantastic annual report for mid-flight reading and a special divvy for onboard refreshments which departs within the next few months.

Classic post. No question when Jetheap were making silly noises with their antique turboprop planes was the time to back the truck up, as stated by myself and others but notwithstanding that golden missed opportunity there's a nice juicy in-flight divvy coming and shareholders turn to be given the royal 75th anniversary treatment, (special guests, dignitaries and selected travel agents got a special Dreamliner flight to Sydney and guided tour and entertainment at the bay the first Solent boat landed 75 years ago...Chris, my invite appeared to go astray in the mail, please be more careful next time), so buckle up and enjoy the ride. Forward PE is less than 7...how many companies with a 75 year history that you know of trading on a forward PE of 7 when the market average is 17...join the dots and enjoy the ride. Caution...there is turbulence on every flight so those expecting a silky smooth flight experience needn't apply...that includes those with a phobia about flying like our dear friend Winner69.

[sb9]

https://nzx.com/companies/AIR/announcements/267329

Another strong month of operational performance. This combined with lower oil prices, its all onwards and upwards for this pup...eh Roger?

[Beagle]

https://nzx.com/companies/AIR/announcements/267329

Another strong month of operational performance. This combined with lower oil prices, its all onwards and upwards for this pup...eh Roger?

Yes another good solid month's stat's with all parts of the business working like a well oiled swiss watch.
Very satisfying to see group wide passenger load factor for the whole year maintained at a very healthy level of 84.1%, identical to last year notwithstanding a 6.6% RPK capacity increase.
YOY yield comparisons are also extremely satisfactory given the massive sea change in oil price and consequent increase in international competitive pressure on fares.
I also think the lower dollar will significantly boost tourism in the medium term and we recently had the accord reached with the Iranians which bodes well for oil prices in the foreseeable future.
Regarding the June month it is also nice to see load factors and demand holding strong in June notwithstanding the slightly softer economic conditions.
We are extremely well positioned !!

[Regi]

I'm not reading too much into it but why wasn't the market very happy with these results? I wouldn't have thought people would have such specific and crucial expectations of a months performance to warrant a 6 cent drop from the days high? As far as I can tell there's nothing wrong with the figures put out today... anyone able to shed some light?

[sb9]

Yeah, its a bit of turnaround from 2.765 this morning. All I can think of is sentiment and someone chickened out...

[Master98]

Yes another good solid month's stat's with all parts of the business working like a well oiled swiss watch.
Very satisfying to see group wide passenger load factor for the whole year maintained at a very healthy level of 84.1%, identical to last year notwithstanding a 6.6% RPK capacity increase.
YOY yield comparisons are also extremely satisfactory given the massive sea change in oil price and consequent increase in international competitive pressure on fares.
I also think the lower dollar will significantly boost tourism in the medium term and we recently had the accord reached with the Iranians which bodes well for oil prices in the foreseeable future.
Regarding the June month it is also nice to see load factors and demand holding strong in June notwithstanding the slightly softer economic conditions.
We are extremely well positioned !!
what's wrong Roger? close down 6.5c on back of strong month of operational performance, could be just shock off lose parts.

[Beagle]

Caution...there is turbulence on every flight so those expecting a silky smooth flight experience needn't apply

Extract from post 2962 above. I can't see a problem, maybe a little bit of profit taking after showing some strength lately ?

[vin]

Wouldn't be surprised if it bounced back tomorrow / monday.

I also considered trimming my portion of AIR with the good run over the last few weeks.

[mikeybycrikey]

I'm not reading too much into it but why wasn't the market very happy with these results?

I'm not sure that it has got anything to do with the update. The update was released at 11.30am but the price didn't start dropping until after 3.30pm. Seems a bit odd.

[Beagle]

Fascinating insight into what its like to work at AIR

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11485589

[Yoda]

From 2970
"I'm not sure that it has got anything to do with the update. The update was released at 11.30am but the price didn't start dropping until after 3.30pm. Seems a bit odd."



If shares went up every single day, it would be silly. It just doesnt happen. Some father probably had a wedding to pay for.... Or needed a new car. It is trending up , so lets be happy. Dont panic unless it hits the 200 MA again

[Hoop]

A few of NZX stocks got sold down in the last 1 hr or so of trading today. I noticed it showed up on the day charts...the NZX50 index about the same time (-2hr) as a dip happened in the AllOrds from 1.30 to 2.30pm Oz time... Allords recovered when NZX was closing.... also a dip blip on the Sensex at 10.30am their time which is near to 5.00 pm NZ time..

