Auckland International Airport Limited · NZX:AIA
Auckland International Airport — Non-Deal Roadshow (September 2016)
44 slides from Auckland International Airport's roadshow presentation, September 2016
Slide 1: Investor Roadshow
Investor Roadshow September 2016 Adrian Littlewood Chief Executive Delivering results Philip Neutze From 1966 - 2016 Chief Financial Officer
Slide 2: Agenda
Agenda 2016 Investor Roadshow Page 1. Highlights 3 2. Company overview 5 3. Strategy for our future 20 4. Financial information 29 2
Slide 3: Auckland Airport at a glance
Auckland Airport at a glance 2016 Investor Roadshow 17.3 million 91 % share of long haul arrivals to New Zealand annual passengers 26 international Auckland Airport airlines announced in 2016 74% share of international visitors to New Zealand 4 international freight airlines 44 international 157,000
Slide 4: Why invest in Auckland Airport?
Why invest in Auckland Airport? 2016 Investor Roadshow Largest listed corporate in New Zealand with a market capitalisation of NZ$8.0 billion (US$5.9 billion) and debt of NZ$1.9 billion (US$1.4 billion)1 Second most highly traded stock on NZX10 by value over the last twelve months2 Five year a
Slide 5: Company overview
MOWI9/AO Aueduwios
Slide 6: Robust momentum in the New Zealand economy
Robust momentum in the New Zealand economy 2016 Investor Roadshow Gross domestic product (real) • The New Zealand economy has strong Quarterly growth and annual growth momentum supported by high inward 1.6% 3.7% migration, construction and tourism activity 1.3% 2.9% combined with supportive monetary
Slide 7: Auckland is one of the fastest growing regions
Auckland is one of the fastest growing regions 2016 Investor Roadshow • Auckland accounts for 36.6% of New GDP growth by region1 Zealand’s GDP and is unique in the world in its 11.0% scale to the national economy1 9.0% • With an estimated population of 1.6 million 7.0% people, the Greater Auckland r
Slide 8: Regulatory environment
Regulatory environment 2016 Investor Roadshow Overview • Dual-till regime, with the aeronautical segment (1st till) subject to information disclosure regulation under the Commerce Act 1986 • Disclosure regime includes monitoring of service standards, asset availability, capital expenditure plans, ef
Slide 9: Auckland Airport is the busiest in New Zealand
Auckland Airport is the busiest in New Zealand 2016 Investor Roadshow Busiest international airports by passenger numbers • 74% of international passengers to New Zealand arrive or depart from Auckland Airport and 91% of total long haul arrivals Auckland 16.682 million • Auckland Airport is the only
Slide 10: Auckland Airport
Auckland Airport 2016 Investor Roadshow • Auckland Airport is the fourth busiest airport in AIA stock price vs NZX50 and ASX200 Australasia $8.50 Share price, 14 Sep-16 ($) 6.74 Share price / Index Value (NZ$) Number of shares (m) 1,191 $7.50 • It is one of New Zealand’s most important Market capita
Slide 11: Connecting New Zealand to the world
Connecting New Zealand to the world 2016 Investor Roadshow Auckland Airport connects New Zealand to 44 international destinations Aeronautical Retail London Vancouver Property Beijing San Francisco Tianjin Seoul Tokyo Los Angeles Chongqing Houston Dubai Shanghai Osaka Doha Guangzhou Taipei Honolulu
Slide 12: Proven passenger growth
Proven passenger growth 2016 Investor Roadshow Total Passengers at Auckland Airport (excl. Transits) Aeronautical 18,000,000 16,000,000 Sub Prime Christchurch 14,000,000 Retail Crisis and Earthquake Global Avian Flu Recession 12,000,000 Outbreak SARS Annual passengers Outbreak Property 10,000,000 Se
Slide 13: Compares favourably to Australasian airports
Compares favourably to Australasian airports 2016 Investor Roadshow FY16 passenger growth rates % International vs domestic passenger mix Aeronautical 12.0% Brisbane 5,260 17,200 9.5% 9.8% 10.0% Christchurch 1,549 4,757 8.1% 7.5% Retail 8.0% 7.1% 6.2% Melbourne 9,165 24,711 6.0% 3.8% 4.1% 3.7% 4.0%
Slide 14: Diverse retail offering
Diverse retail offering 2016 Investor Roadshow • The retail business operates through concessions Aeronautical • 103 retail stores located across the domestic and international terminals with a growing and affluent footfall1 Retail • 8 retailers also available through Auckland Airport’s online marke
Slide 15: Strong car park growth
Strong car park growth 2016 Investor Roadshow • Auckland Airport provides travellers and staff with 11.6% Averagespace revenue per Aeronautical in FY16 ~10,000 parking spaces • Options range from premium valet to Park&Ride at different price points 11.8% Car parking revenue in FY16 Retail Spaces at
