Welcome to the Air New Zealand 2024 interim results call. During the presentation, your phone lines will be placed on listen-only until the question-and-answer session. Please refrain from asking questions until that time. With that, I will turn the call over to Air New Zealand's Head of Investor Relations, Kim Cootes Thank you, and good morning, everyone. Today's call is being recorded and will be accessible for future playback on our Investor Centre website, which you can find at www.airnewzealand.co.nz/investorcentre. Also on the website, you can find our interim results presentation, the interim financial report and media release, as well as other relevant disclosures. Speaking on the call today will be Chief Executive Officer Greg Foran and Chief Financial Officer Richard Thomson. Leila Peters, our GM of Corporate Finance, will also join us for the Q&A session. I would like to take a moment to remind you our comments today will include certain forward-looking statements regarding our future expectations, which may differ from actual results. We ask you read through the disclaimer, and in particular the forward-looking cautionary statement provided on slide two of the presentation. I will now hand the call over to Greg. Thank you, Kim. Kai ora, good morning, everyone, and thanks for joining us on today's call. Earlier today, we released our interim results to the market, announcing earnings before taxation of NZD 185 million and net profit after taxation of NZD 129 million. This is in line with the guidance we provided back in December and reflects an expected reduction in earnings compared to the prior period, where pent-up levels of demand in a capacity-constrained environment drove a very strong performance. On the back of our result and taking into account the strength of our balance sheet, the board was pleased to announce that shareholders will receive an unimputed interim dividend of NZD 0.02 per share. This represents a 41% payout ratio based on the prior 12 months' NPAT and is in line with the revised dividend policy we announced last August. Over the past six months, we grew the network significantly, particularly on our international routes, with total group capacity increasing 29% thanks to the full return of our 777-300 fleet. Scaling up isn't easy, particularly in an aviation ecosystem that is still hampered by disruptions and delays. But we've continued our training efforts, onboarding an additional 170 people in the half to help build resilience in. We know things still aren't perfect, but we've taken a series of deliberate actions to improve key operational metrics and to create an even better flying experience for our customers. And you can see that in the improved customer metrics and operational performance, which I'll touch on later. All in all, this is a result we can be proud of, especially when you consider it was delivered against the backdrop of an increasingly challenging operational environment. As just one example, the additional maintenance requirements on our Pratt & Whitney engines will see up to five of our newest and most efficient A321neo jets out of service at any one time across the next 18 months at least. The impact this has had operationally should not be understated. Productivity gains and efficiencies we anticipated at the beginning of the financial year will now take longer to realize as we carry extra costs to help keep our customers moving. Richard will touch on this more later. These challenges have once again brought out the very best in our exceptional team of Air New Zealanders, who've gone above and beyond to mitigate the impact of these disruptions. For that, I want to say a huge thank you. Turning to slide five, you can see that we've made some great progress on key operational metrics. We've made improvements to our service offering both on the ground and in the air, including enhanced food and beverage offerings and in-flight entertainment options. In November, we opened our new premium check-in area at the international terminal in Auckland Airport. We have invested in the contact center, both in terms of people and digital tooling, which has seen average wait time numbers that are much improved. Most importantly, these investments have been noticed by our customers, with customer satisfaction levels recently returning to pre-COVID levels and holding steady. It's taken a lot of focus, hard work, and deliberate investment to get these results. We believe there has been the right decision as we lean into the ongoing instability and sideswipes that the industry has been experiencing. At the end of the day, our customers will look to us regardless of whether an issue is within our control or not, and ensuring their trust in Air New Zealand maintained is a priority. I think everyone can agree that we've seen our fair share of challenges emerge across the past six months. While these issues are not particular to Air New Zealand and indeed are being felt by most airlines globally, that doesn't make them any less frustrating. I won't go into each point in detail here, but I'm happy to take questions later on. What I do want to focus on is the huge amount of work that's been undertaken to mitigate impacts to our schedule. As I mentioned earlier, the Pratt & Whitney additional maintenance requirement remains our single most impactful operational challenge this year, and the ripple-on effects across our domestic and short-haul networks would have been immense if we had not acted quickly to secure various short-term aircraft leases. We have re-entered into a short-term