Tourism surge boosts airport

By CHRIS DANIELS

The good times keep rolling for Auckland Airport and buoyed by surging tourism growth and airline expansion it is ready to increase payouts to shareholders.

Despite plans for $75.4 million in capital expenditure during the coming year, the airport company is lifting its dividend payout, with 90 per cent of after-tax profits going back to shareholders.

A nearly 14 per cent jump in international passenger movements, coupled with a 14.4 per cent increase in domestic travellers, lifted revenue and profits. Next year's profit is expected to top $100 million.

Chief executive Don Huse said yesterday that the looming need for big ticket spending at the airport would not put any undue pressure on the company's finances.

In the next year, 12 new international check-in counters would be built, along with more office space.

A new international apron with "hard stands" to park aircraft would also be built.

A $48 million project to separate incoming and outgoing international passengers was due to be finished next year and a new $45 million link from the international terminal to the new "hard stands" was also on the books.

These expansion projects - which would account for $375 million over the next three years, would be were based on the expected jump in passenger numbers.

In the past year revenue had jumped in all parts of the business, aeronautical and non-aeronautical.

But the money earned from retail operations had not matched the increase in passenger numbers, which Huse put down to factors such as security checks and queuing putting pressure on "dwell times" - when passengers went shopping.

New, cheaper air fares had also seen a big increase in travel lower socio-economic groups, who were not likely to shop heavily at the airport.

The company completed retail bond issue which raised $200 million raised to refinance existing debt for the airport's capital programme and for general funding.

Airlines increased capacity into Auckland by up to 30 per cent last summer, but Huse said this figure was unlikely to be repeated during this peak season.

He said the 30 per cent more seats was accompanied by a 15 per cent passenger increase, so the airlines were more likely to try and increase load factors rather than moving to put on more planes.