AIR - Air NZ.

[mikeybycrikey]

I was a (much more naive) holder of AIR way back in the 90's and they used to give some sort of discounts to shareholders then. I can't remember what form they took (does anyone else remember?).

I can't say that I ever took advantage of the discounts back then and consquently feel that most shareholder benefits from AIR are going to be unevenly distributed and benefiting only a small number of holders: hence not worthwhile for the company or for me.

The only possible benefit that I might appreciate would be airpoints or maybe airpoints status, but at that point why not just pay cash.

[Beagle]

Possibly the IRD's rules regarding deemed dividends are an issue. Just pay out all the 25 cps per AIR share net proceeds from the sale of VAH as a fully imputed special divvy, plus 15 cps final divvy, hold the AIR annual meeting at the airport hanger, a good tour of their facilities in Auckland, nice food and nibbles and perhaps a pat or two of the airport beagle dogs then a flight right around the country on one of their new dreamliners like they did for the Koru care kids with full meal service....now wasn't that a nice little flight of fancy on a cold winters day

[Balance]

Possibly the IRD's rules regarding deemed dividends are an issue. Just pay out all the 25 cps per AIR share net proceeds from the sale of VAH as a fully imputed special divvy, plus 15 cps final divvy, hold the AIR annual meeting at the airport hanger, a good tour of their facilities in Auckland, nice food and nibbles and perhaps a pat or two of the airport beagle dogs then a flight right around the country on one of their new dreamliners like they did for the Koru care kids with full meal service....now wasn't that a nice little flight of fancy on a cold winters day

They may yet listen to you and do a draw of a few planeloads of Dreamliners to Ozzie?

[skid]

Ya all know I'm still annoyed at management regarding share sales just before the so called investor day but putting that aside you'd have to say on the face of it AIR's management team have done a good solid job this last year.
Firstly they're still on track to deliver an all time record profit, only some of which can be attributed to low fuel prices because clearly yields have been affected as other airlines have discounted.
Secondly they've cleaned up some ugly messes brought about by previous management / directors. Most importantly they've ostensibly extricated themselves from a woefully underperforming Virgin and perhaps almost as importantly have made the move towards eliminating a legal risk that has it roots over ten years ago with the cargo cartel case in America. Importantly despite a softer economy in the second half they've maintained aircraft loads very well at close to all time record level's and grown the airline strongly while doing so. The SP reaction given the facts of what's been achieved this last financial year looks like a pretty big over-reaction to me.

Of course the big question is how competition affects profitability in FY17 and beyond. Clearly the market is taking a dim view of this but I remain of the view that the overall size of the pie, (inbound and outbound travel is growing strongly) and the cheaper cost of travel with lower oil prices and more efficient planes provides a broadly supportive environment to fill the extra capacity announced to date by both AIR and other airlines coming here. I'm not expecting a bloodbath effect on profitability for FY17 from the extra competition and the company isn't either.

I think effectivly trading cum a very strong fully imputed final and special dividend the shares are a good hold at the current price.

P.S. Another achievement for FY16 was getting agreement regarding the repayment of the unsecured shareholder loan they had to advance VAH in March 2016, $A131m. By supporting the forthcoming cash issue, which admittedly will involve a $21.3m investment in VAH in regard to their remaining 2.5% stake, (I assume they still have the 2.5% stake but its anyone's guess as the SP of VAH has come in for a savage correction lately so maybe AIR have been selling part of that residual stake on market ?), they have put in place the process whereby they will be repaid that unsecured loan, so a net $A109.7m will be forthcoming once the VAH 1:1 cash issue is settled. I would venture to speculate that if they hadn't of supported VAH with that unsecured loan in March their chances of achieving a reasonable outcome in respect of the sale of their shares in VAH would have been materially compromised. Good solid work all round in my opinion. Check out the SP's of Delta, American airlines and QAN, AIR not the only one to cop a real beating in recent months !