.... I'm not sure if the dip behaviour is related could be coincidences ....but whatever caused it, it affected AIR more than most other NZX stocks ...
I don't worry about these things as they occur often....Perhaps somewhere in the world, Fat Finger Freddie did an oopsie and caused Mr Market's heart to skip a beat or two.... like a mouse fart in the elephant room

[kiora]

Fascinating insight into what its like to work at AIR

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11485589

Great article :t_up:

[Yoda]

Thanks Hoop, and nice analergy!

[blockhead]

Thanks Hoop, and nice analergy!


"analogy" Yoda, "analergy" would suggest you were allergic to either elephants or rodent exhaust gas

[Beagle]

Great article :t_up:

Yes its a fascinating insight into how a very good pragmatic leader can work towards changing the entire culture of an airline into a collaborative team environment, no small feat when there's 11,000 staff, all with their own vested interest and agenda's !! I have huge respect for Chris Luxon and having met him and seen him in action at last year's ASM he seems to have a genuine ability to engage with people from all walks of life in a warm and respectful manner. I really rate him as a very good communicator, strategic thinker and leader.

[sb9]

Yes its a fascinating insight into how a very good pragmatic leader can work towards changing the entire culture of an airline into a collaborative team environment, no small feat when there's 11,000 staff, all with their own vested interest and agenda's !! I have huge respect for Chris Luxon and having met him and seen him in action at last year's ASM he seems to have a genuine ability to engage with people from all walks of life in a warm and respectful manner. I really rate him as a very good communicator, strategic thinker and leader.

Couldn't agree more, have heard him on ZB radio few times and he's very inspiring leader and very affable communicator.

On the another note, just friendly reminder that oil dropped further overnight...

[Beagle]

Yes it certainly did. Craigs released a research note yesterday on the back of the June Operating Stat's which round out the FY15 year. Pretty much how I saw it as I commented earlier in post #2964.

Brief overview of their comments.
Rating BUY Price Target $3.30

Air has a strong year and has a strong near term outlook.
AIr has guided to FY15 Profit Before Tax of $520-$530m (excl VAH), up 58% YOY.

FY15 group operating metrics were strong with AIR managing to stimulate demand to match significant capacity increases. Importantly AIR has done this without impacting yield.
FY15 Group yield is up 0.2% YOY or 0.9% excl FX.
This is no mean feat given much lower fuel prices and significant capacity expansion and highlights that demand remains robust across their main sectors.
They note the lower currency will be one of the challenges to manage in FY16 as are increased competition.

FY15 EPS estimate 34 cps
FY16 EPS estimate 38 cps Currently trades on FY16 PE of 7.2 times.

Too me this seems too low considering their proven record noted above in terms of stimulating demand to match capacity expansion and a ten year average PE of 10 which you could argue should be higher given 30 year low interest rates and the fact that this company is now growing capacity as well as EDITDA. You could argue that FY16 is a further good opportunity for them to grow demand further in line with further capacity growth due to the current very low oil prices. $999 return special fares to the States, Honalulu or Singapore anyone ?

I concur with Craigs, there is real value all the way up to $3.30 and arguably beyond.

[winner69]

Mo says the higher AIR profits go the lower the PE

Winner says higher the AIR shareprice goes the bigger the inevitable crash (price that is)

So watch the squiggly lines closely (without rosé tinted glasses)

You all be happy at the mo .....winner not tempting fate by buying AIR

[winner69]

Winner a loser by not getting on this bird :D

......but probably saving hundreds of lives

Anyway Scales will see right if HNZ doesn't. Don't want a finger in every pie

You be OK with AIR but pease watch that squiggly line closely. Please do

[sb9]

I think trading is today bit patchy and lacklustre...just moving sideways, very light volume so far.

[Beagle]

LOL I deleted that one as I didn't want to upset you mate but you were too quick. Top company with truly exceptional leadership, trading on really compelling metrics including cum juicy 75th anniversary fully imputed final divvy.
What's not too like unless your a nervous or superstitious passenger...

[Baddarcy]

I think trading is today bit patchy and lacklustre...just moving sideways, very light volume so far.

Unfortunately i think you spoke too soon...

