Air New Zealand (AIR) Investor Day summary

Strategic direction and market positioning

• Focus on maintaining and growing domestic market share, leveraging an 80% share and strong brand loyalty, while targeting premium leisure travelers for long-haul international routes to drive revenue growth.

• Premiumization strategy includes increasing premium seats by 30% by 2030 and introducing new products like Business Premier Luxe and Economy Skynest.

• Network strategy emphasizes diversified domestic and international growth, leveraging strong alliances and premium leisure positioning, expanding network reach to 320 destinations.

• Focus on premiumisation, ancillary revenue, and loyalty expansion to drive earnings growth, supported by disciplined cost control.

• Digital transformation is a core pillar, with 93% of infrastructure now cloud-based and a focus on AI, data analytics, and customer self-service.

Financial guidance and capital management

• Medium-term targets include 4%-6% annual revenue growth, with 3%-4% from capacity and 1%-2% from premiumization, ancillary, and loyalty initiatives.

• Committed to flat nominal or declining real CASK over the next three years, despite inflation and rising aeronautical charges, with cost transformation and scale efficiencies to maintain flat nominal unit cost by 2028.

• Investment-grade credit rating maintained, with liquidity at NZD 1.45 billion and low leverage, Net Debt/EBITDA at 0.8x in FY24, below the 1.5x–2.5x target range.

• CapEx to average NZD 850 million per year through 2029, covering aircraft, retrofits, digital, and cargo infrastructure.

• Ordinary dividend payout ratio targeted at 40–70% of underlying NPAT, with buybacks considered for excess capital.

Operational and business transformation

• NZD 300 million–NZD 400 million in transformation benefits targeted by 2028, including labor efficiencies, digitalization, and process simplification.

• Digital initiatives have reduced contact center calls by over 60% and improved on-time performance through tools like Ops Collab.

• Loyalty program replatformed, aiming for NZD 40 million–NZD 60 million incremental EBITDA by FY2028, with new earn and redemption options and expanded partner network.

• Ancillary revenue targeted to grow at ~10% CAGR, aiming for up to $250 million by 2028.

• Cargo business undergoing end-to-end digital transformation, targeting 20% revenue growth to reach NZD 500 million by 2028.