Slide 16: Significant land holdings
Significant land holdings 2016 Investor Roadshow Aeronautical Retail Property Auckland Airport boundary Central Park, New York • Auckland Airport owns approximately 1,500 hectares of freehold land (~300 hectares available for investment property development) • Vacant land enables staged and affordab
Slide 17: Extensive investment property portfolio
Extensive investment property portfolio 2016 Investor Roadshow Investment property • Auckland Airport owns $794m of investment 12.3% Aeronautical rent roll in FY16 property (excl. undeveloped land) with a $63.0m rent roll at 30 June 2016 • One of the most active developers in the 5.9 years Weighted
Slide 18: Hotel occupancy increasing
Hotel occupancy increasing 2016 Investor Roadshow • Auckland Airport has a coherent suite of hotel Aeronautical products including plans additional hotels as demand for accommodation increases • Novotel Hotel is a 263 room 4+ star hotel Retail – Auckland Airport holds a 20% stake and collects ground
Slide 19: Associates
Associates 2016 Investor Roadshow Queenstown Airport – New Zealand (24.99% ownership) • Queenstown Airport is the gateway airport to New Zealand’s adventure capital, a major tourist destination and the fourth busiest airport in New Zealand • In FY16, Queenstown airport handled 1,176,330 domestic and
Slide 20: Strategy for our future
Strategy for our future
Slide 21: Our strategy
Our strategy 2016 Investor Roadshow Adopt an ambitious and innovative approach to help New Zealand to sustainably unlock the growth opportunities in travel, trade and tourism Strengthen and extend our retail, transport and accommodation businesses to ensure we can respond to evolving customer needs
Slide 22: Delivering on our ambitions
Delivering on our ambitions 2016 Investor Roadshow In 2013 we established several ambitious targets under our Faster, Higher, Stronger growth strategy Aspirations: How we tracked in FY16: 400,000 359,270 Double Chinese arrivals to 400,000 An increase of 66,835 in FY16 by FY17, up from 213,781 in FY1
Slide 23: Collaborative strategic framework
Collaborative strategic framework 2016 Investor Roadshow Grow travel markets by working with partners across the whole value chain Grow travel markets consumer business Strengthen our Be fast, efficient and effective Invest for future growth 23
Slide 24: Ongoing network analysis
Ongoing network analysis 2016 Investor Roadshow Network analysis exposes underserved demand Grow travel markets China is S. Korea is Canada is Hong Kong is 41% 56% 41% 34% underserved underserved underserved consumer business underserved Strengthen our UK is 48% USA is underserved Japan is Germany i
Slide 25: Successfully growing travel markets
Successfully growing travel markets 2016 Investor Roadshow Strong growth in connectivity during FY16 Grow travel markets • Strong international growth driven by enhanced connectivity to established, emerging and new markets: – 8 new international airlines launched or announced during FY16 consumer b
Slide 26: Strengthening our consumer business
Strengthening our consumer business 2016 Investor Roadshow Retail step change driven by new larger space Grow travel markets • Continued to add new brands and stores that meet objective of ‘best of NZ and world’ retail e.g. Kiehls, Jo Malone, Urban Decay, Victoria Secret (first in NZ) consumer busin
Slide 27: Operational innovation
Operational innovation 2016 Investor Roadshow • Strategy focused on driving high quality customer International departure 4.1% processing time Grow travel experience and operational efficiency by markets increasing the productivity of our assets, processes and operations • Applying a ‘total airport
Slide 28: Investing for future growth
Investing for future growth 2016 Investor Roadshow • Bold 30-year vision developed with international Grow travel markets experts (www.airportofthefuture.co.nz) • Vision based on a combined domestic and international terminal as well as an efficient, consumer business affordable and staged developme
Slide 29: Financial information
Financial information
Slide 30: FY16 results at a glance
FY16 results at a glance 2016 Investor Roadshow Revenue Passenger movements 12.9% $573.9m 9.1% 17.3m International 8.8m up 8.1% | International transits 0.6m up 17.2% Domestic 7.9m up 9.8% Operating EBITDAFI Retail income 13.2 % $430.3m 19.3% $157.5m Underlying profit Investment property rent roll 2
Slide 31: Strong five year financial performance
