Air New Zealand Limited (AIZ.AX) Earnings Call Transcript & Summary

[Foreign Language] We're going to start today's meeting with a [Foreign Language] and a [Foreign Language].

[Foreign Language] That concludes the full part of our welcome today. I've just got a brief safety message. I'd just like to give you a quick safety briefing. The bathrooms are located at the stairs where you entered on your left or right. This is a smoke-free and vape-free event. In the event of emergency, please make your way to the nearest emergency exit, which are down the stairs from which you entered to the left and right. Please follow the instructions of the dressed staff. If you require any assistance at any time, please remain in your seat and one of our team will assist you. Thank you for your attention, and please enjoy our [indiscernible] [Foreign Language]. [Presentation]

I'd like to take the opportunity to welcome the Chair of Air New Zealand, Dame Therese Walsh.

[Foreign Language] Good afternoon, everyone, and welcome. And it's a pleasure to be here with you today in Tamaki Makaurau Auckland for our Annual Shareholders' Meeting. And we've got a lovely view out there today for you if you get sick of listening to me. And I am grateful for you -- for those of you who have joined us here in person as well as all of the folks online participating in that way today. At Air New Zealand, we are committed to making our meetings as accessible as possible regardless of where the physical location is. And we hope that our hybrid meeting will continue to support strong participation and engagement with our shareholders. I would like to remind you that our comments today will include certain forward-looking statements regarding our future expectations, which may differ from actual results. We ask that you read through that disclaimer carefully and in particular, the forward-looking cautionary statement provided here on Slide 2 of the presentation. Before we begin our formal proceedings today, I would like to introduce you to my fellow Air New Zealand Board members. From my far right, we have Neal Barclay, Laurissa Cooney and Dean Bracewell. And on my far left, we have Larry De Shon, and Larry is actually our U.S.-based Director, who is joining us here in person today from Florida. [Foreign Language]. Lovely to have you here, Larry. And then we have Alison Gerry, Claudia Batten; and our CEO, although not for too much longer, Greg Foran. And seated in the front row, we have Richard Thompson, our CFO, and Nick Hill Robert Schenker, our CDO and incoming CEO. We also have our General Counsel and Company Secretary, Jennifer Page; Chris Goddard from Bell Gully,there you are, [Foreign Language]. And we also have Jason Shozi from Deloitte, there we are there, from the company's auditor on behalf of the Auditor General today. We also have many other members of the Air New Zealand executive team here today and our share registrar, MUFG, Pension and Market Services present, and our Investor Relations team. Before we go any further today, I'd just like to take a moment to personally welcome Neal to the Board. [Foreign Language], Neal. Neal brings extensive experience in commercial leadership, sustainability and transformation. He has led large-scale cultural and operational change, championed customer-focused strategies and driven investment in renewable energy, experience that closely aligns with Air New Zealand's decarbonization and customer ambitions. I would also like to acknowledge our CEO, Greg Foran, as this will be his final Annual Shareholders Meeting at Air New Zealand. Greg has made an enormous contribution to the airline over the past 6 years. He joined just before the pandemic sent shock waves through the global aviation industry and has since guided us through COVID, the Auckland floods, Cyclone Gabriel and some of the most complex operating conditions we have ever faced. And through all of this, Greg has led with clarity, consistency and care. He's instilled discipline in how we operate, and he has set a clear path for our transformation, building a culture that continues to show up in the way we serve our customers. [Foreign Language], Greg. [Foreign Language] The result we announced last month and the resilience we've shown in getting there are very much a product of Greg's leadership. And Greg will remain with us through most of October playing an important role in supporting a smooth CEO transition through to Nikhil. On behalf of the Board, thank you for your unwavering commitment to all of us, and we wish you the very best for what comes next. [Foreign Language] And finally, I'd like to take a moment to formally introduce Nikhil Ravishankar, our current CEO, perhaps you'd like to stand up, and incoming CEO, who, as I mentioned, is seated right there are now standing in front of you. Thank you, Nikhil. Nikhil has developed a deeper understanding of the airline and the aviation industry. Since joining us in 2021, he has played a key role in strengthening our technology backbone, developed an industry-leading partnership with OpenAI and has been instrumental in advancing our loyalty program, digital infrastructure and customer proposition. Nikhil has already demonstrated strong and thoughtful leadership during his time with the airline, playing a pivotal role in the design and delivery of the Kia Mau strategy and helping to embed the transformation and initiatives that we are now driving that are now driving meaningful performance benefits across the business. We are thrilled to have made an internal CEO appointment for the next phase of our journey. For those of you joining us for some refreshments after the meeting, please take a moment to introduce yourself into meet Nikhil, that would be fantastic, as we get to that after the meeting. Now I'm going to turn to the formalities of this meeting. And I note based on the information that has been conveyed to me that there is a quorum of shareholders present, and I declare the meeting open. Notice of the meeting was circulated to all shareholders, and I will, therefore, take it as read. We will discuss the resolutions later in the meeting, but please note, only shareholders, proxy holders or shareholder company representatives may vote. For those of you who are joining us online today, you will be able to vote and ask questions during the meeting. Please refer to the virtual Annual General Meeting online guide, which is available on both the NZX website and our customer our -- sorry, our investors into website and that will give you specific instructions. If at any time during the meeting, you need any further assistance, please call the MUFG Pension and Market Services helpline on the 0 800 number, which is now highlighted on the slide behind me. The order of events for today's meeting will be as follows: I'm going to comment briefly on the 2025 performance for the 2025 financial year on our company's performance and on the broader environment in which we are operating. I will also discuss the trading conditions we are currently observing early into the 2026 financial year. You will then hear from Greg Foran, our CEO. And following that, you will have an opportunity to ask questions related specifically to our 2025 financial performance. I will then move to the 2 formal resolutions of the meeting, which relate to the reelection of a director who retires by rotation today and the election of a new director. Voting on the resolutions will be conducted by way of poll. For those of you here with us in person, you will be able to cast your vote by filling out the voting card received at registration, which will be collected at the end of the meeting. You may also use your smartphone to vote. To do this, you will need to have registered with a PIN prior to entering the meeting. If you are a shareholder and did not register on arrival and still wish to vote, if you please make your way to the registration desk and staff from MUFG Pension and Market Services will assist you downstairs. For those attending the meeting online, you will be able to cast your vote using the electronic voting card that you received when you validated your registration. If you have any issues at all, please refer to the Virtual Annual General Meeting online guide that has been sent to shareholders. and, it can also be found on the main page of our Investor Center website. Following the voting, I will open the floor to any general questions you may have. When I call for questions, can shareholders present in the room please wait until the microphone is provided to you and clearly state your name before asking the question. I will take questions from those present in person first before moving on to any questions from shareholders online. We have also received some questions from shareholders prior to the meeting, which we will address during the session also. Immediately after the conclusion of the meeting, we invite all shareholders who are attending in person to join the Board and members of our executive team for refreshments out in the foyer. So as we take a moment to reflect on the past year, I want to start by acknowledging the strength and determination of the Air New Zealand team. 2025 was a year that asked a lot from the Air New Zealand Farno, a year that demanded focus, resilience and care. In time and time again, our people delivered. Through persistent disruption, they remained committed to our customers, to each other and to the success of the airline. I want to sincerely thank each and every one of them for their efforts. [Foreign Language] 2025 tested us operationally, commercially and strategically, but it was also a year where we saw just how capable the airline is when the pressure is on. Despite significant engine availability constraints and softer domestic demand, we delivered a result at the upper end of our guidance range, returned capital to shareholders and made real headway on the transformation initiatives and our infrastructure investments that will shape our long-term performance. For the year ended 30 June 2025, we delivered earnings before taxation of $189 million and a net profit after tax of $126 million. That is a result we are proud of, especially in light of the challenges we faced. It speaks to the underlying strength of the business, the careful focused decisions made by our executive team and the determination of our people to keep delivering in the face of disruption. Engine availability remained our most significant operational constraints. And at times, they were up to 11 aircraft grounded, representing around 20% of our jet fleet. That put pressure on our network, added cost and complexity and impacted our ability to deliver the scale of flying we had planned. Now while we received $129 million in compensation from engine manufacturers, only $107 million of that relates to the 2025 financial year. And this is significantly less than the $280 million to $320 million we think these issues cost us. As such, we estimate earnings before taxation of $185 million could have been approximately $165 million higher had the fleet operated as intended. Demand on the domestic network remains subdued, particularly in the corporate and government segments. That softness added further pressure to an already disrupted year. Inflationary pressure also continued to weigh heavily on the business. Nonfuel operating costs rose around 6% to $235 million, driven by compounding structural increases in areas like airport landing charges, levies and engineering inputs. These are not one-off impacts. They are system-wide and, in many cases, nonnegotiable. We are actively managing this pressure, investing in automation and tooling to look productivity, holding fixed costs stable as the network grows and ensuring we have the levers in place to protect performance. But there were bright spots, too. We saw meaningful gains in digital tooling, operational resilience and customer experience, which Greg will speak to shortly. Importantly, in a year where commercial aviation was again reminded of the importance of robust safety systems, Air New Zealand was recognized as the world's safest airline. That is not a title that we take lightly. It reflects the mindset, systems and the discipline that runs through every part of our operation. On behalf of the Board, I want to thank Greg and the team for the way they continue to prioritize the critical -- this critical Mahi embedded across the business. We also reiterated our sustainability commitments, releasing our first 2030 emissions guidance, a new, more transparent framework. It reflects both the practical steps we're taking now and some of the real-world challenges that are involved in decarbonizing the aviation sector. And although we operate at a smaller network than we planned with capacity down 4% for the year, we still carried more than 16 million customers and made the network work harder and smarter. We connected New Zealanders and visitors to 20 domestic ports with over 380 flights a day across the motu. As we speak here today, there will be more than 50 Air New Zealand aircraft in the sky. I can't see any right now, but they are up there, flying to and from over 48 destinations across the country, the Tasman, the Pacific Islands, Asia and North America. And it's before you factor in the reach of our joint venture partners around the world. Even in a year of disruption, we have kept doing what we do best, connecting people, places and possibilities. And even as we navigated the disruption, we continue to make choices that preserve and strengthen our long-term position. Our balance sheet remains robust with liquidity of $1.7 billion and net debt-to-EBITDA of just 1.1x. That is stronger than our target range. In July, Moody's reaffirmed our investment-grade credit rating of Baa1, which places us amongst the highest-rated airlines in the world. This financial strength allows us to keep investing in the future, whether that's retrofitting our Dreamliner fleet, delivering new digital capability for our people and customers, or building infrastructure like the new engineering hanger at Auckland Airport. These are not short-term projects. They're part of a long-term strategy that we continue to believe in and that is already delivering results. It allows us to return capital to you, our shareholders. The Board was pleased this year to declare dividends of $0.025 per share for our shareholders. Additionally, we returned almost $40 million to shareholders under the on-market buyback we announced in February as a signal of our confidence in the fundamentals of the airline and our commitment to disciplined capital management. I just want to close this section out by briefly discussing the 2026 outlook statement. Greg will provide some more additional detail on compensation shortly, but the outcome and timing of compensation discussions with engine manufacturers does remain uncertain. It makes it challenging for the airline to provide earnings guidance for the 2026 financial year. In the near term, that uncertainty, combined with sharp recent increases in aviation sector levies and other charges all set against the backdrop of subdued domestic demand, is expected to adversely impact the airline's financial performance in the first half. As such, the airline expects earnings before taxation for the first half of the 2026 financial year to be similar or less than that reported in the second half of the 2025 financial year, which was $34 million. We are well positioned for recovery when the engine challenges and economic conditions start to alleviate, but these issues continue to have a significant impact on current financial performance. To close, I want to leave you with this. The challenges we face today are not permanent. With our leadership, a clear strategy and an unwavering focus on customers, I believe Air New Zealand is well placed to emerge from this period stronger, smarter and better connected to the things that matter most. I'm incredibly proud of the commitment and resilience shown across this airline this year. And on behalf of the Board, I want to thank every member of the New Zealand whanau. Your dedication continues to set us apart. I also want to thank my fellow directors and you, our shareholders, for your ongoing support and belief in our future. I'd now like to offer a few brief remarks on my reelection nomination before handing over to Greg. So this year marks the conclusion of my second term is the Chair of Air New Zealand. And I stand here today to seek reelection for my final term as Chair and as a director on the Board of Air New Zealand. It has been and it remains an enormous privilege to serve in this role. Since I stepped into the role in 2019, I've had the opportunity to help guide the airline through one of the most complex and challenging periods in its history and one of the most difficult challenges in aviation history. From the extraordinary uncertainty of COVID-19 to the recovery period and the challenges of today's operating environment, it hasn't always been easy, but it has been incredibly rewarding. And I've been proud to stand alongside a team that continues to deliver under pressure and remains focused on setting Air New Zealand up for long-term success. For those of you who I haven't had the pleasure to meet, I'm a Wellington-based director, which sees me on our network often and gives me the chance to stay closely connected with our crew, our people and our customers. My background spans a number of areas, including external audit, global sports leadership and governance roles across private and public sectors. Alongside this role as Chair of Air New Zealand, I'm also currently serving as the Chair of ASB Bank. I'm also a Director of Ambien Bold Limited. I chair the Nominations Committee for the Climate Change Commission. And I am a member of the Frontier Independent Assessment panel. When I look ahead, as I head into this final term with your support, I just want you to know that the Board has been, for a number of years, progressing and forming up a governance succession plan to ensure that we have continuity and strong leadership as the airline moves forward. Following the CEO transition, we intend to appoint an additional director to our Board who holds deep aviation experience. The Board will then turn its attention to finalizing our Chair succession plans to allow for an orderly and well-managed transition towards the end of this, my final 3-year term with Air New Zealand. Air New Zealand is truly a special company. We hold a unique place in the lives of New Zealanders, and we play a critical role in our economy. I remain deeply committed to serving you, our shareholders. to supporting our people and continuing to guide the airline through this next chapter. And I humbly seek your support for my reelection today. [Foreign Language]. And with that, I would like to invite Greg to address the meeting for the very last time. [Foreign Language].

