AIR - Air NZ.

**Beagle** · 09-04-2019, 05:30 PM

Originally Posted by Beagle

Impressions from the call :-
Sounds like they have been having good dialogue with RR and direct cost impact this year will be about half the previously indicated $30-40m
Indirect RR impact costs running at about $20m per annum to be largely out of the business by Q1 FY20.
Capacity growth in FY20 towards the top end of the 3-5% range.
First 777-200 replacement due in 2023.
Focus on revenue per available seat kilometer strength (RASK)
Cost reduction focus is on top of existing plans to reduce CASK (cost per available seat kilometer)
Very minimal noticeable impact to forward bookings from Chch tragedy

Free wifi from today for enabled planes is a good thing.
I think the confidence within the business is strong and they are focused on executing well in this lower growth environment.
Capex deferral underwrites their ability to pay strong and sustainable dividends and get their gearing back to very moderate level's...(music to any dividend hounds ears).
https://www.marketscreener.com/AIR-N...07/financials/ I think we could see some modest upgrade to average analyst forecasts for FY20 and FY21 of $430m before tax.

A year is a long time in the aviation industry but I see fair value of ~ $2.75 a year from now and a gross yield of approx. 12.4% at the current share price of ~ $2.47.

Posted just 12 days ago against a barrage of negativism calling it under $2. Got the timing of the recovery a "little" wrong but I am not complaining lol

**allfromacell** · 09-04-2019, 05:45 PM

Well called Beagle, I'm surprised the SP is still going up even though oil is at five month highs.

**winner69** · 09-04-2019, 06:06 PM

Originally Posted by allfromacell

Well called Beagle, I'm surprised the SP is still going up even though oil is at five month highs.

Is what happens when you gave a slick preso with nice big numbers (rather nebulous one’s at that).

Market loves companies that save their way to respectability

Share price might be 3 bucks by Easter

**iceman** · 17-04-2019, 07:46 AM

Voted Australia's favourite company once again. LOL https://www.stuff.co.nz/business/inn...d-year-running

**winner69** · 23-04-2019, 04:13 PM

So AIR hiring expensive outside consultants
https://www.nzherald.co.nz/business/...ectid=12224620

Remember somebody posting this last year on another thread - “Hiring outside consultants a while back to tell them how to run their business was a free warning sign for shareholders that management have lost their way”

With fuel going up and now this warning sign maybe time to be cautious

**Beagle** · 23-04-2019, 04:19 PM

Yes, could be. From the other forum
In the last few weeks since management updated towards the end of March we have seen :-
1.Oil continue to march quite a bit higher, plus this further significant jump over the weekend
2. Rolls Royce engine problems on the Trent 1000 engine being announced on their latter version of that engine which could affect AIR beyond the currently understood period with earlier versions of that engine
3. The share price climb materially from about $2.40 before the last management briefing
I wouldn't have thought 3 goes with 1 and 2. Shares have reached my fair value assumption (exclusive of the first two factors mentioned above)

I have taken the appropriate portfolio action and still have a modest stake for yield.