[sb9]

Unfortunately i think you spoke too soon...

Never mind, still light volume though. When its patchy and moving sideways there are always few nervous ones that have jitters...

[Robomo]

Interesting to look overseas on how US airlines are doing on their just-announced 2 Q results....

United: 2Q profit up 51% on last year, half year profit $1.2 billion
Southwest: 2Q profit up 31% on last year. Fuel unhedged for 2018 and reviewing 2016 & 17 hedging.
Alaska: 2Q profit up 42% on last year - $234 million.

This is consistent with almost all airlines worldwide; significantly increased profits. I expect Air NZ to be in the same league with continuing big profit increase (& bigger divvy as well!)

[KiwiGekko]

A bit of a sell off happening the last couple of days and looks like someone really wanted to get out over on the ASX though with AIZ closing at $2.28 (down 14 cents or 5.79%). The 26th of August cannot come soon enough huh?

[Zaphod]

Interesting to look overseas on how US airlines are doing on their just-announced 2 Q results....

United: 2Q profit up 51% on last year, half year profit $1.2 billion
Southwest: 2Q profit up 31% on last year. Fuel unhedged for 2018 and reviewing 2016 & 17 hedging.
Alaska: 2Q profit up 42% on last year - $234 million.

This is consistent with almost all airlines worldwide; significantly increased profits. I expect Air NZ to be in the same league with continuing big profit increase (& bigger divvy as well!)

And with PE ratios of:

United: 8.2 (down recently from 9.5)
Southwest: 15.1
Alaska: 13.6

[Robomo]

And AirNZ PE ratio of 11.55% (ASB Sharebroking).

[Zaphod]

And AirNZ PE ratio of 11.55% (ASB Sharebroking).

IMO recent anticipation of the FY15 result has driven the SP and (consiquently) the PE ratio up, so we should probably evaluate on the basis of forward PE for AirNZ at this point.

[Beagle]

Looking at historic EPS is useless at this point. Need to look at the year about to be announced and the company has issued pretty clear guidance of $520-$530m earnings before tax. Craigs have worked this out to be approx. 34 cps after tax so on Friday's close that gives a PE of about 7.5 times for FY15 earnings and they are forecasting EPS of 38 cps next year so the PE for FY16 is a pretty silly 6.8 times, based on $2.60, (sorry I can't remember the exact closing SP on Friday)....pretty cheap compared to its international peers isn't it !!

P.S. Anyone notice Nymex oil now has a 47 handle on it and AIR is mostly unhedged for FY16 !!!

[Regi]

A quite different and personal Interview with Chris Luxon I don't think many of you would've seen: https://www.oompher.com/wise-words/business/interview-with-christopher-luxon/

[Beagle]

Thanks mate, clearly he's a truly inspirational leader.

[sb9]

Thanks for the link Regi.

Is he good, isn't he Mr Luxon. Very inspiring to listen to as always...great leader and CEO.

[Robomo]

Comes over somewhat like John Key - both have the ability to relate to people in a very natural way.

[sb9]

Very interesting post...

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11488059&ref=rss

[Beagle]

Yes and this http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11480115

Another little known and never before discussed fact is Jetstar charge $5 per one way sector booking to make a booking using your credit card on their website, (how 90% plus people do it), compared to $4 per sector for AIR.
Not a lot of difference granted, but when one already suspects $4 more than generously recovers AIR's credit card fees imposed upon it by the banks, then a 25% higher charge by Jetstar can't be anything other than a deliberate over-charging.

But wait there's more....Jetstar charge more for baggage $12 from memory vs $10 per sector for AIR and if you want a seat where your 6ft + frame doesn't involve intense pain from having your knees rammed in against the seat in front that'll be $22 more per sector flown thank you, AIR are $10. Further, addingeven more insult to injury AIR's domestic seats are typically 31 to 33 inch pitch whereas Jetstar are typically 29 inch pitch which makes it far more likely that a significant percentage of Jetstar's passangers will have to suffer their seat upgrade price rort.

In summary Jetstar fares can appear cheap but you get what you pay for with their old planes and extremely cramped seats and anything extra you order whether through your own selection process of their cunning / under-handed ? pre-selected process, they charge through the nose for.

Their obstinate approach, (Australian cricket under-arm bowling anyone ?), regarding pre-selected add-on's is in stark contrast to AIR voluntarily complying with the Commerce commissions recommendation. Jetstar's approach arrogant ?, you be the judge, jury and when you come to which ariline to fly, the executioner :)

[sb9]

Good post there Roger.