wet lease with Wamos, as well as procuring two additional 777-300 dry leases. One of these is already flying on the network, and the other will start in June. These aircraft have a lease period of 3-four years, with some optionality to extend if required. We are also in the process of finalizing the lease of a third 777-300 aircraft, which would arrive later in the year and again has a lease term of four years. Despite our best efforts, these issues, along with those of other airlines, cause a greater proportion of our customers to call, email, or use social media channels to reach us than before. Case in point, when Alaska Airlines had the 737 MAX issue in January, our contact center was flooded with calls from customers with questions about their itineraries, even though we don't operate that aircraft type. We made the decision in November to add temporary resource into the contact center to help with expected call volume increases, as well as respond much more rapidly to written queries. This has driven considerable improvements in wait times and other key metrics we monitor closely. As we roll out additional digital tooling in the coming months, some of these costs will come out as we enable greater self-service functionality. Altogether, we estimate a further NZD 35 million of additional costs in the second half to mitigate customer impacts resulting from these challenges. Turning now to slide 7, we haven't been the only carrier scaling our network back up towards pre-COVID levels, and this has been particularly evident on North America. As we entered into the summer high season, international competition really kicked up, driving historically high levels of capacity on the U.S. to New Zealand market in a very short period of time. For context, in January, market capacity between the U.S. and New Zealand grew around 65%, whereas U.S. arrivals were only up 35%. While fares held up initially, there was a notable pressure on fares and on months' sales build going into December and January peak holiday season. Both yields and load factors are now seeing softness driven by excess supply. We're seeing the most competitive pricing in the economy cabins, with U.S. carriers offering what we believe to be unsustainably low fares. Premium cabin pricing and demand continues to hold up well, and we're seeing more resilience in pricing levels for those passengers. The other area of increased market capacity is on the Tasman, although the competitive dynamics are different. We are one carrier down in this market, and both Air New Zealand and Qantas have grown back strongly. Demand in this market tends to be price-sensitive but has responded well to fare adjustments and sales activity undertaken to stimulate demand. Average fares are still well above pre-COVID levels and are reflective of the significant increase in costs to operate. There are a number of bright spots as well, notably the Pacific Islands, which is a market of critical importance to us in terms of linkages to New Zealand. Demand in these markets remains strong. In Asia, we see continued strength in outbound travel to Japan, due not only to the weaker yen but also great word-of-mouth from Kiwi travelers. Singapore as a hub remains very popular, and in the past six months, we've seen tremendous traffic from India coming to New Zealand via this port. Turning to domestic, as we signaled back in September, corporate and government demand has continued to track below last year. This has put pressure on yields in this part of the network. As a result of lower demand, we'll be making some targeted capacity reductions. In addition, as a consequence of the continued inflationary impact across our cost base, we will be lifting our pricing. We are cognizant that the leisure traveler is more price-sensitive, and this will further impact demand somewhat, but we'll manage this carefully and adjust as necessary. Based on what we can see in our forward bookings profile, we expect continued yield pressure, particularly into the fourth quarter, which is our traditional low season. This will be most evident on the long-haul international market. The fourth quarter is always a difficult period to forecast and will be even more so this year given the intense competitive environment. Our experience suggests that at some point, we will see both pricing and capacity adjustments from our competitors, some of whom are unfamiliar with the New Zealand market and its dynamics. Finally, building on what I've just laid out, we've provided a market update on the 19th of February, stating that a number of continuing economic and operational conditions have deteriorated and are now expected to have a significant adverse impact on performance in the second half. These include the impact of additional competition on forward revenue performance, ongoing weakness in the domestic, corporate, and government demand, temporary cost headwinds of NZD 35 million in the second half to alleviate customer impacts, and operational pressures as well as ongoing cost inflation. In light of these conditions, the airline considers that performance for the second half of the 2024 financial year will be markedly lower than the first half. In this context, and assuming an average jet fuel price of $105 US a barrel for the second half, the airline currently expects earnings before taxation for the 2024 financial year to be in the range of NZD 200 million-NZD 240 million. This range includes NZD 20 million of currently assumed additional COVID-related credit breakage over the second half. Those future redemptions