Auckland International Airport Limited · NZX:AIA
Auckland International Airport — FY2010 Earnings Presentation
29 slides from Auckland International Airport's earnings presentation, Aug 26, 2010
Slide 1: Auckland Airport annual results to June 2010
Auckland Airport 2010 annual results | 26 August 2010 Auckland Airport annual results to June 2010 1
Slide 2: Notes
Notes This annual results presentation dated 26 August 2010 provides additional comment on the media and financial materials released at the same date. As such, it should be read in conjunction with, and subject to, the explanations and views provided in that release. 2
Slide 3: Simon Moutter and Simon Robertson
Simon Moutter Chief Executive Simon Robertson Chief Financial Officer 3
Slide 4: Reinventing our business
Reinventing our business Re-focused from airport infrastructure manager to a sales- led engine of economic growth Redirected resources into promoting New Zealand as a destination to fuel growth in travel, trade and tourism Expanded Australasian footprint to increase influence with airlines and agenc
Slide 5: 2009 saw growth strategy launched
2009 saw growth strategy launched The primary goal of our strategy is to accelerate business growth at Auckland Airport In 2009 travel demand and economy was at a low and we weren’t sure where was bottom Extra investment in air-services development had yet to bear any significant fruit Lean Six Sigm
Slide 6: The market has changed in 2010
The market has changed in 2010 Travel demand beginning to rebound from recession June 2010 vs. June 2009 Growth economies (especially Asia) Revenue Available Region pax km seat km becoming increasingly important Africa 21.3% 12.1% Aviation sector still challenged but in Asia/Pacific 15.5% 4.4% healt
Slide 7: The plan is taking shape
The plan is taking shape High passenger satisfaction - 9th best airport in world in Skytrax Significant air-service sales achieved: • More than 850,000 additional international seats announced for Auckland • More than 800,000 additional international and domestic seats announced for Cairns & Mackay
Slide 8: The 2010 financial results in full
The 2010 financial results in full Results Overview Passenger volumes International passenger market trends Aircraft movement trends Income Expenses Profit Balance sheet Debt ratios Capital expenditure NQA financial results summary Dividends 8
Slide 9: Results overview
Results overview 2010 2009 % $m $m Change Income 363.1 368.3 -1.4 Expenses 86.8 88.9 -2.3 EBITDAFI (Earnings before interest, taxation, depreciation, 276.3 279.4 -1.1 fair value adjustments and investments in associates) Share of profit of associates 0.1 0.9 -89.7 Investment property fair value gain
Slide 10: Passenger volume growth in 2010
Passenger volume growth in 2010 Strong domestic passenger volume with 7.8% growth International passenger numbers grew from September 2009. Full year international passenger (excl Transits) growth of 2.4% Particularly strong trans-Tasman with 10.6% growth Asian passengers in the second half of 2010
Slide 11: Resilient international markets
Resilient international markets Additional trans-Tasman carriers and routes increased Australia arrivals to 19.5% (2009: 18.1%) of all international arrivals Asia and North America have been resilient through the downturn, maintaining percentage of arrivals at 10.1% and 6.1%, respectively Arrivals f
Slide 12: Aircraft movement trends
Aircraft movement trends Airline fleet management has, in general, seen more frequent, smaller aircraft on international routes and less frequent, larger aircraft on domestic routes Pacific Blue have announced their withdrawal from domestic routes in October 2010. In 2010, Pacific Blue domestic MCTO
Slide 13: Strength in our core revenues
Strength in our core revenues Growth in international passenger 2010 2009 % and price increase deliver a 10.1% $m $m change increase in PSC Airfield 66.7 70.5 -5.3 Deferral of airport charge increase Passenger services charge 73.3 66.5 10.1 to 1 March 2010 had $2.7m impact Terminal services charge 2
Slide 14: Operating leverage at work
Operating leverage at work Restructuring in 2009 set platform for focus on proactively managing costs Restructuring costs substantially lower in 2010 by $3.1m Cost savings in other expenses of $3.0m achieved across a range of expense items $2.7m of the $3.0m savings redirected to the marketing of ai
Slide 15: Underlying profits held up