But for market sentiment the sp should've been closer to $2.90 I reckon, with falling oil prices and I'm sure you said somewhere that from beginning of this month they do not have any hedge in place for oil. In which case, the forward earnings have more momentum that what they've been.

[Regi]

Wouldn't we expect to see a juicier SP in the coming weeks leading up to dividend dates aswell as from unhedged oil etc? Not entirely sure how it all works around ex-div.

[Xerof]

Sorry sb9, all patently untrue.

The last update on fuel hedging shows they are carrying a 73mill loss on hedges to end of FY15, and a 14m loss on FY16 so far. That was in May, so those hedges will be even further in loss now with oil stable but currency down. In the meantime, further hedges will have been put in place. Granted, some of their requirements will remain unhedged, but with oil relatively stable now, and the currency falling further, it is unlikely to have made a lot of difference.
Like most other company's AIR have a prudent hedging policy, with very little wiggle room for the Treasurer to display any risk taking skills. Unfortunately for him but fortunately for shareholders, directors will always cover their arses, and insist the policies are adhered to.

There are a few US airlines who take massive risks with fuel costs, but they tend to go in and out of Chapter 11 with each cycle:)

In the end it's just timing difference, so they should see some benefit in future years when the oil cycle turns back up, but then everyone benefits, and fares will drop anyway.

[mikeybycrikey]

The last update on fuel hedging shows they are carrying a 73mill loss on hedges to end of FY15, and a 14m loss on FY16 so far. That was in May, so those hedges will be even further in loss now with oil stable but currency down.

They might have lost $73 million on the hedges but this should be more than made up for by reduced fuel costs. Since they were 62% hedged in H2, then the reduced fuel bill would be $108 million, I guess.

Also for the future, the hedging is at a much lower cost. H2 15 Brent collars were at 105/96, for H1 16 they are at 69/56. Close to $40 per barrel lower.

Also, AIR might be losing money on the hedges now but they will inevitably make it back the next time the United States starts another war for oil (or freedom, or whatever). Vote Republican, get war with Iran?

[Xerof]

Absolutely correct. My point was they were NOT completely unhedged from a certain date as sb9 was ill-informed about.

It's not strictly a loss either, more of an erosion of the full possible impact

[sb9]

Point taken Xerof...

[Beagle]

They are also very well hedged in terms of the $U.S.. How much of this is used for capex on new planes v normal operational costs, who would know. About half their revenue comes from overseas ticket sales so there's a natural hedge right there and of course a lot of their costs are in $Kiwi e.g. 11,000 staff.

[Zaphod]

They are also very well hedged in terms of the $U.S.. How much of this is used for capex on new planes v normal operational costs, who would know. About half their revenue comes from overseas ticket sales so there's a natural hedge right there and of course a lot of their costs are in $Kiwi e.g. 11,000 staff.

Aircraft operational costs, maintenance, lease payments, interest etc. could still take some shine off AIR's profit, despite USD revenue climbing due to the FX rate. I suspect the former will outweigh the latter. The upcoming FY announcement should still be significant though!

[Robomo]

AirNZ's latest 787-9 has just been delivered (24 July 2015) in Seattle and presumably has now arrived in Auckland. Nice to now have 4 of these revenue/profit-generators in operation.

[Beagle]

AirNZ's latest 787-9 has just been delivered (24 July 2015) in Seattle and presumably has now arrived in Auckland. Nice to now have 4 of these revenue/profit-generators in operation.

Very nice...I suspect they might have used some of their FX covered funds to settle-up on that new bird.

[sb9]

Yep, its all looking good.

[brend]

From my understanding another one is also due in the next few weeks.

both aircraft were test frames that were reworked so AIR got them for a steal as compensation for the delays as launch customer.

As a result these test frames (I believe) weigh quite a bit more than the newer frames. I'm not sure how much of a difference was made during the reworking.

[Beagle]

From my understanding another one is also due in the next few weeks.

both aircraft were test frames that were reworked so AIR got them for a steal as compensation for the delays as launch customer.

As a result these test frames (I believe) weigh quite a bit more than the newer frames. I'm not sure how much of a difference was made during the reworking.

Music to my ears. Nothing cheers up an accountant more than dirt cheap capex on ultra efficient aircraft.

