Small operating profit likely for Air N.Z.

Press, 2 September 1983, Page 3

Small operating profit likely for Air N.Z.

PA Auckland Air New Zealand was “on line” to make a small operating profit this financial year, said the chief executive, Mr Norman Geary, yesterday. In spite of big improvements on international services, an actual operating loss of $32.6 million was still the company’s main problem, he said. People should not think that a consolidated profit ($33 million in the last financial year) meant that the

airline was out of its financial troubles. Much of that profit resulted from the $4l million the airline made on the sale of its DCIO aircraft. Nevertheless, Mr Geary said, the airline had made as much recovery in one year as many major companies would hope to make in four. While the airlines of the International Air Transport Association had reported an increase of only 2 per cent in traffic last year, Air New Zealand had had an 11 per

cent increases. It had cut'its international losses twothirds, and had generated 18 per cent more revenue against cost increases of only 8 per cent. Mr Geary, who was addressing the Auckland Chamber of Commerce, said the thrust of the airline had been moved strongly towards consumerism and profit. “One might ask why this was not so previously,” he said. “The answer is that Air New Zealand was no different from other airlines

— it had enjoyed years of high growth, and this did not engender strong profit perception.” If the company made the predicted small operating profit this year, it would not be content, said Mr Geary, as the airline had to make profits which were commensurate with investment.

Mr Geary said the emphasis for generating future business was being put most heavily on bringing overseas tourists to New Zealand.

The company had 372 people overseas and an annual expenditure of $3O million promoting the country.