of COVID-related credits remain uncertain and subject to further actions. I will now pass over to Richard, who will provide more detail on the first half result as well as update you on our fuel hedging fleet and capital management performance. Thank you, Greg, and kia ora to everyone on the call this morning. Turning to slide 10, I'll touch on some of the key financial highlights for the first half while acknowledging Greg's comments that the forward trading environment is expected to be much tougher. Operating revenue for the half was NZD 3.5 billion, driven by strong capacity growth on our international network. Passenger revenues were NZD 3.1 billion, and alongside this, the cargo business had revenues of NZD 243 million. While cargo revenue is 36% lower than last year, reflecting significantly increased competitor capacity, which also drove lower yields, particularly in North America, it is still around 25% above pre-COVID levels. I would point out that the prior period benefited from NZD 83 million in government subsidies that are obviously no longer in play. Earnings before taxation was NZD 185 million, and we ended the period with liquidity of NZD 2.1 billion, following payment of a special dividend of NZD 200 million and the purchase of a Neo aircraft without any new debt. As Greg mentioned in his opening remarks, the board has declared an unimputed ordinary interim dividend of NZD 0.02 per share, which represents a 41% payout ratio on the prior 12 months' net profit after tax. Just a reminder that we do not have imputation credits after paying our special dividend in September last year, and we will likely not have them for a few years yet. Our liquidity and balance sheet remain strong. Moving on to slide 11 and looking at our profitability waterfall, there's a lot of information here, so I will only highlight a few points. The cost story for us this year really is one of a significant ramp-up in activity from more long-haul capacity, combined with the cumulative impact of inflationary cost pressures across the business. I'll touch on fuel in a later slide, but labor costs were up 17% to NZD 801 million, with additional activity in the half driving an increase in our FTE labor base of around 14% to approximately 11,650. One of the many flow-on effects we faced due to the additional engine maintenance requirements on our A321neo and 787 fleets is that productivity gains and efficiencies we anticipated at the beginning of the financial year will now take longer to realize. We estimate that relative to the levels of productivity achieved pre-COVID, we have about NZD 50 million in productivity gains yet to be realized. This is driven largely by constant adjustments to our schedule and the resulting inefficiencies. To be clear, this is on top of the NZD 35 million of temporary cost headwinds outlined by Greg earlier. Aircraft operations, passenger services, and maintenance costs were up NZD 187 million, or 28%, driven primarily by increased flying on international long-haul routes as well as broad-based inflationary impacts. This was partially offset by reduced third-party maintenance activity following the wind-down and closure of the Gas Turbines operation in September. The other expense line includes around NZD 15 million in short-term Wamos lease costs and additional contact center resources of around NZD 6 million. Touching briefly on slide 12 and our CASK performance in the half, while costs increased across all areas as we restored our international network, reported CASK improved by 6.1%. This was largely a result of a change in the mix of flying, much more long-haul flying this half, and lower fuel prices compared to the prior period. Underlying CASK, which excludes the impact of fuel prices, foreign exchange, and third-party maintenance, improved by 1.2%. The mix of longer sector flying was partially offset by broad-based inflation of about 5% across the non-fuel operating cost base. Looking ahead to the second half of this year, we still see mix playing a role in CASK compared to 2023, albeit to a much smaller degree. We have provided an updated capacity outlook on slide 18 in the supplementary section of the presentation. Turning now to slide 13, which summarizes our fuel hedge portfolio, we are approximately 75% hedged for the remainder of the financial year and 40% hedged for the first half of next year. Our hedges are for Brent crude, meaning that our fuel cost is exposed to volatility in the crack spread between crude and jet fuel prices. This has continued to fluctuate between the $21-$25 range in recent weeks. In terms of structures, we have call options in the near-term months and collars further out. We regularly look to restructure our hedge book to adjust the profile when appropriate. Geopolitical uncertainty in the Red Sea region in recent weeks has also resulted in significantly increased fuel freight costs from some of our international ports where we uplift fuel. We've made some assumptions about interplane costs in the second half to account for this, which is currently around NZD 15 million. We've provided our current estimate of second-half fuel costs, which assume an average jet fuel price of $105 per barrel. Based on the makeup of our hedges, we've also provided an estimate of how an increase or decrease in fuel price would impact our fuel costs in the second half of the year. Moving on to slide 14 and an update on our aircraft CapEx, as Greg mentioned earlier, we have had to adjust our expectations for the delivery of the first two new 787s yet again. Initially, these planes were