[sb9]

Hmmm...still struggling to push through higher, on the other hand QAN flying high on Asx.

[Beagle]

Hmmm...still struggling to push through higher, on the other hand QAN flying high on Asx.

Interesting isn't it ! Buying opportunity ?

[winner69]

Virgin reduced losses a well

[sb9]

Interesting isn't it ! Buying opportunity ?

Definitely, but have maxed out on my allocation on this.

[tzbang]

I think most of us have. But it does seem AIR is destined to forever be glancing an envious eye at QAN.

[Robomo]

Roger is banned! Why?

[sb9]

He'll be back tomorrow, check out the discussion on HNZ thread.

[Beagle]

Auckland Napier return today. ATR72, nice plane but the seats are very hard. 75% full on the leg down, 90% full on return. Winner would be proud of their ethnic diversity on the downward leg, one male Chinese flight steward and a young Maori air hostess. Back to the usual kiwi women crew on the way back and one of them recognised me which was nice, she's good mates with a couple my wife and I know very well. Planes have been quite full lately she said, good feeling in the company and staff morale is good.

[Master98]

Auckland Napier return today. ATR72, nice plane but the seats are very hard. 75% full on the leg down, 90% full on return. Winner would be proud of their ethnic diversity on the downward leg, one male Chinese flight steward and a young Maori air hostess. Back to the usual kiwi women crew on the way back and one of them recognised me which was nice, she's good mates with a couple my wife and I know very well. Planes have been quite full lately she said, good feeling in the company and staff morale is good.
lol Roger, you must be very proud of be one of many owners of Air New Zealand.

[winner69]

Diversity always there at the bottom end of the pecking order

AIR Board sort of OK with 2 females out of 7 but seems to lack a bit on the ethnicity side.

[Beagle]

Diversity always there at the bottom end of the pecking order

AIR Board sort of OK with 2 females out of 7 but seems to lack a bit on the ethnicity side.

You could easily fix that eh bro, appoint that young Maori woman and young Chinese man to the board and then we could have the annual report printed in Maori and Mandarin followed by English translation and we'd all be sweet....until some Russian immigrant started complaining :D

Yes master, I'm a proud Air New Zealander...must be time to buy some more...after all if that stupid looking red kangaroo can fly that high then...

P.S. Anyone else notice the oil price in overnight trading on Wall St ?
http://www.cnbc.com/2015/08/02/us-crude-slips-below-47-on-weak-china-data-ample-supply.html Brent down a whopping $2.80 !!

[Regi]

P.S. Anyone else notice the oil price in overnight trading on Wall St ?
http://www.cnbc.com/2015/08/02/us-crude-slips-below-47-on-weak-china-data-ample-supply.html Brent down a whopping $2.80 !!

Yup! Was going to post that. How low can it go?

[Zaphod]

Yup! Was going to post that. How low can it go?

Iran have a huge stockpile of oil that could flood the market and put further downward pressures of pricing. This may trigger other oil producing nations to decrease production, but thus far major price decreases don't seem to have made any difference to production rates.

[Beagle]

Yup! Was going to post that. How low can it go?

$10 barrel http://money.cnn.com/1998/11/30/economy/oilprices/

I remember it fondly. Oil did in fact get to $9 at one point and diesel was 42 cents a litre. Jet A1 probably in the 20 something cents a litre range at that stage with AIR's vast millions of litres volume.
I reckon AIR should build their own strategic petroleum reserve if it ever gets that low again :) But seriously it must be tempting to lock in a long way forward at these prices but I know they have tight disciplines around forward cover so in reality these are unlikely to change...they don't want to be oil price speculators but back themselves to adapt to changing market conditions so the story goes straight from the horses mouth at last year's ASM.

[sb9]

Recovered all of lost ground from this morning, some nervous nellies I think.

[janner]

Flew into Tokyo yesterday.. Air NZ. It was less than half full.

Do not want too many of those flights to stay profitable ..

Check in was brilliant though..

A great system, very fast..

[brend]

Check in was brilliant though..

A great system, very fast..

I hate the self-checkin

Between Feb-May this year I have three trips to Shanghai and every time I required assistance to check in.

With the Visa requirements to enter China they have to manually check me in...

[Master98]

seems like AIR not yet announce annual result date, or do I miss the announcement? thanks in advance.

