(Reuters) - Air New Zealand Ltd on Monday trimmed its 2019 earnings outlook by cutting out the upper end of the forecast range, citing headwinds from increased jet fuel prices.
New Zealand's flag carrier said it now expects the 2019 earnings before taxation to beat NZ$340 million ($223 million), compared with a range of NZ$340 million to NZ$400 million announced in late March.
"Based on the current market environment and reflecting an additional NZ$25 million headwind from increased jet fuel prices, we are targeting 2019 earnings before taxation to exceed NZ$340 million," the company said in a statement.
The previous outlook had assumed an average Singapore jet fuel price for the full year of $81/barrel, while the current outlook assumes an average of $83/bbl, the company added.
The revised earnings outlook came as Air New Zealand earlier on Monday said it has ordered eight Boeing Co 787-10 Dreamliner jets worth $2.7 billion at list prices.
In March, the airline launched a two-year cost reduction programme and deferred aircraft capital expenditures of about NZ$750 million as part of a business review to tackle slowing growth.
Air New Zealand had posted a 35 percent drop in its half-year pre-tax profit as softening tourism traffic and weaker domestic leisure travel took a toll on its financials.
In February, the airline slashed domestic fares by as much as 50 percent in a shakeup of its pricing structure in response to the slackening travel market.
(Reporting by Aby Jose Koilparambil in Bengaluru; editing by Richard Pullin)
