Air New Zealand said it expects to report an underlying loss before significant items of $120m for the 2020 financial year.

The company on March 9 suspended its previous earnings guidance for the 2020 financial year due to the significant uncertainty surrounding the duration, scale and impact of the Covid-19 pandemic.

"The New Zealand Government's recent move to alert level 1 has enabled the airline to slowly restart the domestic network, however revenue and earnings are significantly lower than expected prior to the outbreak of Covid-19," Air NZ said in a statement.

"As the company nears the end of its financial year on 30 June 2020, it is expecting to report an underlying loss before Other Significant Items and taxation of up to $120 million for the 2020 financial year."

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The $120m figure tells only part of the story.

The underlying earnings guidance excludes the impact of fluctuations in foreign currency rates for the month of June, as well as any fuel price changes for the remainder of the period, which are not expected to be material given the reduced level of flying.

In addition to the $120m underlying loss, a number of other significant items will impact the 2020 financial results, the company said.

Figures released by the airline in May showed that the airline was burning through cash.

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In a market update, the company said it would feel the impact of $85m-$105m from fuel hedging de-designation, aircraft impairment charges of $350m-$450m, and reorganisation costs of up to $160m in the full financial year.

At the time it had short-term liquidity of $640m, versus $1 billion prior to the outbreak.

Given the scale of the cash burn, the Government has stepped in to provide loan facilities of up to $900m to the airline.

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Thus far, Air New Zealand has not tapped into this option.

Last week, in response to media speculation, Air New Zealand said it was considering various funding options, including a potential capital raising.

Air NZ shares last traded at $1.65, more than the double its low of 80c reached in the middle of the Covid-19 crisis in March.