[Regi]

seems like AIR not yet announce annual result date, or do I miss the announcement? thanks in advance.

http://lmgtfy.com/?q=Air+New+Zealand+Key+Dates

26th August :)

[Master98]

http://lmgtfy.com/?q=Air+New+Zealand+Key+Dates

26th August :)
appreciate your help:t_up:

[winner69]

Not all AIR ex-customers happy

Probably has his its own private members lounge as well

But bob this a bit uncalled for - " but no airline, not even in the worst Soviet Union days, matches the infantile nappy-statism of an Auckland-Wellington Air New Zealand flight."

http://www.stuff.co.nz/business/luxury/70864065/sir-bob-jones-buys-private-jet-and-takes-aim-at-infantile-air-nz

[Beagle]

Bob Jones seems arrogant. There is no need for such a childish remark about AIR N.Z. who quite obviously offer the best quality service domestically.

One thing I do agree with, anyone with an ounce of common sense and an alleged $620m is stupid not to have done this many years ago.

Frankly I am not sure why he didn't buy a proper private jet. 640 km'hr cruising speed and limited intercontinental range doesn't really cut the mustard when you're worth a cool $600m does it ?. What's he planning to do on those long trips to Europe ?, stop four or five times for refuelling or fly a proper intercontinental aircraft :D

Message to bob, opps sorry Sir Robert Jones, if you're going to give our national airline "the bird" at least have the courage to buy a proper one first:p

[brend]

Clearly he didn't want to use Jetstar after the AIRNZ incident either.

[Beagle]

http://cessna.txtav.com/en/citation/mustang Only a 1200 nm range and 340 kt cruise speed. Can't even make it to Australia with a full load of passengers due to range limitations at maximum take-off weight lol

[tony64peter]

AR $530m plus I'm told

[Joshuatree]

http://cessna.txtav.com/en/citation/mustang Only a 1200 nm range and 340 kt cruise speed. Can't even make it to Australia with a full load of passengers due to range limitations at maximum take-off weight lol

Sounds perfect for fitting his fishing tackle in and slow trolling a fly on Lake Taupo, and knowing Bob is anti rules trolling up Tongariro River to boot.

[Regi]

Good bit of banter on this topic on Paul Henry this morning. If you're that rich and going to buy a plane go the whole way and get a gulf-stream. As Hillary Barry put it - he bought a Toyota Corolla of the skies [when he could afford the Jaaaaag].

[Beagle]

Sounds perfect for fitting his fishing tackle in and slow trolling a fly on Lake Taupo, and knowing Bob is anti rules trolling up Tongariro River to boot.

Yes but what our stroppy knighted friend doesn't mention is this little jet is single pilot rated with headroom of only 1.34m so how does bob swing a punch at people that annoy him when he's bent over like a 90 year old cripple lol

Sure was Regi - here's the Jaaaag http://www.aircraftcompare.com/helicopter-airplane/Gulfstream%20G650/164 Plenty of room for lots of attractive air hostesses too :D

[fiasco]

I have been travelling weekly (for the past two years) via Air NZ and to be honest, I enjoy the experience, Koru, the crew are generally polite and considerate. Sir Bob is being a pretentious pompous.

Aside from this slight distraction, looking forward to later this month, give me those Divi's!!

[Regi]

What's with the low volume trades today? Multiple "1" share trades taking place as well as a range from 1-18 shares.

[Poet]

Just visited the Seattle Boeing factory today. Spotted a black vertical stabiliser with Koru on it in the distance along the production line, must be close to delivery of another 787-9.

Impressive facility and impressive plane!

Happy to be a shareholder

[IAK]

Looking good.

Virgin is expected to be close to reaching after tax profit when its releases full financial year results Friday. Analysts forecast underlying pretax profit, which the airline industry sees as a good measure of performance, to be around $151 million

http://www.businessinsider.com.au/virgin-australia-is-on-its-way-to-profit-2015-8

[Joshuatree]

From The Bull,com au

Qantas looking cheap too ,P/E 7.79 Sector P/E 12.25 P/EG 0.22
2 year earning growth 55.6% forecast ;...

divi to be reinstated??

[Joshuatree]

Just visited the Seattle Boeing factory today. Spotted a black vertical stabiliser with Koru on it in the distance along the production line, must be close to delivery of another 787-9.

Impressive facility and impressive plane!

