By Stephen Wright
WELLINGTON, New Zealand–Air New Zealand Ltd. has forecast its losses to increase after the government suspended quarantine-free travel with Australia for two months.
The airline said its loss for the financial year that ends June 2022 will be as much as 530 million New Zealand dollars ($372 million) before tax and signficant items, compared with a previous forecast of about NZ$450 million.
Prime Minister Jacinda Ardern’s government halted a travel bubble with Australia in late July because of the risk that the more transmissible Covid-19 Delta variant could reach New Zealand, which has had little more than 2,000 Covid-19 cases and few deaths.
Air New Zealand said Wednesday it will tap a NZ$1.5 billion government loan by the end of August because its operating cashflow has reduced. The carrier, half-owned by the New Zealand government, said it had last drawn on the credit facility in February and its borrowings from it total NZ$350 million.
Air New Zealand, which plans to call on shareholders for a cash injection by the end of September, also has forecast a loss of NZ$450 million for its 2021 financial year due to the pandemic decimating international travel.
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