Air New Zealand Half-Year Net Up 154 Percent

Air New Zealand said growing numbers of tourists combined with a sharp drop in fuel costs lifted it to a record first-half profit, leaving the airline on course for best-ever annual earnings as it reaps the benefit of new global routes.

Citing record tourism inflows into New Zealand and a 44 percent drop in jet fuel prices, the airline said net profit more than doubled in the six months ended December 31 to NZD$338 million (USD$225 million). Operating revenue rose 12.3 percent to NZD$2.698 billion.

The profit surge comes as other global carriers reap the benefit of lower oil prices after years of seeing profit dented by high operating costs and stiff competition. Australia's Qantas also posted record profits this week as the lower oil price shrank its biggest single overhead.

"If we deliver the outlook we announced, it will be a very big record year," chief executive Christopher Luxon said in an interview after the company said it now expects earnings before tax for the full year of more than NZD$800 million.

He said the carrier would continue to expand, launching flights to destinations such as Vietnam after increasing routes to the United States, Argentina and China in 2015.

Luxon played down the role played by lower fuel costs in the airline's earnings.

"It's driven by our revenue performance which is really about our growth and ability to attract increasing numbers," Luxon said. "Tourism is on fire."

Statistics New Zealand reported separately on Thursday that visitor arrivals grew to a record 3.17 million in the 12 months to end-January, up 11 percent from a year earlier. According to Luxon, Air New Zealand brings 40 percent of those tourists to the country.