AIR Directors / management could do better (hence my 7/10 score), by:-
1. Reviewing their restricted persons share trading policy in a manner I suggested earlier in this thread
2. Allowing all interested shareholders to attend future investor days so its actually an investor day not an institutional and analyst briefing day.
3. Considering a shareholder travel privilege card in much the same light as Comvita who give 20% discount on products through selected retail stores. It is well known that directors, management and staff all enjoy considerable travel perks even after they have left the employ of AIR, why not shareholders who are after all the owners of the company ? (This is an issue I will raise at the next annual meeting).

I think I mentioned before how cool that would be(discount for SHs)--but alas..I seriously dont think it will happen--that kind oif thinking is for customers--(to increase sales)--SHs get their payback if the airline does well.
I think most would agree things are very different now than a year ago--there is now lots of increased competition --but the bigger thing that stands out is management(who were bullet proof and could do no wrong,have made a series of decisions that have gone to the opposite end of the spectrum(a temporary blip?)
I think their business strategy needs to be looked at--If you are generally going to charge higher prices,you really need to back it up with something really good (and I dont think they have done that compared to other premium airlines)--what makes them the better choice?
I have just flown MAL to KL-BKK---I could choose my own seats well ahead of time(its like getting premium economy) they continually had snacks and drinks along aside from the meals.--I would be interested to hear how the AIR fight AKK-Viet Nam was to compare--I find that ''having to choose a fare for dep and return (AIR) a real pain (rather than a simple RT price) -has that feel that they are trying to squeeze extra dollars out of you--Just my opinion--so any one who has taken that fight AK-HCM--it would be good to have feedback.
Of course its been beaten to death --but spitting the dummy with Virgin 9giving up decision making power)was disastrous in a business sense---If it was arrogance,lets hope he learned his lesson.
Its not the sweet ride it was before (for most airlines) so company will have to be more on their game--We have opened the door to one of Chinas airlines(another price of spitting the dummy)
On the bright side tourism is still alive and well--but this recent scare shows that this could change.
Will the public put up with cramming the maximum amount of seats in a plane and then turning around and harping about how flash and premium your company is--after all,comfort is a cornerstone of any flight experience.
Now its time for some shrewd and good planning

[Raz]

Possibly the IRD's rules regarding deemed dividends are an issue. Just pay out all the 25 cps per AIR share net proceeds from the sale of VAH as a fully imputed special divvy, plus 15 cps final divvy, hold the AIR annual meeting at the airport hanger, a good tour of their facilities in Auckland, nice food and nibbles and perhaps a pat or two of the airport beagle dogs then a flight right around the country on one of their new dreamliners like they did for the Koru care kids with full meal service....now wasn't that a nice little flight of fancy on a cold winters day

I get its winter and you want a holiday:-) You can get cheap airfares with AIR you just have to have total flexibility with the rest of your life. IMHO aiming for that life style will be quicker than waiting on AIR to give anyone bar management any financial breaks:-)

[sb9]

First time in the last few weeks where the sp did not get sold down on the close. Could be sign the tax selling is indeed over.

Looks like strong bids coming through at current price level, hopefully the worst is over for now. Already 1mln+ shares traded through....

[Beagle]

They may yet listen to you and do a draw of a few planeloads of Dreamliners to Ozzie?

Probably best if I do what Raz says rather than holding my breath. Might even be able to afford it if the shares stop going down and they pay a decent special divvy....we live in hope.

[workingdad]

Looks like strong bids coming through at current price level, hopefully the worst is over for now. Already 1mln+ shares traded through....

My guess is there could be a few profit takers that came in at 2.025 range. I managed 10,000 shares at 2.035 and had a buy in for another 7000 at 2.065 which at the end of that day touched down to 2.07 and I missed out sadly.

Looking forward to a special divvy but worried if it doesn't happen a lot of holders might dump AIR and I reckon I would be one of them....

[see weed]

Hey Roger, Fighting for the good cause here for you. Got another 17,000 in last 2 days and am now in the green by $1,449.Up Up An Away In........

[Beagle]

Hey Roger, Fighting for the good cause here for you. Got another 17,000 in last 2 days and am now in the green by $1,449.Up Up An Away In........

Good on ya mate.