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Home / Business / Companies / Airlines

Auckland Airport pays $1500 staff bonus as profit soars

Grant Bradley
By Grant Bradley
Deputy Editor - Business·NZ Herald·
28 Aug, 2016 10:35 PM4 mins to read

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An Emirates A380 at Auckland Airport. The airline is one of several carriers to increase capacity through the airport.

An Emirates A380 at Auckland Airport. The airline is one of several carriers to increase capacity through the airport.

Auckland Airport is paying its staff with a $1500 bonus as its underlying profit spiked 20 per cent to $212.7 million in the past year.

Shareholders will also get an increased dividend - up nearly 20 per cent to 17.5c per share. And the airport's chief executive, Adrian Littlewood, also enjoyed a big pay rise - his remuneration, excluding exercising any share options, went up nearly 9 per cent to $1.555m.

The company's chairman Sir Henry van der Heyden, said it had been another year of growth right across the business.

''We have seen a significant lift in the number of international airlines and capacity servicing Auckland. We have added new retailers and passenger products and we have also completed several large property developments this financial year,'' he said.

''To recognise the efforts of our team and the exceptional performance in the 2016 financial year, we will pay a performance bonus of $1500 (before tax) to all permanent employees who do not participate in the short-term incentive scheme."

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One of the airport's biggest users, Air New Zealand, is also enjoying big profits on the back of the continuing tourism boom. Last week it accounced a record $463m full year profit and is also paying a staff bonus.

More than 8,200 Air NZ workers will get up to $2,500 in bonus payments.

Sir Henry said today that to support growth, Auckland Airport had started a major upgrade of its international departure area, and has continued the planning and design work required to successfully construct the 30-year vision's combined domestic and international terminal building and second runway.

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In the 12 months to June 30, the total number of passenger movements was up 9.1 per cent to 17.3m. International passengers (excluding transits) were up 8.1 per cent to 8.8 million, and domestic passengers were up 9.8 per cent to 7.9 million.

Revenue was up 12.9 per cent to $573.9m, while expenses were up 11.8 per cent to $143.6m. Earnings before interest expense, taxation, depreciation, fair value adjustments and investments in associates (EBITDAFI) increased 13.2 per cent to $430.3m.

Total profit after tax was up 17.4 per cent to $262.4m, while underlying profit was up 20.6 per cent to $212.7m.

As a result of this, underlying earnings per share was up 20.6 per cent to 17.9 cents for the 2016 financial year.

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The final dividend is 9 cents per share. This results in a total dividend this financial year of 17.5 cents per share − representing an increase of 19.9 per cent compared with last year.

The final dividend is imputed at the company tax rate of 28 per cent and will be paid on October 13 to shareholders who are on the register at the close of business on September 29.

Revenue growth was achieved, once again, through strong performances by retail (up by 19.3 per cent to $157.5m), aeronautical (landing and passenger charges up by 10.3 per cent to $258.3m) and transport (up by 11.8 per cent to $52.1m).

Operating expenses increased by 11.8 per cent to $143.6m this financial year, in part due to professional services related to our infrastructure projects, airline marketing and increased out-sourced transport and hotel activity.

Including the impact of valuation changes, the company's share of profit from associates was a loss of $8.4m. This included a share of North Queensland Airports' asset impairment of $16.0m, its fair valuation loss on financial instruments of $8.1m and its investment property revaluation gain of $1.7m, as well as its share of Novotel Auckland Airport's gain on investment property of $2.3m and its fair valuation loss on financial instruments of $100,000.

After adjusting for non-cash valuation impacts, the total share of underlying earnings from associates was $11.5m this financial year, an increase of 7.5 per cent on the previous year.

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Van der Heyden said continuing strong growth and performance meant that the company was confident it would continue to deliver strong financial results in the next 12 months.

''We expect underlying net profit after tax (excluding any fair value changes and other one-off items) for the 2017 financial year to be between $230 million and $240 million. This guidance would deliver an increase in underlying earnings per share of between 8.1% and 12.8 per cent," he said.

Guidance was subject to any material adverse events, significant one-off expenses, non-cash fair value changes to property and deterioration as a result of global market conditions or other unforeseeable circumstances.

See the Airport's latest investor presentation here:

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