expected to deliver in late calendar 2023, then calendar 2024, but now, with the production issues facing Boeing, which are well-known, our latest best estimate is that we won't receive these planes until halfway through the 2025 calendar year. The CapEx profile you see on the chart here assumes now that we take delivery of four 787s in the 2026 financial year. This assumption may change as we work further with Boeing. This delay is certainly disappointing, but we're focused on the things we can control, and securing 3 short-term 777 dry leases will help support the network and enable some flexibility around the eventual exit dates of our existing 777 fleet, of which we have 7. Pleasingly, our interior retrofit program for the existing 14 787s remains on track to start in August. Following a number of tests and certifications, we hope to commence with the first aircraft going in for a retrofit midway through this calendar year and be able to have customers experience the new interior product by the end of the year. As a reminder, this is a multi-year program to get all 14 787 interiors redone, and we've provided the approximate CapEx profile involved in the stacked bar chart on this slide. In a month or so, we'll have an additional domestic A321neo into the fleet, although initially, we're likely to need to use the engines on that aircraft to keep our other international narrowbodies flying. We will be funding this aircraft in cash, as we did with an earlier aircraft in the first half. Despite the additional maintenance requirements we're facing, having these neos is important for our domestic network given their fuel efficiency and bigger gauge. The total forecast aircraft CapEx is approximately NZD 3.3 billion through to 2028, and as we get closer to delivery dates for the 787s, we'll be turning our minds to funding options. Turning to slide 15, a number of actions have been undertaken to move our key capital management metrics toward our stated targets. We're very pleased to have our credit rating from Moody's upgraded from Baa2 to Baa1 over the period as well. Before the end of the financial year, we will also look to repay some debt. As I've mentioned before, we are focused on prudently returning to these targeted ranges for liquidity and leverage, which I expect will take approximately 12-24 months. The airline remains in a fundamentally strong position. Our balance sheet is robust, and the board is committed to the airline's capital management framework, as announced last August, including its ordinary dividend policy. Finally, to those on the call, thank you very much for your time today and listening as we've shared our results. I know you'll have questions, so operator, please open up the line. Anne, thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. One moment for our first question, please. Our first question comes from Andy Bowley from Forsyth Barr. Your line is now open. Thanks, operator. Good morning, guys. I've got a couple of questions here, the first of which is around the current environment. So you've talked about a really challenging second half, and we can see from the full-year guidance what's implied through the second half from an NPAT point of view, but sorry, from a PBT point of view. Can you talk to how you see profit development through the next six months across each of the major segments of the business? I'd envisage that long-haul is likely to be loss-making given the comments you made around North America, but what about domestic and Tasman PI? Yeah, thanks, Andy. It's Greg here, and thanks for your interest. I'll make a couple of comments, and Richard and Leila can follow in on anything that they want to. You're quite right, averages can be a bit meaningless, so it's worthwhile breaking it down. Domestic, I'd say, first of all, in terms of revenue in domestic, and let's even break that down between sort of the corporate business, government, and leisure, I'd say that the leisure component of revenue in domestic continues to be pretty good. Every now and then, we tickle the market a little bit, stimulate it, and when we do, we see really good demand. So pretty happy with revenue in domestic. It's not off the charts, but by no means are we seeing leisure fall away. When you get down to the government sort of business, small, medium enterprise, which is about 40%, our senses, and we're seeing a little bit of this. We saw a little bit of it pre-election. It is that, in particular, the government component, which works out to be about 1/3 of that 40%, by the way, I think it's going to get a bit more pressured as the Minister of Finance and the PMs start to pull some purse strings and hold people to account to get some dollars out. So we're a little bit wary of what we're going to see there. Small, medium enterprise is good. Top end of town has come back reasonably, a little bit flaky in parts, but leisure is good. So domestic is good from a revenue perspective, but boy, we've taken some costs and we've held our prices down, and that's seen the margins come down. So domestic, which historically has been a bit of a powerhouse both in terms of revenue and profit, we've got some work to do on profit, and that's exactly what we're doing. So sort of three things that we're looking at doing there. One of them is being pretty sensible around how we're revenue managing. Number two, we are having a look at ancillary products. And number three, very carefully having a look at capacity, particularly as we think about government and how we may just adjust that. So without swaying the pendulum