Air New Zealand reported a 26 percent fall in full-year normalized earnings before tax to 145 million New Zealand dollars ($99 million) from NZ$197 million on Thursday, hurt by declining demand for travel in the wake of the global economic downturn.
Air New Zealand's bottom line net profit slumped 90 percent to just NZ$21 million for the year ended June 30, down from NZ$218 million a year ago, the 75 percent government-owned national carrier said in a statement.
Air New Zealand reported a profit before tax of NZ$7 million for the financial year. Analysts had forecast a profit for the company of NZ$65 million to NZ$113 million.
Chairman John Palmer said the result "positions Air New Zealand as one of the top airline performers globally, but it falls short of delivering shareholders an appropriate commercial return."
Operating revenue for the year was NZ$4.6 billion, down NZ$58 million, or 1.2 percent, on the same period last year, with passenger revenue down NZ$74 million on a 7.6 percent fall in demand.
That decrease was offset by a NZ$188 million positive foreign exchange impact due to the weaker New Zealand dollar, the airline said.
Excluding the favorable impact of the weakening New Zealand dollar, operating revenue fell 6.9 percent.
The airline carried 1.8 million passengers in the year to June 2009, down 9.8 percent from 2 million the prior year.
Air New Zealand CEO Rob Fyfe said the operating environment was likely to remain turbulent.
"Although there are some early indicators that the slump in travel demand may be showing signs of having bottomed out, it would be naive to think that there won't be bumps on the road to economic recovery," he said.
An unchanged final dividend of 3.5 New Zealand cents per share is to be paid.