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Wellington Airport lifts annual earnings on passenger growth

Thursday 16th May 2019

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Wellington International Airport lifted annual earnings 6.3 percent as the capital city's gateway continued to benefit from rising passenger numbers. 

Earnings before interest, tax, depreciation and amortisation rose to $101.4 million in the year ended March 31, from $95.4 million, with revenue up 7.2 percent at $137.9 million. The airport processed 5.5 million domestic passengers in the year, up 4.6 percent from a year earlier, and more than 929,000 international passengers, an increase of 3.8 percent.

Aircraft and terminal charges were up 7 percent at $81.5 million, retail and trading income rose 8.1 percent to $43.5 million. Property income, which included the mid-February opening of the Rydges Hotel, increased 5.2 percent to $12.9 million. 

The airport is 66 percent-owned by Infratil, which is due to report its annual earnings tomorrow, and Wellington City Council. Infratil takes a subvention payment in lieu of a dividend, and received $40.5 million for the 2019 financial year, up from $37.9 million. The council's dividend rose to $12.6 million from $11.9 million in 2018. The local authority also received $3.3 million in rates, up from $3.1 million. 

Net profit fell to $23.5 million from $24.7 million, principally due to a smaller increase in the unrealised value of its property portfolio. The fair value gain of $4.8 million compared to an $11.5 million gain in 2018. 

The airport operator recently completed a $300 million, five-year investment programme, including development of new parking facilities and the Rydges Hotel. Infratil last month flagged expected capital spending of about $100 million for the 2020 financial year. 

"Looking to the future, the airport is currently developing its masterplan to address forecast growth and the challenges and opportunities that presents. The draft plan is currently being consulted on with airlines," the company said today in its annual review.

Last month, it withdrew its application for consent to extend its runway after the Civil Aviation Authority said a new modelling tool for the proposed Runway End Safety Areas should be applied to the project. 

"While a difficult decision to make, it has provided the airport, airline customers and decision-makers with clarity and certainty," the company said. "It is critical to get this vital safety feature right and ensure our application is robust."

Two of the airport's five listed debt securities traded today. Its 2021 bonds, paying annual interest of 6.25 percent, traded at a yield of 2.52 percent, down 3 basis points. Its 2024 bonds, paying 4 percent, traded at a yield of 2.95 percent, down 5 basis points. 

(BusinessDesk)

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