[Foreign Language] and good afternoon, everyone. Now you've heard Dame Therese describe 2025 as a year of progress despite disruption. And I'd agree with that. There's no sugarcoating the fact that this was a hard year, but we got on with it. I said that on results day, having 11 aircraft grounded at times due to maintenance, delays, et cetera, is a bit like playing a game of rugby with half your forward pack on the bench. It has knock-on effects across the network from schedules and productivity to customer experience and revenue. But we've made real progress in the areas that we can control. The transformation program we laid out at Investor Day last November, delivered around $100 million EBITDA benefits this year, and I'll come back to that shortly. At the same time, we've continued to lift our operational capability, improving the customer experience, strengthening our digital infrastructure and building more resilience into the operation. Four fully retrofitted Boeing 787s returned to service, each with modernized cabins and our new Business Premier Lux product. A new uniform was unveiled alongside the announcement of new routes. Key infrastructure projects remain on track and will support future fleet resilience. Our loyalty program continues to grow strongly with more than 5 million members. Plans for a new international lounge at Auckland Airport were also announced featuring expanded seating, elevated dining options and dedicated premium zones for our loyal customers. Across the network, we remain focused on reliability. Our on-time performance improved significantly in the second half of the year, up 6 percentage points. And that's the result of decisions that we made to put some more buffer into the schedule and more effective disrupt handling. And you can see that flow into customer sentiment with Net Promoter and in-flight experience scores stronger in the back half of the year. On the commercial side, our next-generation revenue management tools are giving us sharper insights and are helping us to both optimize yield and load which is especially important in a capacity-constrained environment. And on the digital side, we rolled out live chat, automated rebooking, functionality and other customer self-service tools, all of which have substantially reduced manual interventions, particularly at key pressure points like the contact center and airports. We also equipped 3,000 of our people this year with AI tooling and that's going to help our teams solve problems faster, lift productivity without adding much in the way of cost. There's more to do, but the momentum is encouraging. And it reflects a team that's continuing to deliver even when conditions are tough. This next slide gives you a sense of how we have navigated the year in what remains a highly constrained fleet environment. The second half was particularly challenging. In a point, we had up to 6 widebodies and 5 narrow-bodies grounded. And as a reminder, this is a position we were in despite the fact that we had around 20 leased engines in the fleet, 16 of which we didn't have or need prior to the global maintenance delays coming to light. Looking ahead, we don't expect a big step change in engine availability in the first half of FY '26, but pressure should start to ease from the second half as the first of our new 787s arrive, and we reach critical mass on retrofits returning to service. So yes, been a challenging year on the fleet front, but we've stayed on the front foot. We've kept our customers moving and made smart decisions in a tough environment. As more aircraft come back online, we'll start to unlock more scale, and that's important. At the same time, we've continued to invest in New Zealand's domestic network, adding new aircraft, improving operational efficiency and building partnerships to support regional access. But the cost of running a sustainable domestic network is rising quickly. And whilst we've absorbed much of that pressure to date, it's clear that the broader system needs to evolve if we are to protect access to affordable flying for all New Zealanders. I'd say the 2 questions I probably get asked most frequently from teams across the business, also shareholders media, and you name it is, how long is this going to last? And when will you be back to operating without this hanging over you? And the honest answer is we actually don't know for sure. This has proven to be much deeper and more persistent as an issue than we or, frankly, the engine manufacturers themselves expected as recently as 12 months ago or even at our Investor Day last November. We do continue to work closely with Rolls-Royce and Pratt & Whitney. Now compensation is a big part of those conversations. But getting a clear picture of when the engines return to service is just as important. That visibility is what allows us to plan properly. What we've laid out on this slide is our internal planning assumptions based on what we're seeing in the data and our operational experience to date. Now we're continuing to share this analysis with both Rolls-Royce and Pratts, and we're staying close to any update they can provide us with. As you can see, we're assuming no material improvement in grounded aircraft numbers for the next 12 months. And that applies both to the A321neo fleet and the Trent-powered 787s. And that's despite a significant list of actions we've undertaken and costs that we have borne to reduce the impact of those issues on our customers. You can see that we expect to start seeing a gradual recovery from FY '27 and in to '28, supported by the arrival of 2 new A321neos and 5 new 787s by the end of FY '28. What that means for us is low single-digit capacity growth in FY '26, followed by a more meaningful step-up in FY '27 and FY '28 as the engine constraints ease. We know that this isn't perfect. These charts won't be exactly right, but they reflect how we're currently thinking about things, and they're the best foundation we have right now. We hope the improvement will be better than this, but we have to plan for what we believe, not what we hope for. We delivered $100 million in benefits through our Kia Mau transformation program this year, in line with our expectations, and that's through a mix of revenue growth and cost efficiency. That includes stronger ancillary revenues from products like seat select and bags, cost savings from tools like Live Chat and automatic rebooking and a step-up in operational performance. Now while FY '25 was about proving that transformation can deliver in a disrupted environment, FY '26 and beyond is where it becomes a lever for earnings uplift as capacity slowly comes back online and we get more headroom to execute at pace. That's where the confidence comes from. The transformation program is delivering. It's scalable, and it's positioned to keep unlocking value over the next 3 years. So Kia Mau is working. It's helping to partially offset inflation. But more importantly, it's positioning us for incremental earnings growth as network scale returns. Now it's also worth spending a moment on the fleet because while much of the conversation this year has focused on the aircraft that aren't flying, we're equally focused on what comes next, and we're in pretty good shape. The retrofit program on our existing 787 fleet is progressing well with 4 aircraft already now back in service. Now once that wraps up, we'll move straight into upgrading the front end of our 777-300s, enhancing the customer experience while extending the life of these very capable widebodies. The only major fleet replacement program we have through to 2030 is for our new GE-powered 787s, and Boeing remains on track to deliver the first 2 of these in the current financial year. What this means is that by the end of 2027, the vast majority of our long-haul fleet will be flying with refreshed interiors, offering a more consistent, modern experience across the board. We're confident that wherever our customers are heading, they'll be enjoying a world-class product. We also remain optimistic about the long-haul growth over the medium term. That's why we recently exercised options to extend our 787 order from 8 to 10 aircraft, a decision that gives us headroom for growth and operational flexibility as we scale back up. Now these new aircraft will be more fuel efficient, more customer-friendly and give us the capacity to meet demand across key long-haul markets. And as more of our existing fleet returns to service, we will be well positioned to grow at pace and with the right tools and the right aircraft to do it. Now as Dame Therese has already outlined, our focus remains firmly on the long game. For me, that comes down to 3 things: Keeping control of what we can; backing our people and our customers; and making future-focused investments that will stand the test of time. Now this slide highlights where that investment is going over the next few years. We're prioritizing 3 main areas: Modernizing our fleet; strengthening core infrastructure, such as hangers and ground equipment; and building out digital capabilities. Each of these is essential to ensuring Air New Zealand is not just fit for today, but positioned to thrive well into the future. We know the near term won't be easy, but we're on the right track, and we've got a strategy that's already delivering. I couldn't be prouder of our people and the way they've shown up this year, and I want to thank them and you, our shareholders, for your continued support. [Foreign Language]

