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Auckland Airport faces $80m depreciation charge

Friday 18th June 2010

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Auckland International Airport has flagged a one-off hit on its bottom line this year because of Budget tax changes removing the ability to claim depreciation on buildings that rise in value.

An $80 million change in the company's deferred tax liability for the year to June 30 will cut reported net profit, but will have no impact on cashflows, dividends, or banking covenants, the company said.

Auckland Airport has previously forecast earnings of between $100 million and $105 million.

"The reduction in the corporate tax rate will likely offset any impact from the removal of the ability to depreciate buildings," the company said in a statement to the stock exchange.

Earlier this month, Auckland Airport announced the Qantas low-cost carrier, Jetstar, will begin daily flights from Singapore next March.

The shares rose 0.5% to $1.91 in trading today, and have declined 6.7% this year.

The government removed property investors' ability to claim depreciation on buildings in the May Budget, and expects to net some $3.1 billion over the next four years.

Businesswire.co.nz

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