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Air New Zealand says it expects to lose up to $75 million in profits because of the COVID-19 coronavirus fallout.

Air NZ anticipating $75 million hit from coronavirus impact

Air New Zealand says it expects to lose up to $75 million in profits because of the COVID-19 coronavirus, which has infected 78,914 people worldwide to date.

Demand for flights to and from Asian destinations has dropped because of the virus and today the airline revised its earnings forecast for the 2020 financial year.

"While the situation is uncertain, based on our current assumptions of lower demand as well as the benefit of the announced capacity reductions and lower jet fuel prices, the airline currently expects a net negative impact to earnings in the range of $35 million to $75 million as a result of coronavirus," the airline said in a statement.

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Air NZ says it anticipates earnings of $300 million to $350 million; it had previously forecast $350 million to $450 million.

It also announced services to Seoul will be temporarily suspended from 7 March through the end of June. It has already reduced services to Shanghai and Hong Kong. The airline expects total Asia capacity will decline 17% from February to June, transTasman flights to drop 3 percent and domestic flights by 2 percent.  

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The ban on foreign travellers arriving into New Zealand from mainland China is likely to be extended, Prime Minister Jacinda Ardern said.

New Zealand citizens, permanent residents and their immediate family are excluded from the ban, but must self-isolate for 14 days after arrival.

Air NZ's shares dropped 6c or 2 per cent in response to the revision.

The airline will release its 2020 Interim Results to the market on Thursday 27 February.

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