Auckland Airport half-year profit gets a boost

Auckland International Airport says its net profit, including revaluations, shot up 58% to $187.3 million in the half year to December 31.

The company’s underlying profit was up 2% to $148.1m.

Auckland Airport’s operating earnings were up 13% at $349.6m, and the company announced a 6.5c dividend.

Chair Julia Hoare said demand for travel was solid during the half, although growth was more subdued than expected due to market conditions.

“A clear trend over the summer period is that New Zealanders haven’t lost their love of international travel, with more Kiwis travelling offshore than ever before, up 5.5% to 2.42m during the half-year compared to the same period last year,” she said.

Other bright spots were Auckland Airport achieving the busiest month for international travel since 2019 in December.

And 36,000 international travellers flowed through the terminal on January 5, the company’s busiest day in more than five years.

“Overall, however, growth in the international market has been softer than expected, particularly for inbound visitors,” she said.

Competitive market

“The global market to attract tourists is highly competitive, and that’s making it more challenging for New Zealand to secure additional airline routes and services.”

Chief executive Carrie Hurihanganui said capacity in the international market was flat during the half-year period at 89% compared to 2019 levels.

That was impacted by competition in the market and other factors such as Air New Zealand’s fleet issues.

She welcomed the Government’s commitment to boosting international tourism, including the new campaign to encourage visitors from Australia.

Hurihanganui said aeronautical and commercial activity was expected to be resilient, but uncertainty remained around seat capacity and New Zealand’s subdued local economy.

Auckland Airport narrowed its guidance of underlying profit after tax (excluding any fair value changes and other one-off items) from between $280m to $320m to a range of between $290m and $320m.

The company reconfirmed its guidance on capital expenditure of between $1 billion and $1.3b for the year.

Jamie Gray is an Auckland-based journalist, covering the financial markets and the primary sector. He joined the Herald in 2011.