[Foreign Language] Thank you. Right. I would now like to open the meeting to any questions you may have that specifically pertain to the company's 2025 financial performance. If you have any general questions around the company and its performance, we can address those later in the meeting. So I just want to check if there are any questions around our financial performance in 2025. Are there any in the room? Okay. Thank you. Are there any online? Can I just check with the team? Sorry, there is one here. Thank you. Could we just have a microphone down here? Thank you.

Thank you. I'm currently a shareholder. As I look through your annual report online, and I have 2 questions. The first one is about the [indiscernible], which I happen to love, but not everybody does. I like the local uniforms. I hope that the fabric is good and hot and [indiscernible], but just because of its pure polyester, it may not be as comfortable as it should be. The designs look comfortable. Have your staff given you good feedback on whether the uniforms are comfortable in flight?

And look, thank you for your question. We can come back to the uniform in the general question section because we're just dealing with financials. But having said that, I'll just give you a little quick insight. There's been lots and lots and lots of testing with our staff to make sure that the design and the comfort of the fabrics are working for them. And I know people have different views on different colors. I totally understand. So we just do it in alignment with our brand.

Just one quick [ about purple ]

Yes, please.

Because you have the slides up people bathed in deep purple light retrofitted cabins. Now a warm light like those ones up there is probably easy on the eye going to a very [indiscernible] lighter than [indiscernible] I don't know about purple light in [indiscernible] The second question does definitely relate to financial.

Thank you.

I noticed that your airport partner is now Sharesies. Is -- on your airport partner, it's actually -- and I also noticed in your annual report that Ms. Gary is a Director on the Board of Sharesies. Now I regard Sharesies as a little bit speculative, not like crypto currency, but still a bit speculative. I just wonder if there's a conflict of interest there.

Thank you for your question. I'll just say that Alison's role with Sharesies has always been noted, and we've dealt with that in terms of our conflict management protocol around any discussions in relation to Sharesies. In relation to Sharesies itself, I wonder, Nikhil, if you wanted to perhaps mention quickly about the partnership with Sharesies. Thank you for your question.

I certainly can. I used to work with your son actually a long time ago, Lawrence.

Only in New Zealand.

Yes. So Sharesies is not the only loyalty partner. They are one of many loyalty partners we have. We work with -- and some of you might have credit card, for example, from ANZ, Westpac or AmEx and until quite recently, Kiwibank. So they're one of many partners we have on ground and on financial services. And Sharesies is a fintech business focused primarily on share trading, not crypto currency, that you're earning air points for your share trading activity on the platform. They also have term deposits and loan products and things like that, where they use Airpoints as a way of incenting people's activity on the platform itself. And it's very similar to the work we do with the other banks that we work with. So sort of a bit of an insight into what's -- what the partnership's about.

Thank you. I appreciate the questions, and you're reading the annual report. That's fantastic. Thank you. Okay. Are there any other questions on the floor in relation to the financial performance? Yes. Thank you. Sue, over here. [Foreign Language]

I wasn't sure whether it's a question for now or the general. The question was around the logic behind paying unimputed dividends. Given that they're really an inefficient way of getting value back to shareholders, there's been otherwise, I'm sure we would have considered getting that.

Yes, yes.

I do note that your large competitor in Australia avoided paying any unimputed dividends until they had enough franking credits in their case, available to pay out. And I wondered what the difference was between the 2 airlines. And other than having a large stake holding by the New Zealand government, which seem to be the only difference, and they would appear to be the only beneficiaries of having such a policy whereby they get their dividend plus 28% of everybody else's. So I just want to know whether you run through the logic of paying unimputed dividends versus all the other alternatives that might have been open to the Board.

Yes, we have. And I'm going to make a couple of opening comments and then pass to our Chief Financial Officer, Richard Thompson, who's down on the front row of there's a microphone available. And I think you'll find that we have historically paid dividend -- imputed dividends. I think there have been some changes in that regard, and we have thought through the options as it relates to how COVID has impacted our performance, our tax position, et cetera. But perhaps, Richard, if you'd like to give a bit more color. Thank you.

It's a very good question, and I started my career as a tax person. So I know it is a somewhat inefficient way of paying dividends without franking credits. We've given it a lot of thought. The competitor airline that you're comparing us to run big buy break programs. Buybacks are not an appropriate way of distributing sort of retained earnings or at least the tax department wouldn't think that's an appropriate way of distributing retained earnings out. We have 2 things happening in the business at the moment. We do have a dividend policy. It is a function of 12-month rolling NPAT. We apply that dividend policy, which has been in place for a couple of years without fear or favor. I would acknowledge, we would acknowledge that paying dividends without imputation credits is a somewhat an efficient way of getting distributions to shareholders. But at this line for so long as we don't have imputation credits that remains in line with our policy. It's certainly not motivated in any way, shape or form by the composition of the share register currently. As it so happens, we are running at the same time a share buyback program at the moment, which is more directly linked to our capital management framework where we're working to an earnings-to-debt metric and a liquidity metric, which has allowed us over the last year or so, given the elevated level of liquidity to distribute funds or run a share buyback program. We're halfway through a $100 million program at the moment. So I acknowledge the point. It's not motivated by the composition of the register. We see value in paying dividends, particularly to retail shareholders in the current environment, whether or not they are imputed, and we are taking the opportunity to run buybacks where capital management of the business sort of deem that appropriate.

Excellent. Thank you very much. I'm just going to check if there are any further questions on the floor. No? I'll just go online then. And the question that has been submitted online is which routes are value-destructive today on fully loaded economics for FY '25? And what criteria trigger exit or frequency change? Discussion has been made around opening routes up to India after the codeshare announcement with India in March. Has this progress further as could be a significant forward opportunity? So look, we deliver our financial performance in a consolidated fashion. We don't provide individual route metrics or financial performance. They do change over time as well, depending on how we are managing our marketing and our capacity kind of loads. I think the thing to know is that we constantly review them as a Board and as an executive team to make sure that we're making good network and capacity decisions in the short, medium and long term. So we're thinking it through all the time. Obviously, you will perhaps have noticed that we were in India and this codeshare announcement, the potential Cohere announcement was made with India. That is still something that is in our planning. It hasn't been fully determined in terms of date, of commencement, et cetera. But we certainly see it as an incredibly valuable market for New Zealand and for Air New Zealand, both from a tourism and trade perspective. So it's very high on our list of potential destinations over the next few years as we receive new aircraft

Okay. Thank you. Are there any further questions on financial performance? Thank you. If not, we now come to the formal resolutions of the meeting. And the resolutions for consideration today may only be voted on by shareholders, proxy holders and shareholder company representatives. The matters to be voted on today are the reelection of 1 director being myself, who retires by rotation. The other matter to be voted on today is the election of Neal Barclay to the Board. Now Air New Zealand's constitution requires that directors are appointed by the Board and then bought to the Annual Shareholders Meeting to retire and be reelected at the next meeting. As already mentioned, voting on all the resolutions will be conducted today by poll. When you registered on arrival, you would have been given your shareholder voting card. If you are a shareholder and did not register on arrival and wish to vote, please make your way to the registration desk outside the room, and staff from MUFG Pension and Market Services will assist you. If you are both a shareholder and a proxy holder or a shareholder company representative or have more than 1 holding, you would have received a separate voting card for each holding. When you vote on the resolutions, please complete all voting cards given to you at registration. If you hold shares in joint names and all holders are here today, you will have received 1 voting card only for your holding. Shareholders voting using their smartphone can swipe left to follow and vote on the resolutions. If you require any assistance, one of the MUFG Pension and Market Services staff can assist you. The Company Secretary holds a record of the valid proxies and postal votes received. Before I put the resolutions to the meeting, you can see the results of the voting directions given to proxies and the postal votes at the bottom of the slide for transparency. We will discuss and vote on each resolution in turn, and MUFG Pension and Market Services will tally the votes at the end of the meeting. Since the first resolution relates to my reelection as a director, I will now hand over to Alison Gerry, who is our Chair of the Audit and Risk Committee. She will now Chair the meeting for this resolution. And you've already heard from me earlier in my speech around seeking your support for my reelection. [Foreign Language].