Underlying profits held up 2010 2009 % change $m $m Reported net profit after tax 29.7 41.7 -28.8 Investment Property Revaluation (9.5) 64.6 Restructuring costs - 4.2 Deferred tax adjustment 84.4 - Tax effect 0.4 (4.6) Underlying Profit 105.1 105.9 -0.8 The deferred tax adjustment of $84.4 million i
Slide 16: Stable balance sheet
Stable balance sheet Two bond issues in FY10 raising $150 million at very attractive pricing S&P rating A- /A2 (stable outlook) Management are already looking at refinancing options for maturities in the next 12 months Modest increase in debt with investments also funded by Debt is based on contract
Slide 17: Robust debt ratios
Robust debt ratios 2010 2009 Average Interest Rate 6.86% 7.52% Underlying EBITDA interest cover ratio 3.73 3.57 Average debt maturity (years) 3.17 3.30 Debt to Debt + Equity 36% 37% Fixed interest rate exposure 74% 79% Reduced percentage of fixed rate debt enables benefits from lower interest rates,
Slide 18: Capital expenditure
Capital expenditure Total capital expenditure at $54.3m down 38.0% from prior year and broadly in line with depreciation Significant change in capital expenditure from aeronautical investments in capacity, to profit- oriented non-aeronautical investments 2010 $m Aeronautical 12.3 Property 11.9 Retai
Slide 19: NQA financial results
NQA financial results Highlights: Actual Forecast Improvement FY10 FY10 Milestones • Technical Services Agreement with QAL terminated Operating A$ 45.6m A$ 45.0m FY11 A$55.0m EBITDA FY13 A$75.0m • Pacific Blue entered and Jetstar Non Aeronautical A$ 30.2m A$ 29.8m FY11 A$34.0m announced to enter dir
Slide 20: Dividends and the DRP
Dividends and the DRP Final dividend of 4.45 cps, bringing total dividend for the year to 8.2 cps Dividend payout ratio of 102% of underlying profit. Formal dividend policy remains at 90% Record date for dividend is 8 October 2010 to be paid on 22 October 2010 Launched DRP for the first time in Marc
Slide 21: Drivers of growth: 2011 and beyond
Drivers of growth: 2011 and beyond Growing airline passenger capacity to drive future passenger growth Increasing aeronautical revenue Improving retail yield Investing in property development Managing capital expenditure Outlook for 2011 21
Slide 22: Growing Auckland international capacity
Growing Auckland international capacity New service Singapore Mar 2011 220,000 New service Melbourne Dec 2010 130,000 New service Cairns Apr 2011 56,000 New service Houston Nov 2011 138,000 Upgrade (A340 to 777) Melbourne Aug 2010 72,000 Brisbane Dec 2010 72,000 New service Cairns Mar 2010 37,000 In
Slide 23: Growing Cairns & Mackay capacity
Growing Cairns & Mackay capacity New service Osaka Apr 2010 126,000 New service Sydney Apr 2010 63,000 Increased frequency Melbourne Apr 2010 128,000 Increased frequency Sydney Apr 2010 128,000 Increased frequency Adelaide Mar 2010 36,000 Increased frequency Perth Mar 2010 36,000 New service Aucklan
Slide 24: Increasing aeronautical revenue
Increasing aeronautical revenue 24
Slide 25: Improving retail yield
Improving retail yield 2010 retail revenues impacted by construction disruption Completion of duty-free stores on departures in May reduced disruption impact on this category and showing strong initial results Some disruption still expected in 2011 but impact more modest and benefits of completed wo
Slide 26: Investing in property development
Investing in property development Project Construction Value Auckland Airport Expected ($m) Construction Cost Completion ($m) Mercedes 3.0 3.0 Mar 2011 DSV Air and Sea 3.8 3.8 May 2011 Aviation Travel and Training 3.5 3.5 Jun 2011 NZ Food Innovation Centre Manukau 7.9 7.9 Aug 2011 Aviation Security
Slide 27: Managing capital expenditure
Managing capital expenditure Forecast excludes yet to be Forecast 2011 committed property $m development Aeronautical 20.0 Property 50.0 Retail first-floor development to Retail 12.0 be completed in December 2010 Car parking 1.0 Property capital expenditure Infrastructure and other 2.0 excludes the
Slide 28: 2011 and beyond: cleared for take-off
2011 and beyond: cleared for take-off We expect 2011 profit in the range of $112 to $118 million assuming international passenger growth in the order of 5% (excluding any fair-value changes and other one-off items) Double digit profit growth is a possible outcome of strategy by: Growing airline pass
Slide 29: Questions please
Bilaipon® QUESTIONS PLEASE Biiicsand Bl aicon Top 10 Airport 2009, 2010
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