Auckland International Airport Limited · NZX:AIA
Auckland International Airport — FY2013 Earnings Presentation
33 slides from Auckland International Airport's earnings presentation, Aug 21, 2013
Slide 1: Annual Results 2013
Annual Results 2013 Auckland International Airport Limited 21 August 2013
Slide 2: Presenters and results presentation notice
Adrian Littlewood Chief Executive Simon Robertson Chief Financial Officer This annual results presentation dated 21 August 2013 provides additional comment on the media and financial materials released before the market opened on the same date. As such, it should be read in conjunction with, and sub
Slide 3: Summary
Auckland Faster aN Higher Stronger —-_—- 2018 Adrian Littlewood Summary
Slide 4: Positive FY13 outcomes
Annual Results 2013 Positive FY13 outcomes Reported net profit after tax – up 25.1% $177.967m Positive outcomes achieved, notwithstanding some challenges to the growth momentum: Underlying profit – up 10.6% • Lapping the RWC period; $153.781m • Loss of Qantas to Los Angeles and Aerolineas Argentinas
Slide 5: Delivering on key objectives
Annual Results 2013 Delivering on key objectives Deliver positive FY13 financial results Maintain growth momentum in the business Build strong relationships with tourism industry and customers Ensure the regulatory review of our aeronautical pricing decision reflected our balanced and fair pricing a
Slide 6: Strategy for our future
Annual Results 2013 Strategy for our future 6
Slide 7: Faster, Higher, Stronger
Annual Results 2013 Faster, Higher, Stronger Adopt an ambitious and innovative Strengthen and extend our retail, Continue to improve our Build on our strong foundations approach to help New Zealand to transport and accommodation performance by increasing the for long-term sustainable growth sustaina
Slide 8: Financial outcomes
Simon Robertson Financial outcomes 8
Slide 9: Delivering profit growth momentum
Annual Results 2013 Delivering profit growth momentum 9
Slide 10: Underlying profit: $150m aspiration achieved
Annual Results 2013 Underlying profit: $150m aspiration achieved Notes: Adjustments between reported earnings and underlying earnings in the 2013 and 2012 financial years include: • We have reversed out the impact of revaluations of investment property in 2013 and 2012. An investor should monitor ch
Slide 11: Auckland's international passenger growth building
Annual Results 2013 Auckland’s international passenger growth building • Exceptional growth in Asian visitor arrivals, with China and Malaysia both recording 26.5% growth compared to 2012. • China is now the second largest source of visitor arrivals after Australia. • Domestic passenger growth of 8.
Slide 12: Auckland's international passenger growth building
Annual Results 2013 Auckland’s international passenger growth building • After a flat first half with the comparative period including the 2011 Rugby World Cup, passenger growth rebounded in the second half (3.3% growth) to record positive annual growth of 1.7%. 12
Slide 13: Aircraft movements and MCTOW
Annual Results 2013 Aircraft movements and MCTOW • International aircraft movements and MCTOW affected by the withdrawal of Qantas on Los Angeles and Aerolineas Argentinas on Buenos Aires. • Declines were slightly offset by additional services by China Southern to Guangzhou and Hawaiian Airlines to
Slide 14: Solid revenue growth
Annual Results 2013 Solid revenue growth • New aeronautical pricing from 1 July 2013 reshapes aeronautical revenue. • Completed property developments contribute to the 12.5% lift in property rental income. • Additional car park capacity and continued improvements in yield management drive 10.2% grow
Slide 15: Investing for long term growth
Annual Results 2013 Investing for long term growth • Staff costs increased in the year due to long-term incentive bonus accruals based on strong share performance and costs associated with CEO recruitment. • Increase in utility pricing, marine rescue maintenance, technology investments, car parking
Slide 16: Share of profit in NQA climbing
Annual Results 2013 Share of profit in NQA climbing • Cairns international passengers were stable with increases on routes to China, Japan and Papua New Guinea, offset by some decreases in services to New Zealand and Singapore. • Revenue was boosted by strong retail performance with 14.1% growth in
Slide 17: NQA milestones: EBITDA AU$75m achieved
Annual Results 2013 NQA milestones: EBITDA AU$75m achieved • Pleasing to achieve the key EBITDAFI target of AU$75 million, an increase of 66.8% over the 2010 financial year result of AU$45 million. • The proposed Aquis resort development at Cairns highlights the potential of the destination for Asia
Slide 18: Queenstown passenger growth continues
Annual Results 2013 Queenstown passenger growth continues • Additional services on domestic and international routes by Air New Zealand and Jetstar have increased capacity and fuelled growth. • Financial performance was strong across aeronautical, property and retail sectors. • Net profit after tax