Thank you, Dame Therese. Both directors standing today are strongly recommended by the Board and have been confirmed by the Board to be independent directors. Dame Therese was appointed as an Independent Nonexecutive Director of Air New Zealand in 2016, becoming Chair in 2019. She is a fellow of the Institute of Chartered Accountants and became a Dame Companion of the New Zealand Order of Merit in June 2015. Further credentials of Dame Therese are detailed in your notice of meeting. I move that Dame Therese is reelected as a Director of the company. Is there any discussion from the floor, first of all, and then we'll go to online. Okay. Can we just check, Kim, if there any questions online?

There are. The first question is, airlines are heavily regulated and reliant on government support, and it is unprecedented globally for an airline CEO to rise to become Prime Minister of a sovereign country. Could the Chair please comment on the extent of her engagement with Christopher Luxon since he became Prime Minister? Does he take a special interest in our company? For instance, was he consulted during the recent CEO selection process? And has he personally expressed his support for the Chair's reelection today?

Okay. I'll just let Dame Therese answer that question.

Thank you. It's working. It's working. Yes. Great. Thank you. Yes. So the airline in New Zealand is obviously 51% owned by the government. And yes, our former CEO is now the Prime Minister of the country. The Prime Minister is somebody that we have very regular engagement with. He's just, in the last couple of weeks, attended a couple of functions for Air New Zealand, as he does for most businesses, large businesses running events around the country. He unveiled a plaque the other day at the opening of our new hangar at Auckland Airport. I would say that he does take a special interest in our company, but he takes a special interest in all large companies. He does come from corporate New Zealand, and he's very engaged in what's happening in the business community. He was not consulted during the recent CEO process. He was informed of the decision, as per everybody else in the room on the day that it was announced, which I can't remember now, Nikhil, but you will remember. And he has not personally expressed his support for my reelection today because it's not his place to do so. It is the Minister of Finance, the Honorable Nicola Willis' job as shareholding minister, to decide about the Crown support for my reelection, which they have provided.

Thank you. Are there any further questions online?

No further questions have been received.

Great. Thank you. So on your voting form under resolution 1, to reelect Dame Therese Walsh, please tick either for, against or abstain. [Voting]

Thank you. I'm going to hand you back to Dame Therese to facilitate the remaining resolution.

Wonderful. Thanks, Ali. Our next resolution is in relation to the election of Neal Barclay as Director. As I mentioned, Neal brings extensive commercial, sustainability and leadership experience, having served most recently as the CEO of Meridian Energy, which is New Zealand's largest electricity generator and retailer. At Meridian, Neal held several senior leadership roles, including as CFO, General Manager of Wholesale and Generation and General Manager of Retail. I will now invite Neal to give you his comments in relation to his election. [Foreign Language].

[Foreign Language] Good afternoon, all you, shareholders. It is an absolute privilege to be invited to join the Air New Zealand Board. And today, I'm pleased to be here to seek your support to be appointed as an independent director going forward. I believe the person's motivations for any role are fundamentally important. And I'm a proud New Zealander, and I've chosen to work for businesses that make a real difference to our economy and our society here in Alderon New Zealand. As our nation's carrier, Air New Zealand plays a pivotal role in connecting Kiwis with each other and with the world. And I don't think that, that role can be overstated. And as a long-standing and very enthusiastic, I might add customer, I've always admired the airline's strong service culture. And the way I've always felt very genuine whenever onboard one of our planes, and I'm sure all of our customers experience that level of service. Now maintaining that service efforts, which I believe is world-leading and sets us apart as absolutely essential. But at the same time, we must continue to evolve our product offerings and maintain global leadership in both safety and quality. And I believe my experience will add strategic value to Air New Zealand. I bring a finance background as well as extensive executive leadership experience in infrastructure businesses where safety, government relations and capital discipline are paramount. And during this year, as Dame Therese mentioned, I stepped down as Chief Executive Officer of Meridian Energy, a company I joined in 2008 after leaving telecom. And Meridian is New Zealand's largest electricity generator retailer with a market cap of around $15 billion. And as such, it sits amongst the top 3 companies listed on the NZX. During my time as CEO of Meridian, we delivered shareholder returns, total shareholder returns that outperformed both the Australasian energy sector and the NZX. This experience has given me a clear understanding of how our Board can most effectively set direction and govern whilst also providing challenge and appropriate support for management. My career journey has also enabled me to lead an organization that became an exemplary of ESG practices and climate action. Now I remain convinced that doing business sustainably in the broadest sense is an absolute nonnegotiable for long-term business success. This presents an obvious challenge for the airline industry, but it's not one that Air New Zealand will shy away from. I also recently joined the Board of Chorus Limited in August 2024 and will join the Board of Nitahuo Holdings in January 2026. I believe both of those appointments complement my role at Air New Zealand and reflect my ongoing commitment to contribute to our country's long-term success. Now I'm confident that my skills work to the Board's existing capability. And with your support, I look forward to bringing my experience and expertise and a fresh perspective to the next stage of Air New Zealand's journey. Ultimately, our role is to deliver better outcomes for our customers and all New Zealanders and to continue to earn the trust and support of you, our shareholders. [Foreign Language]. Thank you.

[Foreign Language] Thank you. I moved that Neal Barclay is elected as a Director of the company. Can I just check in on the floor? Are there any questions in relation to Neal's appointment today? No? Are there any online questions. Please, Kim?

There is one.

Thank you.

Could new director, Neal Barclay, and the Chair comment on the recruitment process that led to his appointment to the Board? Was a headhunter involved? Did the full Board interview Neal? And did they interview other candidates? Did Neal know any of other current directors before engaging with the recruitment process? Also, what is Neal's view about the remuneration report voting on an annual basis as occurs in many jurisdictions, including Australia? Will he encourage a Board discussion on this issue?

Thank you. Well, I might take the -- at least certainly the first part. I might leave you with the middle part, Neal, and I'll pick up again on the last part of that question. So yes, there was an extensive recruitment process using an external recruitment agency used for Neal's appointment. The full Board did interview Neal, and we didn't have a full Board interview with any other candidates, but there were certainly other candidates considered by the Board. Neal, I know you and I have met a few times briefly before you joined the Board, probably a handful of times. I'm not sure if you want to comment on any other existing relationships you might have had with the Board.

I've bumped into a few of them in various events, but no, I didn't have any sort of deep or meaningful relationship with any of the existing directors. And my experience with you, Dame Therese, is basically have my arm twist to get Meridian to participate in the homeless women's trust support and [indiscernible]. So like everybody, [indiscernible] say no to very easily. So no, it's a new set of friendships and relationships that I'm developing with this Board, and I'm very, very pleased to be part of this, what I think is a very high-performing team.

Thank you, Neal. Just in terms of the last part of the question on remuneration reporting and creating a voting scenario with it. That is not something that's currently required in New Zealand. There are very few companies in New Zealand that actually do that. It's the first time it's ever been raised actually. And we're always trying to continue and improve our reporting. Our remuneration reporting gets more fulsome every year. So we'll take that on board. Thank you for the question. Are there any other questions come online?

No further questions.

Thank you. No further questions in the room? Okay. Thank you very much, everyone. If you could now please submit your vote by ticking either for, against or abstain on your voting form under resolution to elect Neal Barclay. Thank you. [Voting]

Okay. Have all who wished to vote done so? Everyone is okay? Excellent. Thank you. MUFG Pension and Market Services will now collect your voting cards -- sorry, they will collect your voting cards as you exit the room. And once all the cards are collected, they will count the votes. Shareholders participating via the virtual meeting website should now submit their votes. Voting will be open until the close of the meeting. The results will be announced to the NZX and the ASX after the conclusion of the week of the meeting. I'm now going to welcome you to sit back, relax and watch the following video, and then we'll get into general business before refreshments. [Foreign Language] [Presentation]

Right. I call the meeting back to order. As a reminder, the results of the poll will be made available on both the NZX and ASX after the meeting. I would now like to open today's meeting up to any other questions you may have. Can I please ask that we use this time to focus on questions relating to matters that are relevant to the airline. If you have any customer-related matters that you would like to address, please direct your comments to our Investor Relations team, who are down the back of the room there. Now let's -- perhaps if we go to questions on the floor first. How about that?

Great. Got one here and one over here. I think you've already got a microphone. So we'll go first here and then come to you, sir.

John Humor, shareholder. You've got $100 million to buy back the shares of Air New Zealand, and you've spent $50 million, I understand, so far. Why haven't you done that across the board instead of supporting the share price being the strongest buyer on the market, which you're probably paying more than you need to for your shares? And the second question is, is the government selling into this share buyback? Or are they just maintaining their 51%?

Good question. And I think we thought a lot about this share buyback situation. And of course, nothing is ever perfect. However, I think it was a really important signal from Air New Zealand in terms of the long-term value in the shares. What -- what's happened with the government as they have elected to keep their shareholding at exactly the same level at 51%. Well, just over 50%. They basically have a desire to be at least 50%. So there are some mechanisms to allow that to occur to ensure that the buyback doesn't dilute the Crown under the 50% watermark. Alison, as Chair of the Audit Committee, are there any further comments you'd like to make around our capital strategy.

Yes, I'd just like to say that the speed that we can undertake the buyback is very much linked to the market liquidity of Air New Zealand stock. So it will take us probably a 12-month period to reach our targets. We do think it's an important tool in our capital management framework. We've said that there are specific gearing targets that we would like to meet. And this also was a mechanism that we used to make sure that we can move towards our targets under our capital management framework.

Thank you. Sorry.

I'll give you 2 other companies that had share buybacks. Spark is one of them. They pay too much for their shares. The price is tanked. Bet your building did the same thing. Tower went across the board like I suggest to you. Their price has gone up amazingly. The 2 other ones which have done what you've been doing and their prices have tanked. So I think you got it around the wrong way.

