Air New Zealand says it expects to earn $20 million in the second half of its financial year from unused travel credits, as many customers let their credits expire.
In a statement to the NZX, the airline said it now forecasts earnings before tax for the 2025 financial year to fall between $150 million and $190 million. That’s down from $222 million last year.
The drop is partly due to lower compensation from engine manufacturers, which the airline described as “substantial.” The compensation relates to grounded aircraft.
The $20 million figure comes from what the airline calls “credit breakage”—money from unused prepaid airfares, travel vouchers, and other customer credits. The airline can count these funds as revenue once it is confident the credits will not be used or have expired.
Jeremy Sullivan, an investment adviser at Hamilton Hindin Greene, said many of these credits were issued during the Covid-19 pandemic when travelers chose credits over refunds.
“Some people may have forgotten about their credits, moved, or found travel no longer practical—especially with Air New Zealand’s reduced capacity making it harder to book,” he said.
Sullivan added that $20 million is likely more than the airline had expected and represents a significant portion of its earnings. He urged customers to act quickly.
“Check your Air New Zealand Airpoints or credits. Use them, transfer them, or spend them in store before they expire,” he said.
Credits issued during the pandemic lockdown must be used to make a booking by January 31, 2026, and travel must be completed by December 31, 2026.
For credits issued after October 1, 2022, customers have 12 months from the issue date to make a booking, and travel must be completed within 355 days of booking.
Air New Zealand has not yet commented further on the matter.