Happy to be a shareholder

Wow that would be an overwhelming exp Poet; the scale and size of it all would be mind boggling. Envious.;)

[Regi]

Jetstar Vs. Air NZ - Auckland University edition.

The past week in lectures, looking down at the sea of mac screens, I've counted 3 people booking flights on the Air NZ website which made me smile but today I saw something particularly satisfying. Person immediately in front of me was choosing between a Jet Star or an Air NZ flight, constantly alt tabbing and comparing the flights/routes/times etc. By the end of the lecture I saw she had booked a flight. With Air NZ :D Made me do a little cheer inside.

No real news but was a funny little thing to watch. Air wins again.

[Joshuatree]

Hi Regi are you in the black yet with AIR?.Correct me if I'm wrong but didn't you buy in in the $2.90s like some others.? If so i guess its conviction and patience leading up to good results.

[Cricketfan]

I have to admit, I nearly booked a Jetstar flight the other day, and the only reason I didn't was because my trip didn't go ahead. The flight was from Auckland to Dunedin, and although I usually book Air NZ, their cheapest price was $229 whereas Jetstar's was $79. The one and only time I flew Jetstar, the flight was delayed by 1.5 hours (not due to weather) and I swore I'd never fly them again, but with a price difference of that much I was willing to risk it.

[Regi]

Hi Regi are you in the black yet with AIR?.Correct me if I'm wrong but didn't you buy in in the $2.90s like some others.? If so i guess its conviction and patience leading up to good results.
I bought my initial and smallest parcel at $2.90 yep... still holding out for that to recover. But I also bought in when it was in $2.60's prior to the Jet star announcement and I also topped up at $2.40. Quite a spread but hold a decent amount now and am confident in recovering the $2.90 soon.

[Joshuatree]

Goodluck Regi, averaging up ,hope AIR takes off on FY earnings.

[brend]

https://docs.google.com/spreadsheets/d/1FH3Y2-vRUgojntPkCSJI5Pd-15rsJ1a0SFCRaT-iqgo/pub?single=true&gid=19&output=html

for those interested on expected AIR deliveries.

[Beagle]

https://docs.google.com/spreadsheets/d/1FH3Y2-vRUgojntPkCSJI5Pd-15rsJ1a0SFCRaT-iqgo/pub?single=true&gid=19&output=html

for those interested on expected AIR deliveries.

Wow, thanks mate. So they had 3 on hand last year, just took delivery of another one and then there's another one due 24 August and another on 28 October. Six of these super efficient new birds flying and sipping fuel at an incredibly slow rate and speaking of fuel, have you seen the latest price $43 bucks :t_up: As long as demand holds up with the slightly softer domestic economy, the cash registers will be ringing like crazy.

[Xerof]

Lol, They use Avgas not texas tea. $62/b for asia/oceania as at 31 july, but thats down 47.7% in last 12 months.

Global savings for Airline industry over past year on Avgas costs is USD81.6 billion - mind boggling stuff really. Have we had fare reductions? Not on your nelly, just like milk

[Beagle]

Crack spreads are coming down too. Love it. Keep those prices up AIR, about time people realised there's more to running an airline than pumping WTI crude straight into the wings...who would have thought lol.

[winner69]

Talking of Dreamliners here's a weekend read about Qantas finally getting some.

If nothing else shows how Qantas seem to dither around a lot over the years - unlike AIR eh

http://www.smh.com.au/business/aviation/will-plane-dreams-finally-become-reality-for-qantas-20150806-gispz3.html

[Beagle]

Talking of Dreamliners here's a weekend read about Qantas finally getting some.

If nothing else shows how Qantas seem to dither around a lot over the years - unlike AIR eh

http://www.smh.com.au/business/aviation/will-plane-dreams-finally-become-reality-for-qantas-20150806-gispz3.html

It would be a brilliant job being head procurement manager at AIR wouldn't it. Imagine the fun you'd have playing Airbus and Boeing off against each other and analysing the differences between the aircraft models, operating spec's and features. I'm picking they'd have a team of analysts working on that. Heck I'd do that job for free if I didn't need to earn a living. I think I missed my calling in life. I love analysing stuff to the finest degree. Some are content to hope they fly somewhere in the vague direction of north, others want to know the exact compass bearing and GPS position. We're all wired differently and diversity is a good thing eh mate.

Speaking of people who love to analyse things properly, where's our friend Mod ?