Okay. Well, thank you very much for the feedback. We'll take it on board. And I'll just note that the share buyback is a relatively moderate percentage of what we could have done. So it is at all, as Alison says, within our capital management toolkit. But it is a reasonably modest amount. So -- but we note your comments. Thank you. Can I see if there are any other comments in the room? Got one here, I think. Kia ora?

Okay. My name is Shabir, a shareholder. I'm touching on the point of your main business about grounding of aircraft because of the engineering issues. Now you say first thing I would like to know, out of the 113 aircraft which we have, how many are leased, how many we are owned by us and lease the numbers? Secondly, I want to know that this particular thing is getting worse actually. As you see, earlier, we were having 7 to 8 aircrafts getting grounded because of the engineering defect, engineering, planning and all that, whatever it is. Now it is increasing to 10 and 12. So how is the management going to take care of these ongoing issues, which is escalating, according to me. It is not coming down. Secondly, I would like to know how many of these aircrafts have been grounded in New Zealand and how many have been grounded overseas? Thirdly, I would like to know if you are making any comparison? Now this engineering problem, is it only applicable to New Zealand aircraft? Or is it worldwide? And if other companies have been adjusting, how they have been adjusting and what are their actions, whether we can follow them? Fourthly, I would like to know -- sorry, it is our [indiscernible]. But I would like to know, what is the turnaround of our aircraft? Like how many hours it remains on the ground? And how many hours it is flying? And whether it is comparable with the world leaders like Singapore Airlines, Emirates and et cetera?

Kia ora. Thank you. There was a lot in there, and so I will break that up just a little bit. And firstly, I just want to say, thank you, we share your frustration with what is happening with our fleet through the engines, the engine shortages and the issues that we have around that. And there's significant work going on. And yes, you're right, it has been deteriorating. However, we can see where it's going to peak and hopefully come right over time. As Greg said, we're still not quite sure, and we're working as hard as we can with all of our engine partners to try and make that as good as possible. And I will ask Greg to make a few comments in a minute, but I just wanted to also add that this isn't just a New Zealand issue. It's that type of -- those type of engines. I would say we have been disproportionately impacted because we are a smaller airline relative to some around the world. And so the impact of having 2 types of engines with issues on our fleet has been disproportionate, very disappointingly so, but unfortunately, is the reality. And so it is very much a worldwide issue. So Greg, what I might ask you to do, please, is to just comment a little further on that. And then we will go to the airport turnaround times. And perhaps, Alex, you might like to comment on this in a few minutes. So Greg.

Sure. Thank you for the question. Richard, how many are leased and how many are owned?

Mostly owned.

Mostly owned. [indiscernible]

We'd be 80% -- 75%, 80% owned fleet.

So the turbo props are owned, and then the jets can be a combination of owned or leased. And the fleet is roughly sort of 55 jets and sort of 55 turbo props. So all the turbo props are owned, and then the lease is -- some of the jets are leased. In terms of the -- what are we doing about this? A lot, and we continue to do a lot. As recently as actually last night at Haas 10 down in Christchurch, Nikhil, Richard and I were deep in negotiation with the Chief Executive of Pratt & Whitney, who happened to be in town. Why were we in Christchurch? We have a joint venture down there with an engine center that repairs engines. So I would say to you that probably at least every week, I am involved personally in working through with the Chief Executive of Rolls-Royce and the Chief Executive of Pratt & Whitney. This is a global issue. However, it doesn't affect every airline. There are sort of about 3 people around the world that make engines for jets, Rolls-Royce, Pratt & Whitney and General Electric. And of those 3, let's say that there's roughly 18 variants of engines. So Rolls-Royce makes sort of 6 variants of engines. So that could be like a Toyota Corolla or a Toyota Camry; Pratt & Whitney makes 6 variants; and General Electric makes 6. Really, just by chance, we happen to have the 2 most problematic variants in the world at the moment. Now these decisions got made years ago, and I'm not casting dispersions on the decision-making process, but it just so happened that back in early 2000s, we made a decision to buy a Trent 1000 engine. It was being developed at that stage. And it was going to be a terrific engine, and it was going to be the most fuel efficient and the lightest and all those things. Well, it just so happens that, that particular variant has a problem with an engine -- a blade in the engine that cracks. Now they do have a solution for that, but it only got approved by the FAA about 3 months ago. So those engines now have to go to what they call a shop or a garage, and they all have to get broken down. There's probably somewhere between 35 to 40 planes in the world on the ground at the moment because of that particular issue. You won't find that information on the Internet or anywhere because Rolls-Royce do not disclose it. But some of the airlines that are affected are Virgin Atlantic; Singapore Airlines, through its discount subsidiary, Scoot; ANA in Japan; and ourselves. We have 5. I think there is probably another 2 years of pain with Rolls-Royce to get those engines through a shot, dismantled and reassembled. Rolls-Royce, at the same time, are making new engines with this new blade, and they are working flat out to get those engines on new planes. So you're competing with Rolls-Royce, who are making decisions about how many engines they want to repair that are -- need to get fixed and how many they can sell for a bigger profit to go on a new plane. Pratt & Whitney have 1,200 engines queued up to go through a shop. That is public information. Now some of our competitors don't have this problem. We do. It is hard, painful work. We are involving every single person that we can to assist us with this. And I'm involved, Rich is involved, Nikhil's involved, everyone in the business, to get what we can in terms of compensation. We don't get fully compensated. We probably get compensated for less than half of what it costs us. You can see that in our accounts. You can see that in other airlines like Wizz who are impacted, ANA that are impacted, these airlines are calling out the impact it has. Some airlines aren't impacted. United Airlines, I was talking to their Chief Executive 2 weeks ago, he has none of these engine variant. So he has no AIGs. They also have 1,500 jets. We have 55. So look, we're doing everything we can. We continue to work on that, and I'm happy to take any further questions you may have during the cup of tea.

Thank you. Thank you. And Alex, would you like to mention something about turnaround times?

Yes. I think from our perspective, across our entire operations team, we know the importance of aircraft availability. We know when the aircraft is flying is when we generate revenues. So we -- with all of the remaining aircraft, the non-parked aircraft, we have significantly increased the utilization of those fleets, even greater than what we had before COVID. So our widebody fleet will be 16 hours. It is an industry-leading benchmark, the number of hours of utilization of flying for our widebody fleet. For the Airbus fleet, we're at 11 and 12, again with industry benchmarking. So we have worked very hard, and that's some of the pressure sometimes that we see in the operation because we're doing everything possible to operate safely, airworthiness but keep those aircraft always flying.

Kia ora, Alex and Greg. And Larry has come from a strong airline background in the U.S., and he's found these conversations really interesting about these benchmarks and how we've been improving our turnaround performance. Okay. Other questions on the floor? Otherwise, I'll move online. Yes, we've got 2. So just over here and here. Thank you. Kia ora.

Yes, I'm Australian and I'm a shareholder. You're talking about the problems which you've had in the past with the engines and so on. It sounds as if you're a bit optimistic about the future. But what about the problems coming from climate change like jet fuel and [indiscernible]. What you're doing working at present with channel at Marsden Point? It would seem to me that there's some quite significant problems that are going to come from that.

Well, thank you for your question. And I think you're right. I mean this is a very complex and dynamic business. And so there are always issues and risks that the Board have to consider as well as the opportunities that are in front of us and the potential growth opportunities. And from a risk perspective, there are a number of risks on our register that are in the annual report, and you're absolutely right that sustainability and climate change, particularly, is right up there, and it is something that we spend a lot of time talking about and thinking about, and we've made a change to the metrics that we put out there at the moment. In terms of giving more transparency to how we think things that we can control or not control such as sustainable aviation fuel production that you mentioned are going to go. I don't personally know what's going to happen with the refinery, but I will just look at Kiri or Greg as to whether you had any additional comments to make in that regard.

Kiri can give us an update. We do have an update on that.

So Kiri is our -- thank you. Kiri is our Chief Sustainability Officer.

Thank you for your question. I guess, and to your point, under the Board's guidance the airline works to both deal with the short-term issues that we face, which have been well canvassed, but also to the long term, and we're very cognizant of the impact that climate change will have on our operation. In terms of channel, myself and Richard and their teams are looking at the opportunity up in Marsden because it does present some possibilities around fuel supply into Auckland, but a more sustainable type of fuel. So that's an opportunity for us, but also Air New Zealand and is some different opportunities for a more sustainable fuel for our aircraft throughout the world, but we're certainly very interested in what's happening in refinery.

Is it true that Boeing are actually having problems to climate change related because they've had to change the method of construction of the aircraft. Am I right that it's gone from an aluminum body or whatever to carbon fiber?

Look, I have not heard that. But interestingly, the Board and Nikhil and myself will actually be meeting Boeing in less than 2 weeks. But we're on track for delivery of our 2 Dreamliners. We can actually see them getting produced online at the moment in North Carolina. It's where they make them. So I'm not aware of issues specific to that in terms of the Dreamliners that we buy. But look at something we'll take on board and happy to have a discussion with their leadership in literally 2 weeks' time.

Thank you.

I think we have a question down here.

Thank you. I'm sorry, I'm coming back to purple again because it's right behind you. And what I'm wondering is, are the walls painted purple? Or is that the lighting?

It's the lighting. It's the lighting.

Look, I'm pretty sure it's the lighting. We don't paint the walls as sort of a different color than what the aircraft comes in. So there is lighting, which is controllable, I understand, in the aircraft. So I think we'll take your feedback on board, and it can be managed within the aircraft in terms of its intensity.

Your report on the slide, everything is deep purple. We don't love people, but I don't know that I'd like to be sitting in that environment. Color affects people's mood very differently. And it's always been accepted that you do something neutral and soft in the environment, then you can put colored things around to enhance it. But that is very purple, and I really suggest that you look for something. If that's your new retrofitted cabin, it is too purple for everybody's taste.

