23 Feb 2013

Auckland Airport reports $77m profit

12:40 pm on 23 February 2013

Auckland International Airport has reported a better than expected half year result due to domestic passenger growth.

The company's $76.9 million profit for the six months to December was 11.3% higher than the same period the previous year.

Stripping out one-off items, underlying profit rose 7.5% to $76 million.

Revenue rose nearly 3.6% to $223.5 million following a strong performance from its car parking business. Costs also increased nearly 4.9% to $57.2 million due to continued infrastructure investment and an ongoing regulatory process.

Auckland Airport is the country's main international gateway with about 70% of arrivals and departures.

Chief executive Adrian Littlewood said domestic passenger volumes grew by 7.2%.

International passenger volumes declined by 1.8%, as transit passenger numbers fell due to Qantas and Aerolineas Argentinas pulling out of some routes through Auckland. The Rugby World Cup had taken place in the previous six-month period and numbers were down in comparison.

However Mr Littlewood said there were early signs of a recovery in overseas traveller numbers with rises in both November and December last year.

Full year profit guidance lifted

Mr Littlewood said challenges still remain in the aviation market but the airport has lifted its expectation for the full financial year to a profit of $145 - $153 million.

"We expect capital expenditure to be around about $90 to $100 million and that's a change from our previous guidance of $100 to $110 million."

Mr Littlewood said that change is about the timing of some investments, such as the domestic terminal refurbishment which started slightly than expected.

He said the airport is also seeing some benefits from a softer construction market which has lead to better pricing on some projects.

The company will pay an interim dividend of 5.75 cents per share.

Shares in Auckland International Airport were unchanged at $2.75 on Thursday.