to any great extent, we're just going to get that profit up in domestic. Put a tick against PI and Tasman, and those are being well-managed. RASK is up. CASK is up, but the profit, the margins are good. A little bit of stimulation every now and then on the Tasman, but shares holding up well. It's going well, and the PI remains very good. International, you can split into two camps. Let's talk about north first. So when you're talking about sort of Singapore, Japan, Hong Kong, they're actually going really, really well. And both the RASK is being well-controlled, the CASK is being well-controlled, margins are good. India is a bit of a bright spot there, people transiting through Singapore. It's too early for us to be going direct to India, but it'll be on the cards at some point. China is coming back, but that's really a government issue. And until Xi Jinping and team start opening up and getting passports and visas through quicker, it's just a bit constrained. Bali is great. Different story when you get to North America, and that's been one of the things that's given us pause for thought for the second half because we saw the competition enter there 12 months ago. We had American, and we've got Delta, new entrance in, United in, Qantas obviously going through to New York. Give you a factoid, 28 flights a week still between Auckland and L.A. That's more than we've ever seen. No one at this stage is blinking, but for anyone who's been in this business a while and you have, you know that at some point someone's going to because what we're seeing is light loads, and we're seeing prices come down, particularly at the back end of the plane. So business isn't too much of an issue. Premium economy is good, but you're talking about economy prices now that are, in some cases, bordering on a bit ridiculous. We're not going to play that game. We'll just put up with the fact that it's going to be a bit tighter and lighter, and we'll wait everyone out because we know at a point in time (and I don't know, maybe it'll be northern winter 2024, so October, November this year) maybe someone's going to start to say, "Well, this is a bit silly." One of the issues, of course, is that until China opens up, i.e., between the U.S. and China, they probably don't have much better use for their metal. I think there's still only 48 flights a week, China-U.S., U.S.-China, and that compares with 600 pre-COVID. So the pricing on that route for both the Chinese and the American airlines is off the chart. You can be paying $30,000 business class, San Francisco, Shanghai return. So no one's rushing to get that fixed. I don't think China are rushing to get it fixed from their perspective in terms of keeping their economy going. And I doubt the American airline CEOs are rushing to get it fixed because they're probably making more money out of 48 flights than they were out of 300. And there's always the opportunity to blame Russia and the Ukraine. So what I will say about it is the U.S., we haven't changed our view. It's our North Star. We're committed. We'll just take a deep breath. The strategy's right. We know that increasingly, as the new orders come in on the Boeings, that'll be the end of 2025. That'll improve performance further. We'll get there. I will pause and see, Richard, what do you want to pick up? There you go. I think you've covered it pretty well. Thank you. That was a very thorough answer, Greg. Thank you. Just too long and boring. I'll be on too long and boring. But anyway. On the domestic side, you say profit needs to get up. You use the word profit. That, to me, assumes that it's not going to be loss-making through the second half, which implies that the losses in North America, in particular, are quite big. No. The losses in the States aren't big, but I think there's a sort of combination of things going on, Andy, in the second half. If you think about what happens in the North American market, each widebody you add to that market adds, probably, $80 million of cost to the market on an annual basis. And if you're not growing the market to the same extent as you're growing capacity, those losses can become burdensome. Just to give you sort of a stat that I think's interesting, in January, just gone, the States and New Zealand released some data last week that indicated that capacity between North America and New Zealand versus January last year has grown by 65%. Inbound U.S. visitor arrivals have grown by 35%, and that has required some stimulation to achieve that. So obviously, that's come at a sort of a RASK; it would have been challenging from a RASK perspective. I mean, we are guiding to a profit, albeit modest, at this stage for the second half of the year, but also point out that we are carrying a number of these sort of one-off costs. This business works best when you can plan ahead with surety, and we can't do that at the moment. So I think it is worth re-emphasising that in the second half of the year, we're expecting to carry, or we're committed to carrying, in fact, NZD 35 million of additional costs on this Wamos wet lease, which we intended to exit in October last year, did in fact and bought it back, these triple seven dry leases. Because we can't plan our fleet with any certainty, that is playing back into sort of productivity metrics, which we're dissatisfied with, which are sort of NZD 50 million on an annual basis. We're not going to get all those back in the second half of the year, but it's an unusual drag on the business, is the point I'm making. So yeah, so North America, pretty challenging, but we are