Okay. I think we'll take that on board in relation to the intensity. I agree. And I also acknowledge that you like the color of my jacket, and that you might prefer that. So we'll take that on board. Pink is a very calming color apparently.

It's calming.

Yes, calm and happy color. That's why I wore it today. So you're spot on. Actually, I might consult with you before next year's ASM. Thank you. I really appreciate that. Yes?

My name is Steve Bar. I was just wondering if you had any comments on electrification of aircraft? And specifically around regional aircraft, where is that currently progressing?

Yes. So a couple of things just to call out. Firstly, we have made a decision to keep our Q300 aircraft, which is the most -- it's 1 of the 2 types of aircraft that we've taken to some of our regional ports, including the ATR. So the Q300s, I don't think we've seen a final date, have we, Richard or Greg, but we'll certainly be using those well into the 2030s. They've got a lot more life left in them and we want to keep -- continually using those as very effective aircraft. In terms of electric aircraft themselves, we do have a commercial pilot happening next year, I think. Kiri, perhaps you want to give some feedback on that? So we are starting to be a bit of a leader -- just have a bit of a test with how this technology works and just get us our muscle going in relation to this. So no firm plans yet. But Kiri, do you want to just illuminate?

I'm sorry. Very exciting news that we have the first electric aircraft that New Zealand will fly with on the water now on its way over to New Zealand from the U.S. We've partnered with one of America's leading innovators in terms of next-generation aircraft, and we are going to be flying it under an American license actually in New Zealand with their pilots and ours from Hamilton starting in November. And it will be just a technical demonstrator. We won't be putting passengers or cargo on it. We're just trying test how it works in New Zealand and our system with our weather and to get our regulator comfortable for the possibility of different types of aircraft coming forward. So that will be here in New Zealand in November. And then towards 2028, we're hoping that we'll fly the same aircraft or the next iteration of it is a commercial demonstrator we're buying. And we put in the cargo or passengers in that. But we're keeping a close eye on what that looks like. For us in New Zealand, we're very lucky that we both have short distances to fly, so for regional flying, but also a very good grid to support renewable energy. So we've got our eye on it. It's not going as well sort of in terms of progress internationally as we perhaps thought it would a few years ago, it's a bit slower. But we're certainly -- we're trying to do our best to support the system. And we'll be really -- is it kind of develops.

Kia ora, Kiri. And that's why we have decided to extend the life of the Q300s for that very reason. So thank you. Any other questions before -- from the floor, and then I'll go online? Yes? So over here. Kia ora.

Thank you [indiscernible] shareholder. Just a quick question regarding going back to London. I gather you may not be able to tell us when, but are you able to tell us where we might be going through and hopefully, options other than LAX are being considered.

I'm going to give that to Nikhil to answer because he will be here, but we do feel pretty good about it. So over to you, Nikhil.

We're not ready to announce anything specific as yet is the short answer. We're looking at all options. L.A. is -- continues to be an option, and L.A. more recently have done a lot of work around transiting passenger journeys and experience. And if we do go down -- go through that port, we'll be taking advantage of some of those newer capabilities that they have there. But equally, Singapore is an option, and we're looking at Singapore, and that's a serious option too. And in terms of time frames, we're working through that. And one of the things that defines the time frames for us is the engine issues and availability. So as soon as we know, you'll know. Thank you.

Kia ora. I've got a number of questions online, but I just want to check if there's any more on the floor. Kia ora. Just over here. Thank you.

My name is Eva Quidding. Do you have any more information at this stage to share regarding the Mangopare pilot cadetship program for 2025?

Wonderful question. Thank you. Yes. Who would like to answer this question?

Nathan.

Kia ora, everyone. Thank you. It's a great question. So our Mangopare program, we've got just under 30 candidates, 20 are cadets and are offshore at the moment working in Arizona and learning to fly there. Simply that was our way to stand up that program as quickly as we could with a new training program and see if we can get that -- get momentum going really quickly. We would like to pull that program back onshore as quickly as possible back to New Zealand. And we're looking at options to stand that up now. That will take a little bit of time as we work with different providers around New Zealand, look at different options, but it's a wonderful program. I was there myself just a couple of weeks ago, meeting with the candidates and seeing what they're doing there. So we will continue that program. Any more openings? I actually couldn't speak to that next phase of recruitment just [ year ] into that program, but we've -- it certainly was incredibly well supported. We had a very large number of applications, and it was a tough process to choose.

We're very proud of the Mangopare pilot cadet program as an organization. Okay. I'm just checking for any additional questions before we hit online. Yes, sir?

Kevin Tate, shareholder.

Kia ora, Kevin.

Greg mentioned earlier that on-time departure was getting better in the last quarter than the quarter before. And I just wonder when it might be possible to travel between Auckland and Wellington with a reasonable degree of certainty that the flight would leave on time, other than maybe traveling on the same flight as your Chair is flying. But I recall some years ago, the flight time Auckland to Wellington was timetabled at 1 hour and then crept up to 1 hour 5, and I think it's now 1 hour 10. But it seems that you're still not able to get a reasonable chance of that actually happening. So I wonder whether we might see some improvement in that respect.

Thank you for your question. We are seeing improvement coming through coming through in our on-time performance metrics. And are you Wellington-based, I'm wondering?

I'm Auckland based. Wellington for many years.

I see. Okay. Well, I, myself, travel Auckland-Wellington most weeks actually. And I promise, they don't hold the plane for me if I'm late, and they don't make it on time just because I'm there. Unfortunately, networks don't work that way. So I would have to say my experience is that mostly we are on time. The on-time performance is certainly improving. And there have been so many things that have happened to increase that level. In terms of your question around the time or the duration of the flight, that does change on the day depending on the circumstances and the wind and the weather conditions, et cetera. I don't know if anyone wants to add anything to that. Larry, did you want to add anything?

Yes. I would just say that there is a real momentum building up now. To fix this problem, it wasn't a matter of just a quick training course or adding a few people here or there. It was a really strip it back down to the very basics and build it all back up again. So to really get long-lasting, sustained operating performance, we really had to think about what we were measuring. What are the real root causes of what's causing the delays, not the superficial causes, really digging down, might be equipment related, ground equipment related, it may be personnel, maybe training. There's -- it's a very, very complex business as you can possibly imagine. So to really get sustained operating performance that we can all be very, very proud of as a company, we had to strip this thing down to the very basics and kind of start over again. And that's what Alex and the team have been doing. There's been a tremendous amount of work being done on this. And I can say because I watch this very closely, and I look at the numbers every week. We are seeing sustained improvement. Yes, there'll be a really bad weather day that kind of sets us back, but I can tell you the recovery after that weather day is getting faster. So as you start to take a look at the -- all the different elements that put this together, we're seeing things improving, and we're seeing sustainability and the improvement. And I think this next year is the year that we're going to really be able to start seeing these metrics really perform well. There are some tough markets like Wellington. I mean I've been to Wellington a few times. Every time I go, it's like a wind force and rain sideways and cold. But we have to learn how to operate through those kinds of environments as well. So I take it on. The Board takes it on. We talk about it at every single Board meeting how we're doing.

Kia ora, Larry. You can't be Wellington on a good day. And you will know there are no weather incidents in Wellington that require a flight to be in a difficult position. Anyway, it's definitely improving, but thank you for your question. Any other questions before I hit online, because we've got a number of questions in the queue here online at the moment. Okay. I'm going to head online. Thank you. And the first question is, will Air New Zealand recover to the level before COVID and be a strong company again for New Zealand? Well, the answer is that we want this -- and sorry, what is the Board doing about this situation? So that we've canvassed a number of the issues already in our meeting this afternoon. I mean I think there's a number of different ways of looking at what level we were before COVID and where we are now. It's a number of passengers, number of aircraft number of flights, profitability, revenue, et cetera. There's a number of different ways of looking at it. And obviously, we are facing some challenges at the moment as we've been discussing on this meeting. I think from our perspective, we are really strongly doubling down on our plan. We are making sure that we are investing for the medium to the long term. We are working with government in terms of inspiring further tourism. We're working hard to get engines back on planes so we can support that tourism. So there's this kind of tough operational period, but we're gradually scaling up. And we are we will start to receive new widebody jets as well as some of the domestic jets that we have received, and that is going to help ease things in terms of the network and our ability to schedule. One thing I will say about recovery is that there has been an enormous amount of cost inflation in the aeronautical sector since 2019. And in particular, I'll call out airline landing charges, and those have increased far greater than the level of inflation. And those are things that we don't have a lot of control over. And so we have to work really, really hard on the transformation agenda to make sure that we can get those initiatives in place to mitigate that. So we're working really hard on all of those things. I can't say from the Board's perspective, exactly when these things will occur, and we'll be back at the 2019 level. But all I can say is that we are incredibly focused on growing into a stronger company than we are today. Thank you for that question. The next question is the cost of air travel domestically is often prohibitive for the ordinary New Zealander. What is the Board doing to improve the situation? And I wonder, Dean, if I might ask you to answer this question just while I have a quick sip of water.

Yes, certainly, Therese. The cost of air travel has been affected quite simply by the cost that it costs us to provide the service, okay? So the landing charges that Therese mentioned, the labor costs that are naturally increasing in the country, regulatory costs, CAA, through the roof. All these things have come on to Air New Zealand. You're not seeing the company's results here that are over the top in profitability, and that is because of the costs that we're incurring. So yes, cost of domestic travel has increased. It's will likely continue to increase unless we can get right on top of those external charges. But within the business, a lot is going on to make sure that we can work as efficiently as possible. Many of the initiatives that have been put into the company, particularly the digital initiatives that you'll see when you are traveling the Air New Zealand app, the check in -- the kiosk check in at the airport and what have you, we continue to develop to save time and that is cost. But yes, cost of travel has gone up. I sort of look across the ditch and what's happening across the NOS and I fly across there a bit domestically, it's considerably higher than New Zealand. We do need to keep these things in perspective. Costs have gone up, and ultimately, the customer does have to pay.

