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Auckland airport profit falls 51%

Thursday 21st August 2008

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Auckland International Airport, New Zealand's busiest gateway, posted a 51% drop in full-year profit, reflecting property valuation gains in the previous year. Sales rose.

Net income fell to NZ$113 million in the 12 months ended June 30, from NZ$230.9 million a year earlier, the company said in a statement today. The latest results included NZ$13.7 million of property fair value increases, from NZ$140 million in 2007.

Auckland airport abandoned efforts to find a cornerstone shareholder after the government scotched an offer from Canada Pension Plan and stock markets fell. The short-term outlook is challenging, with less growth expected in passenger numbers and rising costs, the company said today.

"Weathering the current macro-economic conditions will require great care in the next 12 months," chairman Anthony Frankham said.

Earnings in the latest period rose 3.3% to NZ$103.7 million excluding one-time items and valuation changes, the company said. On the same basis, profit is forecast to be NZ$100 million to NZ$110 million in the 2009 year, it said

"We are beginning to see signs of new international seat capacity coming into the Auckland market and we expect there will be more to come in the 2009 year," Frankham said. "Competition in the domestic market continues and we are seeing real benefits from our investment in the domestic terminal precinct."

The company spent NZ$142 million on terminals, runways, retail and property projects in the past 12 months.

Sales rose 9% to NZ$351 million as international passenger numbers rose 2.4%, domestic gained 13.2% and aircraft movements increased 2.4%.

Auckland Airport will pay a final dividend of 2.45 cents a share, fully imputed, leaving the annual payment unchanged from a year earlier at 8.2 cents.

The stock rose one cent to NZ$1.26 yesterday and has declined 33% this year.

By Jonathan Underhill

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