Net profit fell to $382m from $463m. Earnings per share were 33.5 cents versus 40.8 cents in the prior period. Operating revenue slipped to $5.1 billion from $5.23b.
"This year Air New Zealand faced an unprecedented increase in the level of competition from some of the world's largest airlines and effectively rose to the challenge," said chief executive Christopher Luxon.
The bonus awarded by the board will go to Air New Zealand staff who do not have other incentive programmes as part of their employment agreement.
The board also declared final fully imputed dividend of 11 cents per share, an increase of 10 per cent on the prior year, bringing the full year declared ordinary dividends to 21 cents per share. The final dividend will be paid on September 18 to investors on record at the close of business on September 8.
Looking forward to the year ahead, the airline said it was optimistic about the overall market dynamics. Based on current market conditions and assuming an average jet fuel price of US$60 per barrel (which represents the average over the past two months), the airline is aiming to improve upon 2017 earnings, it said.
Harbour Asset Management portfolio manager Shane Solly said the share price fall could be because the profit forecast was below what some had expected.
Solly said the company appeared to have executed its growth strategy while managing competitive challenges.