Thank you, Dean. The next question is what is up with your refreshments? Pretzels, fudge or American cookies. Why are you not using New Zealand fare? We actually are using New Zealand fare. That's the really great news. And we've run a number of initiatives to get Kiwi suppliers on board with different types of snacks on board. I have to say, at a personal level and from a Chair perspective, pretzels are my favorite. They are the ones that I always pick if I am on board. And so I think we've got a really diverse. And we're also changing it up periodically. Aren't we, Alex? So there are new snacks that will come and go. The cookie time cookie seems to be here to stay, but there are a number of New Zealand's providers and suppliers and mostly, if not all New Zealand suppliers, I'll just caveat that with mostly, but certainly, it's the biggest influence on our snacks. Right. The share price needs to reach $1.20 for investors to break even. How can you achieve this? Well, I think I would agree with you as a reasonably substantial shareholder of Air New Zealand that we would like the share price to be in a better place than it is today. And I think really what we are trying to do is to do all the basics in terms of investing and improving our operations, getting aircraft online and trying to manage the productivity and the financial situation of the organization. We have a really strong strategy in Kia Mau, and we're executing on that all of the time. And we're incredibly focused on increasing the strength and value of the company. And so from a Board perspective, that's where we are. The next question is, is your aircraft fleet up to date? Or are your aircraft getting old with many needing replacements like Qantas, for example? I would say that we're actually a reasonable way through our fleet renewal process in Air New Zealand in terms of the cycles of these things. And we'll be receiving a number of Boeing 787s over the next few years. But actually, the age of all of our aircraft across all of our fleet is quite young. So it compares very, very well internationally. And I think a number of our peers will be looking to further investment in their fleets more quickly than we will need to because of the investment we've undertaken. So that is very encouraging. And one of the great features of where we are as a new line at the moment. Thank you. The next question is, it is about time an AGM is held outside of Auckland. When will it be held in Wellington? Well, I'm not going to ask Larry to answer that question. Laurissa, would you like to answer that question? Thank you.

We are committed to holding our Annual General Meetings across the big centers. And we have hedged one of my time in Wellington. We like to hold them across the main centers, Auckland, Wellington and Christchurch. Last year, we were in Christchurch. And we're looking, I suspect, apologies, Larry, but to return probably back to Wellington in the near term, and we'll continue to review in the location of our meetings moving forward.

Okay. Thank you. And just following on from that, what prevents the AGM from being held in a smaller center of New Zealand, e.g. New Plymouth? We do try and get around the country, as Laurissa has just outlined. But also we actually, in terms of smaller centers, we're actually on the road a lot, both as an executive and as a Board. So this year, what centers have we been to this year? I'm trying to remember.

Guzman and Nepean and Hastings.

Yes. Thank you.

And [indiscernible].

That's right. So that's a number of different locations. And so those -- that going around the country like that as an executive and a Board to our 20 domestic ports allows us to have interactions with civic leaders, customers, businesses that do cargo operations with us. So those interactions are actually very rich. And so they complement getting around the country with the ASM. So the next question is poor performance, fewer accountants required, more practical approval with competitive pricing. So this is around the Board composition, I believe. And as an accountant, I'd have to say, not all accountants are so bad. Accountants, generally, the people that have an accounting background on this Board have actually gone on and done many more things. The accounting part of it has just been really kind of a basis to our careers, having confessed that I am one. I think, Neal, you have a strong accounting background. Laurissa does, and Alison does finance. Alison is more on the capital and finance side. But we do have strong financial skills on the board, that is for sure. But most of us are on board for different reasons, for additional reasons other than financial. Actually, Claudia, would you like to comment on the diversity of the Board's skills?

Yes. I mean I'm definitely not an accountant. But as somebody who's not an accountant, I really value that expertise. So let's just establish that from the start. It's a very critical capability for your Board, and we're well represented in that way. Larry has incredibly deep aviation experience but also has worked in rental cars and has deep understanding of tourism in large markets. And so and brings a very external perspective to us, which has really pushed us beyond our comfort zone, a number of times in a good way from a financial and performance standpoint. Ali's got very deep experience in the capital markets, and so she brings a huge amount of strength to us from a treasury, hedging and general financial strategy standpoint. Therese is just amazing. No more really needs to be said about her, but she is so much more than an accountant, as she reminds us often. Dean's come from CEO background, actually as has Neal. They both got CEO expertise, which is critically important around the boardroom because they understand the team dynamic, they understand how to motivate our team, how to challenge our team when that's required and also leadership, which is very valuable around the Board. And then Laurissa has also strong accounting background. But beyond that, a massive depth in sustainability, climate change and deep, deep connections across the community. She lives in to Taurunga. She's one of many of us who are regionally based. And so brings a deep sense of community, sustainability and tourism being part of Altra Circle.

Kia ora. Thank you, Claudia. The next question is, does Air New Zealand have any contracts or flights to Israel? And more broadly, given the conflict in Gaza and then international attention on human rights concerns, how does the airline consider geopolitical developments when deciding which international markets to serve? And specifically, is there any consideration being given to the U.S. market in this context? So I'll just start with a few comments, and then I'm going to pass to Greg. I think the first thing to know is that from a geopolitical and geoeconomic perspective, the Board is constantly reviewing. And again, I mentioned the risk register earlier and that is something that we spend a lot of time talking about, thinking about and receiving external advice and provocation on. In terms of the U.S. market, specifically, it is a really important strategic market for New Zealand. There's no kind of legal regulatory reason why we couldn't and shouldn't fly there. And so we will continue to do that at this time. In terms of Israel and the situation in the Gaza, we take all of those factors into account. Is there anything specific you'd like to say about that, Greg?

I think you've covered it all.

Okay. Thank you. Thank you. Excellent. So there are no flights to Israel directly from New Zealand obviously. Okay. The question is, why do you have so many directors? Well, we currently have 7 with an intention to move to 8 in the short to medium term with an additional airline expert to join the Board. And I think when I look at the number of the Board being 7 at this time, it is very normal size of a board. You'll find if you look around New Zealand or even around the world, that is very standard. In fact, a number of Boards can be higher than that. I would say that once you start getting below 7 to 5 or 6 directors, it is very difficult to meet all the skills that are required. Claudia outlined some of those skills that are brought to the table, but there are so many factors and the skills matrix that need to be considered when making directors appointments to make sure that we have fulsome knowledge across the board and the expertise required to govern this company. So I'm very comfortable at that 7 to 8 mark for the Air New Zealand Board as a standard approach. Okay. Thank you. The next question. Can you provide an expected time frame for when the reduced aircraft availability caused by additional global engine maintenance requirements will be resolved allowing operations to return to normal? Look, I think we've answered that question a number of times during this meeting. And obviously, the kind of the short summary is that we're hoping for some uplift in '27 and '28, FY '27 and FY '28, a little bit lighter at the end of the tunnel at the end of FY '26. But we cannot be specific about it today. We are working as hard as we can with those engine manufacturers and providers to ensure that we get access as quickly and soon as possible. Okay. That's all the online questions at this time. Kim, can I just check?

No, there are some more.

There are some more. Thank you, Kim, if you'd like to read those out to us.

First question is, what impact do you believe Jetstar's increased activity is likely to have going forward on airfares and on Air New Zealand's income and profit levels?

Well, Greg was just taking us through this the other day. So I'm going to ask Greg to respond to this question. Thank you.

It's something we're obviously monitoring very, very closely. And I'd have to say that at the moment, we continue to be a bit shaped by circumstance. So in other words, we've got sort of 5 to 6 of our very good new planes sitting on the ground at the moment without new engines. So we'd love to have those up and flying. And if we did, we would be able to compete a little bit more effectively with what Jetstar doing, which is adding a little bit more capacity. So we're watching it very closely. We're getting an indication at this stage of what they intend to fly over the next 6 months. They've made some announcements on that. Some broader implications are coming through [ out past that ] Our intention is to work very closely with the assets that we have available at the moment and make sure we plug any gaps that we have in the network. And the team are doing that as we speak. We'll continue to look at other tools like loyalty in order to compete well against them. And then one of the reasons that a group of us were working on this as recently as last night, is to see whether we can secure some more engines and whatever from Pratt & Whitney so we can get some more planes out there flying. But I won't get into the details on the P&L. That will play itself out. But this is something that we take very, very seriously. This is our house. And Air New Zealand is a proud part of this country, and our Air New Zealand is very proud. And just like there will be a lot of pride on Eden Park on Saturday night, you can rest assured that there is the same amount of passion in this airline to make sure that Air New Zealand does well.

Absolutely. Thank you. Well said. Kim?

Does the increased utilization of the remainder of the fleet mean there will be greater maintenance costs or earlier requirements to buy more planes earlier?

A little bit because, of course, you are having to fly those planes a bit harder. I'll share something that we've been working through. We have this issue with the Pratt & Whitney engine, and so we plan what we think is going to happen. And then we find out that we've got an issue with effectively an oil leak over the #3 bearing on the engine. And so that means that we had to do 7 engine changes in 5 weeks that weren't planned for. We do about 3x the amount of engine changes that we used to have to do at the moment to deal with the fact that we've got these Rolls-Royce challenges and Pratt & Whitney challenges. That means the existing fleet does fly a bit harder. That does mean that we have to go and make some changes, but we take that into account, and you should not be too concerned that we're not considering that and building that into our thinking.

Kia ora. Thank you.

Next question. Can you please explain why you're not seeking a full payment for the losses regarding the engine manufacturers for the problems affecting the fleet?

