Jetstar nibbles into Air NZ’s domestic dominance
Jetstar, the discount unit of Australian airline Qantas Airways, made a small inroad into Air New Zealand's control of New Zealand domestic routes, boosting passenger numbers and nabbing market share.
The discount airline held about 22.4 percent of New Zealand's domestic market as at June 30, up from 20.6 percent a year earlier, Qantas said today when releasing its annual results. The number of New Zealand domestic passengers on Jetstar rose 17 percent to 1.87 million in the 12 months ended June 30, and the airline improved its revenue passenger kilometres (RPK) by 18 percent to 1,205 million. The airline's domestic New Zealand capacity rose 14 percent.
Qantas didn't break out any financial figures for the domestic New Zealand service, which are part of the wider Jetstar segment. The Australian discount airline lifted annual revenue 7 percent to A$3.29 billion, and contributed underlying earnings before interest and tax of A$138 million.
As a whole, Qantas reported underlying EBIT of A$372 million, on sales of A$15.9 billion. The airline returned to profit with A$17 million, from a loss of A$349 million a year earlier.
Shares in Qantas jumped 11 percent to A$1.365 on the ASX today, having dropped 17 percent this year.
The results came out the same day as Air New Zealand, which reported a more than doubling in net profit to $182 million on sales of $4.6 billion. The local airline's yield on its largest domestic service fell 5.3 percent to 27.2 cents per RPK even as passenger numbers grew 2.3 percent to 8.69 million and the airline was forced to offer cheaper fares to stimulate demand.
Air NZ shares climbed 3.7 percent to $1.42 on the NZX, and have advanced 5.8 percent this year.