(Reuters) -Air New Zealand ( ANZFF ) posted a 61% drop in its annual earnings on Thursday, hurt by stiff competition and high inflationary pressure, which is impacting travel demand in its domestic as well as in the North American market.

New Zealand's flagship carrier has been grappling with stiff pricing competition from its U.S. counterparts, persistent high inflation and unexpected global engine maintenance requirements from Pratt & Whitney.

The airline reported earnings before tax of NZ$222 million($138.55 million), down from NZ$574 million a year ago.

The result beat a Visible Alpha consensus estimate of NZ$176.7 million.

It declared a final dividend of 1.5 New Zealand cents per share for fiscal 2024.

($1 = 1.6023 New Zealand dollars)