Yes. Really simple answer to that is the warranties run out in terms of Rolls-Royce. So those -- that decision to run those engines was made probably about 2004. The first one went on [ Wing ] in 2014. The first part liberated or the engine blade fell off in 2017. In 2025, Rolls-Royce came up with a solution for that particular issue. This is how long these things take in aviation are highly regulated in between your dealing with COVID. They're making other engines. This is a bit like the Toyota Camry has got a problem, but the Corollas going just fine. We, unfortunately, have the Camry. So these things take time. And in case of Rolls-Royce, the negotiations that we get are done by basically sitting in rooms and arm wrestling them. They, in effect, don't have to do anything. We do get compensation from them. We don't have any more of those engines on order, so it makes a negotiation even more difficult, but we do get compensation. Pratt & Whitney are newer engines. There is a compensation package in place. Pratt & Whitney actually worldwide took a hit of about USD 8 billion to cover this because there are some people out there that have 60 planes on the ground, like Wizz Air. We, fortunately, only have 6, but we're a much smaller airline. So it really hurts us. So they are covered with some warranty, but the warranty is not about recovering every cost that we incur. And that's just the way that they're structured worldwide. We are able to do our best to check that we get fairly compensated. And our view is that what we see elsewhere around the world, we're doing a pretty good job. I'd much rather we didn't have the issue at all.

Thank you. Why doesn't Air New Zealand fit the new blades themselves to the problem engines?

You're on a roll, Greg. You keep going with this.

Yes. We're not authorized to do that work is the simple answer. You can imagine, highly regulated. There are things that we are able to do on airplanes. And by the way, we do a lot. We have an incredible team of about 1,200 to 1,400 engineers that are spread from Auckland to Christchurch. We just opened a brand new hangar. So we have composite shops. We do what we can do. But on this particular item, this is an engine that Rolls-Royce own and manage, and they are the only ones that are authorized to do that work. And so that's why we can't do it. It's got to be packaged up, put it on a freighter and sent off to a shop overseas.

Thank you.

The next question is, has Air New Zealand considered providing a business or company with a company-level [Foreign Language] rather than individual? For a small business that has multiple staff that may travel from time to time, a membership at a company level may be more affordable while individually, it is not.

Right. Well, I'm going to ask Nikhil to answer this question because he has been closely involved in our loyalty program. So thank you.

The core membership is an individual membership program, and the plan is to keep it that way. Companies can issue Koru passes as an employee perk. And a lot of companies do that. And as far as we're concerned, we'd love more companies to do that, of course. One of the things we are doing, however, is looking to refresh our small- to medium-sized enterprise program. So a loyalty scheme where if you as an employee of a small business travel, the -- some of the points gets accrued towards the company itself. And then the company can choose how they would like to use that either as a staff benefit or use it to, in some cases, purchase a coffee machine for the office, for example, through our Airpoints Store. So there's a lot of flexibility around that. We're also looking to refresh our corporate and midsized company programs as we speak as well. So over the next 3, 6, 12 months, you'll see a lot of updates to our tiers and benefits not just on the consumer side, but also on the business and SME side of the customer base.

Thank you, Nikhil.

Next one. With all the turmoil with tourism in the U.S., why are so many flights still hitting that way? And I hope that future London flights don't go through LAX. Why not through Vancouver? It's a much nicer welcome at customs, et cetera.

Okay. Thank you. I think we've answered both of those questions already in this meeting. In terms of flying via LAX, that's already been answered. that is a consideration as well as Singapore and that work is still underway. So we'll be able to let people know in due course. The U.S., as I mentioned earlier, remains a really important strategic market for New Zealand. And at this time, there's no overriding reason why we wouldn't continue with our flying to the U.S. Thank you.

Why is Air New Zealand being at the bottom of the world persevering with an aircraft 787, not capable of ultra long haul when they're in a financially excellent position. i.e. New York to Auckland seeks Limited. Can the 787 get to India and back from Auckland?

Greg.

I'll deal with the last point first. Yes, a 787 would easily be able to fly to Auckland to Delhi with a full payload. When we get our 2 new 787s, and we're expecting to receive those in March, April next year, they will go on to the Auckland-New York route. They have a new engine on them, a Gen X engine, and they have a different, what we call loper, or seating configuration, 219 seats. They'll also have Skynest on them. And that will allow us effectively to be able to fill the plane. So what we've been running for the last 2 and a bit years, waiting for these plans to arrive is something that works but it's not fully optimized. But come April, we will have the best plane to operate long haul. We're very comfortable with the 787. We like them. And with the Gen X engines on them, they're going to be configured to operate ultra long haul as good as any airline in the world

Thank you, Greg. Next question.

How many full-time equivalent staff do we currently have? And is this likely to fall over the coming 12 months with the rapid rollout of AI? Which parts of our business and operations are the most prospective for AI productivity gains? And how energetically are we embracing those opportunities?

Just going to ask Nikki Dines, our Chief People Officer, to answer that question. Thank you.

Good afternoon. We have around 11,700 full-time equivalents, and that's made up primarily of our operational frontline staff. And then we have about 2,500, 3,000 office-based staff. We are energetically embracing AI, I think, is the best way to put it. We have given access to enterprise GPT, AI tools to all of our knowledge-based workers. Every laptop has access to these tools. And we are already seeing some excellent productivity gains in areas like our contact center. We can see great opportunities in a lot of our planning areas, so engineering planning, inventory management. And so each part of the business is looking at how they can use these tools to work more efficiently and productively and also more consistently. Being a highly regulated business, obviously, working with our regulators around how we can use these tools is really critical. So that's very much on our radar for doing that as we roll out these tools into the operational area.

Thank you, Nikki. I could probably read out the next question. Air New Zealand does not seem interested in flying international out of Christchurch, only Auckland. If I wish to fly out of Christchurch to North America or Asia or even to get to Australia at a reasonable ETD and bypass transit through Auckland, which is a less than pleasant experience, I have to use an ever-increasing number of other airlines. As a shareholder, I'm getting sick of people referring to Air New Zealand as Air Auckland. Will this be corrected in the near future? Or are the Board and CEO not interested? There is no shortage of South Island Tourist. Look, I think we've came us today a lot of the issues around engines and aircraft availability. We would love to be doing more out of Christchurch. But unfortunately, at the moment, we are quite constrained. That will change over time as we've discussed today. And we want to give our customers as many options as possible going forward. I did want to comment that in terms of Auckland, it is a hub for us. It is a really important hub because, obviously, of the population size here, that doesn't mean it will be the only place that flights depart from. But I would say that based on the current way that Auckland Airport pricing is going, that will have to be a consideration that we take over the future years, unfortunately. Thank you. Okay. The next question is, is Air New Zealand thinking of changing its name to Aotearoa, which I would not support as it means nothing to the rest of the world. We're not considering changing our name, but what we continually do is immerse kind of Maori attributes, Maori language attributes and visual identity into who we are as an airline. It's actually very compelling for our offshore markets. And -- but we'll continue to use Air New Zealand. So it's still a very important part of who we are and what we do. Okay. I am a proud Air New Zealand shareholder, and I'm loyal to use Air New Zealand when they are available. However, my parents who often come back and forward between New Zealand and Asia, unfortunately, end up using Qantas because its flight costs close to half comparable with Air New Zealand. As he is a frequent flyer, he ended up in higher-class membership, which makes him often get free upgrades to business class or even just add lower cost to go to business class. Any advice on how I can convince my dad to fly with Air New Zealand? I'm sure you're the favorite child, and I'm sure you could do a good job of convincing your dad. But in terms of the pricing, Greg, would you like to make a few comments?

Yes. Look, not a question which I've never seen before. And Nikhil, you'll look forward to getting a few of these as well. The simple answer is that, obviously, we're in a competitive business here. I know some people will say, well, hang on a minute, regionally, it's not all that competitive because a lot of people don't fly to the regions. We do have competition. Even where we don't have airline competition, people can choose to drive or whatever else they want to do. The rest of the country is actually pretty competitive. We've spoken about Jetstar today. I think there are 32 airlines that fly in and out of New Zealand. We have to keep track of what their prices are. We have to compete with them. If our prices were ridiculously expensive, we'd have empty planes. So we are very conscious of price. And the simple thing that I often say to people is, generally, you get a price when you book earlier.

Excellent. And the last question, I think, unless there are any more online is, why would we not get A350s? A350s are very large aircraft, no? Would you like to answer, Richard. Richard, if we can get a microphone to Richard. The A350.

The 350 is a very good airplane. We committed to the 787 back in 2004. To Greg's comments, earlier comments, 350 wasn't around then. We've got 24 aircraft in total in our widebody fleet at the moment. And in 4 or 5 years' time, it might get close to 30. But it's certainly not a big enough fleet to warrant splitting it down the middle and having 2 seats of different equipment. We did run the rule over the 350 in 2019. I think it was. I wasn't with the company then, and they came out similarly on performance. But by the time you take into account the fact that you've got to have a whole bunch of different tooling, you've got a new engine on -- a different engine on the airplane, you've got different training devices and all sorts of spares and parts that are all different just on a fleet our size, it just doesn't justify having the 2 different sorts. So it's a good airplane, but we bought the 787s 20 years ago and the DS-9, which we've got at the moment and the DS-10, which we soon to get a very effective piece of equipment.

Thank you, Richard. And while we try to simplify the fleet and keep to a small number of aircraft types for the very reasons Richard outlined. It is also good to have some supply from Airbus and some supply from Boeing in terms of redundancy and contingency going forward. So can I just check if there are any other questions from the floor before we close the meeting? We've got someone with the near bus kit. Any other questions from the floor? No. Okay. That completes the formal business of the meeting. Thank you, everyone, for your attendance and participation this afternoon. In conclusion, let me say that your continued support of Air New Zealand is very important and very much appreciated. I formally declare this meeting closed. We invite you to join us now for refreshments and afternoon tea. Thank you. [Foreign Language]