Table of Contents
What changed
Revenue rose 6.7% to $6,752m, but every line below it went the other way. Operating earnings (EBITDA on the statutory label) fell 26.8% to $941m, PBT dropped 61.3% to $222m and NPAT fell 64.6% to $146m. Operating cash flow was the most striking move, down 56.3% to $810m from $1,853m, while capex rose to $791m from $602m. Cash on balance sheet fell $948m to $1,279m and, even with gross borrowings down to $1,393m (from $1,678m), the group flipped from roughly $549m of net cash to approximately $114m of net debt. The declared final dividend of 1.5cps compares to a 6.0cps final in FY23, consistent with total FY24 ordinary dividends of 3.5cps (including the 2.0cps interim) versus a materially higher prior-period payout.
What matters
- Earnings deterioration is real, not tax-driven. PBT fell 61.3% while NPAT fell 64.6%, a gap explained by the effective tax rate rising to 34.2% from 28.2%. No discontinued operation was disclosed, so the cleaner operating read is PBT down 61%, not a one-off tax artefact.
- Cash conversion collapsed. OCF/EBITDA dropped to 86.1% from 144.1%, and pre-lease free cash flow fell from $1,251m to just $19m as capex stepped up 31%. That is the swing that turned net cash into modest net debt in a single year.
- The second half carried almost none of the earnings. HY24 NPAT of $129m was 88.4% of full-year NPAT, implying just $17m of NPAT in 2H24 on $3,278m of implied 2H revenue. The revenue shape is roughly even (HY24 51.5% of FY24), so the weakness is margin, not seasonality.
Expectations
No FY25 target or forward-work metric was provided in the supplied materials. The only prior shape marker is the HY24 outlook for FY24 NPAT of $200m–$240m including $20m of specified items; actual FY24 NPAT of $146m landed well below that range, so the year under-delivered against management's own mid-year framing. Nothing in the release, as extracted, re-anchors expectations for FY25 margins, capex cadence or dividend policy.
Quality of result
Quality is weak on multiple dimensions. Revenue growth is genuine but did not translate into earnings: EBITDA margin compressed from roughly 20.3% to 13.9% of revenue. The cash result is worse than the P&L suggests – pre-lease FCF of $19m covers only 13% of reported NPAT, versus 303% in FY23, and capex intensity rose to 11.7% of revenue from 9.5%. The 1.5cps final dividend is not covered by pre-lease free cash flow on current-year economics (payout vs pre-lease FCF 267.9%); it is being funded out of the prior-year cash stockpile, which also explains the $948m cash drawdown. ROE fell to 7.1% from 21.9%. Very little of the FY24 shortfall looks timing-driven; it reads as genuine operating margin erosion compounded by a step-up in investment.
Unresolved
- No FY24 segment split was extracted, so the geography of the margin decline (domestic New Zealand, long-haul America, Tasman/Pacific) cannot be attributed from this data.
- The release references operating earnings "excluding items below" but no reconciliation bridge to statutory PBT was supplied, leaving the size and nature of below-the-line items opaque.
- There is no disclosure of FY25 capex plan, fleet cost pressures, fuel/FX hedge positions, or any dividend-policy recalibration to accompany the 75% cut in the final dividend.
- The effective tax rate jump from 28.2% to 34.2% is not explained in the excerpts provided.
This briefing cannot assess unit economics (yield, load factor, CASK) or FY25 demand/cost trajectory because no operating KPIs or forward guidance were included in the supplied materials.
Key metrics
| Metric | FY24 | FY23 | Change |
|---|---|---|---|
| Revenue | $6.8m | $6.3m | +6.7% ↑ |
| EBITDA | $0.9m | $1.3m | -26.8% ↓ |
| Net profit after tax | $0.1m | $0.4m | -64.6% ↓ |
| Net cash inflow from operating activities | $0.8m | $1.9m | -56.3% ↓ |
| Final dividend per share | 1.5c | 55.0c | -97.3% ↓ |
| Operating profit | $0.2m | $0.6m | -61.9% ↓ |
| Profit before tax | $0.2m | $0.6m | -61.3% ↓ |
| Cash and cash equivalents | $1.3m | $2.2m | -42.6% ↓ |
| Total assets | $8.5m | $9.2m | -7.0% ↓ |
Reference: annolyse.ai/briefings/air-fy24
Segment breakdown
| Segment | Current revenue | Prior revenue | Current result | Mix shift |
|---|---|---|---|---|
| New Zealand | — | $3873m | — | n/a |
| Australia and Pacific Islands | — | $838m | — | n/a |
| Asia, United Kingdom and Europe | — | $710m | — | n/a |
| America | — | $909m | — | n/a |
Reference: annolyse.ai/briefings/air-fy24
Analytical metrics
| Metric | FY24 | FY23 | Context |
|---|---|---|---|
| PBT growth | -61.3% | — | cleaner earnings measure |
| Effective tax rate | 34.2% | 28.2% | — |
| OCF / EBITDA (cash conversion) | 86.1% | 144.1% | deteriorated |
| FCF pre-lease | $19.0m | $1251.0m | −$1232.0m |
| FCF / NPAT | 13.0% | 303.4% | complementary conversion metric |
| Capex % revenue | 11.7% | 9.5% | — |
| Capex | −$0.8m | −$602.0m | +$601.2m |
| Inventory days | 7.1 | 6.9 | +0.2 days |
| Trade debtors | $0.0m | $7.0m | −$7.0m |
| Debtor days | 0.4 | 0.4 | +0.0 days |
| Net debt | $114.0m | −$549.0m | +$663.0m |
| Net debt / EBITDA | 0.10x | -0.40x | Weakening |
| Gross borrowings | $1.4m | $1678.0m | −$1676.6m |
| Payout ratio vs NPAT | 34.9% | — | — |
| Payout ratio vs FCF pre-lease | 267.9% | — | not covered |
| ROE (annualised) | 7.1% | 21.9% | Weakening |
| HY24 share of FY24 revenue | 51.5% | — | Other half was 48.5% |
| HY24 share of FY24 NPAT | 88.4% | — | Other half was 11.6% |
| Profit from continuing operations | — | $412.0m | — |
Reference: annolyse.ai/briefings/air-fy24
This analysis was generated using Annolyse, an AI-powered tool that analyses NZX company announcements. The analysis is based on available company filings and standard Annolyse calculations. This is general information only and does not constitute financial advice. The analysis may contain errors. Always read the original company filings and consult a licensed financial adviser before making investment decisions.