Strong five year financial performance 2016 Investor Roadshow For the year ended 30 June 2016 2015 2014 2013 2012 NZ$m Revenue 573.9 508.5 475.8 448.5 426.8 Expenses 143.6 128.5 120.6 117.6 107.5 Earnings before interest, taxation, depreciation, fair value adjustments and investments in 430.3 380.0
Slide 32: Significant growth in passengers
Significant growth in passengers 2016 Investor Roadshow Passenger movements 20.0 18.0 16.0 14.0 7.9 12.0 7.2 Millions 6.8 6.9 6.2 10.0 0.6 8.0 0.5 0.5 0.6 0.4 6.0 4.0 4.4 3.6 3.7 3.8 4.0 2.0 3.6 3.7 3.8 4.1 4.4 0.0 2012 2013 2014 2015 2016 International arrivals International departures Transit pass
Slide 33: Runway movements growing
Runway movements growing 2016 Investor Roadshow Aircraft movements 180,000 160,000 140,000 Domestic aircraft 120,000 movements 100,000 110,421 110,832 107,454 104,264 107,929 80,000 60,000 International aircraft 40,000 movements 20,000 45,094 44,314 45,809 46,692 49,825 0 2012 2013 2014 2015 2016 MC
Slide 34: Strong revenue growth across the business
Strong revenue growth across the business 2016 Investor Roadshow Revenue by segment For the year ended 30 June 2016 2015 2014 2013 2012 CAGR $m Airfield income 103.4 93.3 87.6 81.6 77.3 7.5% Passenger services charge 154.9 140.9 131.5 120.2 83.1 16.8% Terminal services charge - - - - 28.6 n/a Retail
Slide 35: Delivering operational leverage
Delivering operational leverage 2016 Investor Roadshow For the year ended 30 June 2016 2015 2014 2013 2012 CAGR $m Staff 46.8 46.3 42.5 40.0 34.3 8.1% Asset management, maintenance and airport 49.1 44.2 40.3 39.6 36.7 7.5% operations Rates and insurance 11.5 10.7 10.1 9.7 9.1 6.0% Marketing and prom
Slide 36: Associates' performance
Associates’ performance 2016 Investor Roadshow For the year ended 30 June 2016 2015 2014 2013 2012 CAGR NZ$m Queenstown Airport (24.99% ownership) Total Revenue 31.5 24.8 21.9 19.6 18.2 14.7% EBITDAFI 21.5 16.6 15.2 12.9 11.5 16.9% Domestic Passengers 1,176,330 1,000,713 940,477 957,204 851,795 8.4%
Slide 37: Summary balance sheet
Summary balance sheet 2016 Investor Roadshow For the year ended 30 June 2016 2015 2014 2013 2012 $m Cash 52.6 38.5 41.4 69.2 42.8 Trade and other receivables 42.3 36.6 29.0 26.8 23.1 Other current assets 8.0 12.3 3.2 3.6 3.4 Current assets 102.9 87.4 73.6 99.6 69.3 Property, plant and equipment 4,70
Slide 38: Summary cash flow
Summary cash flow 2016 Investor Roadshow For the year ended 30 June 2016 2015 2014 2013 2012 $m Receipts from customers 569.5 500.6 471.6 441.9 428.5 Payments to suppliers and employees (151.2) (116.0) (116.4) (112.1) (106.0) Interest & tax paid (147.8) (162.4) (143.6) (122.0) (125.8) Net cash flow
Slide 39: Credit metrics
Credit metrics 2016 Investor Roadshow For the year ended 30 June 2016 2015 2014 2013 2012 Debt / debt + market value of equity 19.7% 22.5% 24.7% 22.8% 25.8% Funds from operations / gross debt 16.2% 16.6% 20.8% 20.7% 19.8% Funds from operations interest cover 4.6x 3.9x 4.5x 4.2x 3.9x Weighted average
Slide 40: Capital expenditure
Capital expenditure 2016 Investor Roadshow 400 350 2016 2015 Change For the year ended 30 June $m $m 300 250 Renewal 18.4 13.7 34.3% Capex $m 200 Growth 224.8 133.9 67.9% 150 Total capital expenditure 243.2 147.6 64.8% 100 50 Depreciation 73.0 64.8 12.7% 0 FY12 FY13 FY14 FY15 FY16 FY17 Actual Guidan
Slide 41: Outstanding shareholder returns
Outstanding shareholder returns 2016 Investor Roadshow Annual shareholder returns 40% Five year average total 35.0% shareholder return of 33.7% 35% 30.4% 30% 26.6% 26.1% 25% 20% 14.1% 15% 10% 5% 0% FY12 FY13 FY14 FY15 FY16 Dividend Share price Average • Strong share price growth has rewarded shareho
Slide 42: Outlook
Outlook 2016 Investor Roadshow Guidance Supportive macro environment • Ongoing strong growth and performance means that Travel industry benefiting from we are confident that the Company will again deliver continued favourable drivers strong financial results in the next 12 months Strong aircraft
Slide 43: Reference material and further details
Reference material and further details 2016 Investor Roadshow Reference material Auckland Airport website: https://corporate.aucklandairport.co.nz/ Commerce Commission: http://www.comcom.govt.nz/regulated-industries/airports/ ADR overview: https://corporate.aucklandairport.co.nz/investors/shares-and
Slide 44: Important Notice and Glossary
Important Notice and Glossary 2016 Investor Roadshow Disclaimer This presentation is given on behalf of Auckland International Airport Limited. Information in this presentation: • is provided for general information purposes only, and is not an offer or invitation for subscription, purchase, or reco
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