Airport considers capital return

By Phil Boeyen, ShareChat Business News Editor

Friday 10th May 2002

Shares in Auckland International Airport (NZSE: AIA) traded higher on Friday after the company reported a third quarter profit of $18.3 million and said it was considering returning $212 million to shareholders.

The quarterly result for the three months ended March brings the company's nine month after tax profit to $53.4 million. Interim profit was $35.1 million.

"The recovery of passenger flows post-September 11 has continued to gain momentum," the company says.

"International passenger movements for the quarter ending March recorded a 5.4% increase against the same period last year. Domestic passenger numbers also showed a positive trend in the March quarter, being 7.4% ahead of the same time last year."

The directors say that given the latest results they remain confident of achieving full year profit estimates.

AIA also reported that retail revenues will be boosted later this year after a successful re-tendering process for the major retail concessions at the International Terminal building.

"The attractiveness of the airport as a retailing environment resulted in strong bidding in this process and a significant increase in the guaranteed amounts payable to the company.

"This increase equates to approximately $15 million a year in additional retail concession revenue. The new five-year contracts commence in mid-October 2002."

The directors also announced to the market that they are considering a capital repayment of around $212 million, with a view to achieving a more efficient balance sheet and maximising shareholder value.

"The directors wish to ensure that the company retains a strong credit rating, is appropriately geared, and that any capital is returned on a pro rata and tax efficient basis."

The repayment is envisaged sometime in September or October and will be in addition to the final year dividend for the year ended June 2002.

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