still at this stage forecasting a profit for the second half of the year across all the route groups, notwithstanding those temporary significant additional cost imposts. One of the things we've done, Andy, is we got to a point, probably about August last year, where we could see what was happening with Pratt & Whitney. We've still got challenges with Rolls-Royce, by the way. We had a sense that Boeing weren't going to be able to hit what they were going to hit. We could see we were going to have to scramble to get some leases, triple seven leases. We started debating what we'd do with Wamos, and we said to ourselves, "We're going to trade off some cost here in order to ensure that both our customer and staff experience could hold up." Because I just wasn't prepared to go into Christmas and have people waiting on phones and waiting to get responses to emails and social media. It's just not fair on our people in whatever part of your business. We're quite clear that we're not as productive as we need to be. But having said that, our customer satisfaction scores are now actually higher than what they were pre-COVID. There's some really good results coming through around all the things that you'd expect, whether it was food and beverage or Wi-Fi or lost bags or call center wait times. I stand by that decision. I think it's a good decision. Maybe we could have made another NZD 40 million-NZD 50 million, but I think we've got customers on our side. I think we've got a staff that are on our side. Once we can get through some of this ecosystem disruption, then we'll be able to get this thing tuned and up and going pretty well. It was a deliberate decision, and as I said, I stand by it. No, great. Look, appreciate the thorough response. So look, my other question was around the topic issue yesterday. So the Minister of Commerce is on the radio this morning saying he'd already spoken with you guys around airport regulation. Could you give us some color as to his response to your concerns? Yeah, we have met him. We've met with a number of ministers, Andy. We've caught up with Simeon Brown. We've caught up with Andrew Bowley in some detail and continue to stay in touch. So we didn't want to surprise anyone with what we did. His reaction is one of real interest. So when I personally met with him, with a number of our team, he was really engaged in, "This is a topic," and I think understands what we're talking about here. It can be complicated to a number of people. It's quite complicated to explain as I'm learning, having to do lots of media on it. But I know that you understand it well, and he is understanding it in the way that we would like him to understand it as well. So he said to us, "Give us a letter." And we did. We spoke to Auckland Airport before we did that, but we got the letter out to him yesterday and continue to stay engaged. He's going to have to follow due process. He's a minister. He's new. But I'm confident that what we're doing is right, and we're going to get there where this is just the beginning. There'll be no letting up on this. Great. Thanks, Greg. Thank you. One moment for our next question. One moment, please. Our next question comes from Marcus Curley from UBS. Your line is now open. Good morning, team. I just wonder if we could start with some sort of details in terms of where you think airfares will land for the full year relative to pre-COVID across the main regions? And then I'm just going to follow on from that after that. Yeah. Marcus, Richard here. I'll have a go at that one. You obviously can't give any guarantees on where airfares will end up. But what I would say is that since pre-COVID, we've had 25-odd% sort of compounding inflation in the CASK across that period of time, like for like. And as Greg mentioned before, in domestic, actually, fares have only just kept pace with those cost increases, and we're leaning into more cost increases in the second half of the year. In Tasman and Pacific Islands, we're running actually just slightly ahead of that. So sort of airfares or fares are up between 25%-30% on the short-haul international network, and on long-haul, they're just chinning the bar, 25% above where they were. But again, just reiterate the comment that sort of Greg made before. The challenge for us in long-haul at the moment, particularly on North America, is not the premium cabins but the economy cabins. As you well know, Marcus having covered the stock for as long as you have, May and June are two of the most difficult months for us to forecast from a long-haul revenue perspective. And then, Richard, just could you break down long-haul so where would be U.S. versus Asia in terms of full-year outcome, broadly speaking? In terms of where sort of fares are sitting? Yeah. Obviously, within your guidance, so obviously, 25% above pre-COVID for long-haul, but what would be U.S. versus Asia within that? Actually, I don't know that off the top of my head, Marcus. I might have to pick that up separately. Yeah. Marcus, it's Leila. U.S. is always sort of on average, the yields are higher than Asia. You're well across that based on covering the stock for as long as you have. I'd say that within Asia, there is quite a variety. As Greg mentioned, Bali's performing extremely well. That is a fully leisure market versus some of the other Asian ports have some mix of business. And then the mix between inbound and outbound passengers also impacts the yield, the average yield. But on the whole, Asia would be a little bit lower than the U.S. looking forward, just based on those market characteristics. Okay. On