KEY POINTS:
Costs related to last year's takeover bids have contributed to a soft landing for half-year profits at Auckland International Airport.
Net profit after tax for the six months ending December 31 fell 3.9 per cent to $47.6 million. The company attributed the drop to $5.8 million in costs linked with the various ownership proposals considered during the past year, combined with increased interest and depreciation charges.
Last year, two bids were made for control of the airport. One by Dubai Aerospace failed, the other partial takeover bid by Canadian Pension Plan Investment Plan (CPPIB) is still live.
After adjusting for the takeover costs and the reduction in the company's long-term incentive plan, profit after tax increased 5.1 per cent to $52.1 million.
The company saw solid growth in revenue and operating earnings, with double digit revenue growth in its retail, rental and car parking businesses. Total revenue for the first half was up 7.9 per cent to $172.3 million.
While the long-term outlook remains positive with the completion of renovations to the domestic terminal, improvements to the international terminal and the start of construction of the second runway, the short term remains murky with a slowing of passenger numbers, and uncertainty over the outcome of the CPPIB bid.
Speculation is rife that the board is moving towards revising its recommendation that shareholders reject the offer in light of the sharemarket's drop. The airport's shares have been hovering around $1 below the $3.6555 offer since the start of the year.
Auckland Airport chief financial officer Robert Sinclair said no decision has been made to revise the board's recommendations on the Canadian offer, which would come on or before March 6.
"The board is aware of the importance of providing timely advice to shareholders, therefore it is certainly conceivable that an updated advice is given before that time."
One analyst, who did not want to be named, said the airport board would be under pressure to reconsider its stance.
"There is a growing suspicion that the directors may reconsider their view given the way the markets have fallen."
He saw two positives in yesterday's result: The rise in concession revenues per passenger, and that the biggest growth came from sources such as retail and parking, not aeronautical charges.
Forsyth Barr analyst Jeremy Simpson said the results were in line with expectations. "The feature of the result for us was the good growth in non-aeronautical revenue."
A fully imputed interim dividend of 5.75c per share was declared, compared with last year's 3.75c per share. The company approved the 2c increase in the order to use the surplus imputation credits that would be lost if the Canadian takeover was successful. The expected final dividend was expected to be reduced by the same amount.
The offer price under the Canadian offer will be reduced accordingly to $3.598 per share.
Shares closed at $2.83, up 8c.