[Robomo]

Don't forget also, the latest two 787-9's for Air NZ are ex-development aircraft used in testing, for which they would have been given a hefty discount by Boeing.
What's the bet that AirNZ will eventually take up all their 787-9 options - another 6 I think - and start retiring the 777-200 aircraft (same PAX as the 787) from 2020 onwards? I believe that Chris Luxon mentioned some time ago that the -200's were still good value until then.

[Chinesekiwi]

Don't forget also, the latest two 787-9's for Air NZ are ex-development aircraft used in testing, for which they would have been given a hefty discount by Boeing.
What's the bet that AirNZ will eventually take up all their 787-9 options - another 6 I think - and start retiring the 777-200 aircraft (same PAX as the 787) from 2020 onwards? I believe that Chris Luxon mentioned some time ago that the -200's were still good value until then.

Yes - it's the airline's intention to retire the 200's from 2019 onwards.

[Beagle]

Don't forget also, the latest two 787-9's for Air NZ are ex-development aircraft used in testing, for which they would have been given a hefty discount by Boeing.
What's the bet that AirNZ will eventually take up all their 787-9 options - another 6 I think - and start retiring the 777-200 aircraft (same PAX as the 787) from 2020 onwards? I believe that Chris Luxon mentioned some time ago that the -200's were still good value until then.

18 in total looks a certainty to me. "Dream New Zealand" has a nice marketing feel about it doesn't it.

[couta1]

Well after spending a week in Q/Town tourism is absolutely going ballistic down there and with the best snow season for possibly the last 30 years ( According to a few locals) we are well positioned indeed, was nice to see all those Air NZ birds plus a couple of Virgin planes on the tarmac as we flew out with snow falling to boot:cool:

[ghostrider68]

The 200's carry a lot of freight where as the 787 doesn't. Air NZ used to make a lot of money from freight. What's the story there?Xerof, you mean avgas or avtur?

[Xerof]

The 200's carry a lot of freight where as the 787 doesn't. Air NZ used to make a lot of money from freight. What's the story there?Xerof, you mean avgas or avtur? I was using the term Avgas generically, as most readers would relate that to "fuel for aeroplanes" but Avtur works just as well for my example, (roughly same price)

[brend]

Air New Zealand Limited advises that its Annual Shareholders' Meeting will be
held in the Viaduct Events Centre. 161 Halsey Street, Auckland on Wednesday 7
October 2015 at 2.00pm.

how long would this run for ? 5pm 6pm / party all night....

[Traderx]

I was using the term Avgas generically, as most readers would relate that to "fuel for aeroplanes" but Avtur works just as well for my example, (roughly same price)

Good clarification, AIR would use very little or no "Avgas" but a vast amount of JET-A1 (or Avtur)

[WingingIt]

Im glad WLG->AKL flights this Saturday aren't too outrageously priced, $169, as won some tickets for the AB's via Barkers Coming home though...Crapstar won.

[Beagle]

Air New Zealand Limited advises that its Annual Shareholders' Meeting will be
held in the Viaduct Events Centre. 161 Halsey Street, Auckland on Wednesday 7
October 2015 at 2.00pm.

how long would this run for ? 5pm 6pm / party all night....

I look forward to seeing you there but would caution that their last ASM's refreshments were not conducive to partying all night. Either they have to lift there game or we make our own arrangements :D
On the freight thing, my understanding is the 787-9's that are replacing the 767-300's carry 15 tonnes vs only 5 tonnes for the 767's and that some of that 5 tonnes was subject to offload if the pax load was at max due to performance capabilities of the plane. Dreamliner's on the other hand can carry max pax and max freight.

[sb9]

Interesting headline...

http://www.cnbc.com/2015/08/11/opec-just-kicked-oil-into-the-30s.html

[KiwiGekko]

Interesting headline...

http://www.cnbc.com/2015/08/11/opec-just-kicked-oil-into-the-30s.html

Interesting times for commodity prices indeed. I will be watching to see how affects AIR but as a few have commented on this thread AIR's SP has not historically correlated to the ebbs and flows in the price of oil.

Good volume traded so far this morning, maybe we will clear $2.70 soon?

DISC: Holding.

[sb9]

Agree, there's no direct correlation between oil prices and air's sp.

Having said that, its interesting to note how the oil landscape is undergoing huge shift atm.

Good volume already through, think it'll break out of $2.70 today...