National carrier Air New Zealand on Tuesday reported a 1 percent fall in net profit.

The airline posted a net profit of NZ$D218 million (USD$153.5 million) for the year ended June 30, compared with NZD$221 million last year.

In May Air New Zealand said it expected operating profit to fall as much as 25 percent because of high fuel costs.

The company declared a final dividend of 3.5 cents per share, compared to 5 cents a share last year.

Air NZ shares, 77 percent owned by the New Zealand government, closed on Monday at NZD$1.22. So far this year the stock has fallen 36 percent, compared with a 17 percent drop for the benchmark NZSX-50 index.

The airline said normalized earnings before unusual items and taxation were NZD$197 million, down 24 percent on last year.

The airline dominates the domestic markets, where it competes with Australian airlines Virgin Blue and Qantas Airways on main routes.