Air NZ flies into turbulence as competition heats up

Air New Zealand reported a 24 percent fall in interim net profit Thursday amid increased competition in the domestic aviation market. New Zealand's flag carrier said net profit for the six months to December 31 was NZ$256 million (US$184 million), compared to a record NZ$338 million for the corresponding period a year previously. "The last six months saw unprecedented levels of international carriers adding new services to New Zealand," it said. "As expected, the change in the competitive landscape in a relatively short period of time has impacted on our airline's profitability." Operating revenue was down four percent to NZ$$2.22 billion even though the total number of passengers carried rose 5.6 percent to 5.2 million. The airline said a NZ$62 million gain from cheaper fuel prices was partially offset by a NZ$57 million loss on foreign exchange movements. It declared an interim net dividend of 10 cents. Air New Zealand shares rose 3.26 percent to NZ$2.22 after the announcement.