a CASK basis, Richard, you're 25% above. On a CASK basis, a bit higher than that. Yeah. Yes. So, where would your unit costs end up this year relative to pre-COVID? Yeah. So in the second half of the year, obviously, sort of CASK has reduced over the first half of the year as the mix of flying has changed materially. Over the second half of the year, we've got a lot less international growth, so that'll be far less pronounced in the second half. My estimate is that CASK's not going to change materially on where it is at the moment due to mix. Okay. Look, I suppose where I was and that includes a large number of one-offs. So if you stripped out the one-offs, do you have a view on where the underlying CASK would be on a go-forward basis? In cents per share? Well, just relative to pre-COVID. I suppose where I'm going with this is, yeah, the direction of travel is capacity comes in. Yeah. So yeah, we still don't have all the capacity in on Asia, as you've said. To Tasman, probably, there's still more to come. What I'm trying to get out here is understanding if we look into FY25 on the basis that airfares are still coming down a little, is the business capable of returning to a healthy level of profitability? Yes, of course we are. So just answering your first question, so CASK in the second half of the year, we expect to be very similar to the first half of the financial year, so first things first. As we go into 2025, it is too early at this stage to sort of anticipate what profitability is going to look like there. As Greg said before, some of that will be a function of whether we see any capacity rationalization on North America that, of course, is out of our control. The things that are within our control, however, ensuring that these one-off costs that we're facing at the moment and I put them into sort of two main buckets. One is the NZD 35 million we've talked about, which the Wamos, the customer care, and the triple seven dry lease costs that we're incurring. 777 dry lease will carry on, although we will get flying in exchange for that. And then, of course, we've got this NZD 50 million in sort of mainly labour productivity improvements, which are very hard to unlock until the fleet plan becomes more certain. But we'll make good progress on that. So between the two of those things, you've got sort of NZD 80 million-NZD 85 million of improvements on where we are now on a pound-for-pound basis. Of course, there'll be some more inflation coming through the business. And to the point Greg made before, it's important that we ensure that pricing reflects some of those cost increases. So we are currently working on sort of domestic pricing in particular and ancillary revenue. And they're the key areas that we'll be leaning into as we do the FY25 budget. Okay. So it would be wrong to think about a bridge to 2025 being the second half profit before taxes, sort of NZD 20 million doubling. That's NZD 40 million. Add NZD 85 million, you're sort of at NZD 125 million. You would expect a lot better than that because that's obviously quite a low number. We would expect a lot better than that. Two things will unlock that. One is obviously delivery of the new aircraft. At the moment, we've got four of our most efficient domestic aircraft, mothballed in Christchurch, currently the brand new A321neos. They will gradually work their way back into the system. They are significantly more efficient than the A320ceo, which we've talked about before. We've probably got another 18 months of the imbalance on that fleet moving anywhere between where it is now, four aircraft, as low as two, as high as five. So that is going to take some working through. As we start taking delivery of the 787s going forward, that does two things for us. It's a significant CASK improvement over the triple seven fleet we've got at the moment, and it also introduces operational simplicity into the organization. We're obviously waiting longer for that than we had anticipated. Those two aircraft were originally, per my opening remarks, originally delivering in 2023, and we were expecting to receive them in a few months' time. They now look to be arriving in the middle of 2025. But they are the key to unlocking these longer-term CASK improvements. Does that answer your question, Marcus? Yes. Yeah. No, I know you're not going to give guidance on 2025. Separately, I was a little surprised that there was a negative working capital drag in the first half given you're flying more. It does look like a reduction in ticket prepayments. Can you talk a little bit to that? Yes. There's three components to that. So obviously, that DARS lower period-on-period. The TSA balance has come down somewhat, and that's actually simply a reflection of the fact that yields have come down period-on-period. So if we sort of think about RASK, it's been a 15% RASK decline. Half of that is attributable to a big increase in the amount of long-haul flying we're doing, which obviously comes with lower CASK and lower RASK. But about 50% of that is a yield and load combination. So that's coming through your transportation sales in advance line. And then the other thing that I would mention, I think it's worthy of mentioning - we haven't called it out separately - but late last year, November, December, we made a number of significant engineering payments, particularly in December, which will have had an impact on that number. We are paying at the moment significantly more for parts and materials in the engineering division. Up about 26% over the last four years. About 26%. And of