Slide 19: Tracking our aspirational goals
Annual Results 2013 Tracking our aspirational goals How we are tracking on the achievement of our previous longer-term aspirational goals: Grow earnings above $150m by FY13 Achieved, FY13 underlying earnings $153.781m Remain #1 in Skytrax World Airports Awards for Australia/Pacific Region Achieved,
Slide 20: Balance Sheet remains in great shape
Annual Results 2013 Balance Sheet remains in great shape • Interest expense in the year was $66.689 million, down $2.269 million (3.3%), driven by lower interest cost and higher capitalised interest. • Auckland Airport issued a 7 year New Zealand bond in December 2012 at 4.73%. • Credit rating is A-
Slide 21: Investors rewarded for business performance
Annual Results 2013 Investors rewarded for business performance • Strong share price growth has rewarded shareholders with outstanding returns for the past four years. • Following last year’s change in dividend policy to 100% of net profit after tax (excluding unrealised gains and losses arising fro
Slide 22: Business performance and outlook
Adrian Littlewood Business performance and outlook 22
Slide 23: Grow Travel Markets: Aviation outlook strengthening
Annual Results 2013 Grow Travel Markets: Aviation outlook strengthening Recent announcements of growth at Auckland support the view that the aviation market is strengthening: • Emirates upgrade to A380 on Brisbane/Auckland from 2 Oct 2013; • Malaysian Airlines increase from 6 services per week to 7
Slide 24: Grow Travel Markets: Lifting industry ambition
Annual Results 2013 Grow Travel Markets: Lifting industry ambition • New Zealand has a unique opportunity to capture a larger share of the fast growing Asia-Pacific aviation market. • New Zealand could be more effective by working collaboratively to target markets. • Aligning industry on opportuniti
Slide 25: Grow Travel Markets: China Plan
Annual Results 2013 Grow Travel Markets: China Plan Our strategic review identified that while the China market was growing significantly there are issues with the value proposition for industry participants (airlines, hotels, tourism operators). However, at Auckland Airport, Chinese retail spend on
Slide 26: Strengthening our consumer business: Retail
Annual Results 2013 Strengthening our consumer business: Retail • Our international retail passenger spend rate growth stalled in FY13 as tobacco related sales fell. • Passenger spend rate excluding tobacco, grew 1.6% in FY13. • We see strong signs of continued growth in many underlying segments and
Slide 27: Strengthening our consumer business: Hotels
Annual Results 2013 Strengthening our consumer business: Hotels • Occupancy growing in FY13: – Novotel 83.2%, up from 82.0% in FY12 – Ibis Budget 83.6%, up from 60.2% in FY12 • Growing profitability at Novotel – Auckland Airport’s share of underlying profit was $1.014 million in FY13, an increase of
Slide 28: Strengthening our consumer business: Transport
Annual Results 2013 Strengthening our consumer business: Transport • Car park revenue increased 10.2% to $40.370m in FY13. • Domestic car parking utilisation increased due to passenger growth and occupancy levels. Car park product offering at Auckland Airport • In May 2013, we added 350 car parks In
Slide 29: Be fast, efficient & effective: Collaboration
Annual Results 2013 Be fast, efficient & effective: Collaboration • Successfully managing airport operations requires pro-active collaboration, data sharing and real- time information. • We are investing in systems to leverage more from collaboration with Airport Operating Systems (AOS) upgrades and
Slide 30: Invest for future growth: Building more rent roll
Annual Results 2013 Invest for future growth: Building more rent roll • The Auckland property market is recovering after a subdued 5 years and we are starting to see more active enquiry and demand. • We are striving to change the perception of Auckland Airport as a location to strengthen the workfor
Slide 31: Invest for future growth: Masterplanning
Annual Results 2013 Invest for future growth: Masterplanning • Refurbishment of the current domestic terminal is underway to provide improved gate access, baggage collection, faster security screening, a new regional lounge and two new air bridges. • Our long term future requires planning across the
Slide 32: Faster, Higher, Stronger: The outlook for 2014
Annual Results 2013 Faster, Higher, Stronger: The outlook for 2014 • Despite challenges in some source markets from slowing growth, we see the aviation market solidifying recent gains and we are therefore optimistic about the 2014 financial year. • We expect 2014 net profit after tax (excluding any
Slide 33: Questions?
Auckland Faster aN Higher Stronger —-_—- 2018 Questions?
Auckland International Airport — FY2013 Earnings Presentation on 6ix