Auckland Airport international terminal. Photo: RNZ / Samuel Rillstone
Auckland Airport has reported an improved first half result, though growth in passenger traffic has been more subdued than expected.
Chief executive Carrie Hurihanganui said capacity in the international market remained flat during the half-year period at 89 percent of 2019 levels, with increased competition in the market and other factors such as Air New Zealand's fleet issues.
"We welcome the government's commitment to boosting international tourism, including the new campaign to encourage visitation from Australia," she said.
Key numbers for the six months ended December compared with 2023:
- Net profit *$187.3m vs $118.7m
- Revenue $499.9m vs $440.5m
- Passengers 9.46m vs 9.3m
- Interim dividend 6.25 cents per share vs 6.75cps
- *Includes revaluation gains of $50.7m vs ($27.1m) loss
The airport's passenger traffic increased 2.3 percent, with domestic numbers up 0.1 percent to 4.3 million, and international travellers up 4.1 percent to 5.2m.
Hurihanganui said Auckland Airport was narrowing its full year underlying profit guidance to between $290m and $320m from a previous range of between $280m and $320m.
She said the airport's infrastructure development programme continued to progress and was reaffirming guidance on capital expenditure to between $1 billion and $1.3b for the year.
Regulatory pricing matters
Hurihanganui said the Commerce Commission continued to progress its review of Auckland Airport's Price Setting Event 4 (PSE4), with the final review expected to be released in the first quarter of the 2025 calendar year.
"In its draft report in July 2024, the commission concluded Auckland Airport had undergone extensive consultation with airlines on its capital plan, and that the airport's planned expenditure appeared reasonable, had significant rigour applied to it, and benchmarked well internationally," she said, though the commission also indicated Auckland Airport was targeting a weighted average cost of capital (WACC) that was higher than what it considered to be reasonable.
"We have provided further information to the commission about why we think the basis for our WACC is appropriate, however if the final report continues to say our WACC is too high we will adjust our pricing - consistent with the approach we took in the previous pricing review."
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