course, we're carrying slightly higher inventories of that at the moment or building inventories to deal with the engineering challenges that we've had over, well, expect to have over the next 18 months, continue to have. So that really explains sort of the operating cash working capital movement. Probably the only other thing that's worth noting in the investing cash or financing cash, rather, is we've made a couple of bullets on aircraft that were subject to JOLCO financing. For those on the phone not familiar with that, that's sort of 100% financing an airplane with a big equity bullet at the end of the 12-year loan term. So we've had 2 of those in the last period, which have had an impact on that line. Just as a FYI, Marcus, we expect to have a couple more in the second half, so that would be similar. That just adds to our unencumbered aircraft profile as well. Then I suppose just the final question. I suppose as you start to cancel these COVID credits, we've seen in Qantas a huge brand damage. Now, it's sort of different issues, but clearly, you're stepping into potentially a political hotbed during a time when you're trying to get a better outcome on regulation of the airport. Do you think you're taking the right approach with these things? Totally. So it's something we stay very, very close to, and the team are managing it extremely well. We had a different approach to Qantas right from the get-go in terms of people's ability to utilize those credits, what they could use them on, whether it had to be just a credit or could they top it up using cash or a credit card, whether it could be transferred to another person. So we were considerably more liberal in our approach from the beginning. We took a look at the appropriate time last year and said, "We need to extend this," which we've done. In the meantime, there had been any number of campaigns to contact people. We break this down to bucket, who's direct, who's indirect. Overseas credits in jurisdictions where they needed to be repaid have been repaid wherever they can. So very comfortable with our approach. I think in our guidance for the year, we've put another NZD 20 million in. We took NZD 45 million last year. We think that's a reasonably conservative and prudent approach. They actually will expire December the following year, and I'm very comfortable that by then the COVID credit thing is done. We will have done everything that we possibly can to get that used and have been very transparent about it all the way through. So Marcus, I think we're in good shape. Thanks. Just one last point worth adding to that is when we take these things as breakage through the P&L, we're not canceling people's or expiring people's credits. As Greg said, that doesn't happen for another 18 months. We get to that point and we'll actively market them, get people to use them in the intervening period. All we're doing at the moment is making an estimate of how many of these things we think are ultimately going to break. There's all sorts of reasons behind that. There'll be a bunch of people out there who have claimed insurance, sort of feel as though they've got the money back through another channel. Some are uncontactable for a variety of reasons, but we're not sort of going through the process at the moment of cancelling individuals' credits. If they ring up and want to use them, they're perfectly entitled to do that, and we'll keep doing that. Okay. Thank you. They'll be six years old by the time this process is over. Thank you. One moment. Oops. As As a reminder to ask a question, please press star one one. Again, if you'd like to ask a question, please press star one one, and one moment for our next question. Our next question comes from Grant Lowe from Jarden. Your line is now open. Hi, thank you. Can you hear me okay? Yes, Grant. Hello, Grant. Thanks. Excellent. Hey, you've touched on most of the points I was looking at. Just wondering around the you've called out this maintenance headwind of circa NZD 50 million, which I understand an issue given scheduling disruption. How do you see that profile of that sort of unwinding over the next wee while, however long that might be? Is this linked to the Pratt & Whitney issue as well, which we expect this to sort of unwind over, say, the next two years in line with the Pratt & Whitney issue? Yep. I think, Grant, that's probably a conservative estimate, but certainly, it's at least a 12-month, likely 18-month process of unwinding. And Grant. Sorry. That is more linked to labor costs than maintenance costs. So the labor costs are being held despite the fact that we are unable to do the flying schedule that we would like to do. So that productivity unlock of around NZD 50 million that Richard commented on is predominantly related to labor. The other comment he made in terms of cash and paying elevated sort of parts and maintenance work is a separate but related issue related to supply chain issues that we are currently facing within the aviation ecosystem, just to make it clear. Yes, Grant. Thank you. Yeah, that's all for now from me. Thank you. One moment, please. I'm showing no further questions. I would like to turn the call back over to Greg Foran for closing remarks. Thank you. Thanks, everyone, for joining us today. Really appreciate you listening in and for your support of Air New Zealand. If you do want to schedule a call or a meeting or you have any follow-up questions, please direct those requests through to Kim Cootes in our investor relations team. Thanks, everyone. Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.