Passenger numbers and retailing underpinned a strong year's trading for Auckland International Airport. Profits were up more than 17% and employees will get a $1500 performance bonus.
For its year to June, AIA's total number of passenger numbers was up 9.1% to 17.3million. International passengers, excluding transits, were up 8.1% to 8.8 million and domestic passengers up 9.8% to 7.9 million.
AIA's chairman Sir Henry van der Heyden described the past year as ``an excellent 12 months'' which delivered strong results for its community, city, country and investors.
``We have seen a significant lift in the number of international airlines and capacity servicing Auckland,'' he said in a statement.
The 9c per share final dividend took the total to 17.5c for a year, a 19.9% increase.
Revenue was up 12.9% to $573.9million and expenses were up 11.8% to $143.6million. Earnings before interest expense, taxation, depreciation, fair value adjustments and investments in associates increased 13.2% to $430.3million and total profit after tax was up 17.4% to $262.4million.
Retailing again delivered a strong performance, up 19.3% to $157.5million, giving AIA confidence in constructing a new international retail hub, part of the upgrade of its international departure area, Sir Henry said.
To recognise staff efforts and the exceptional financial year, AIA will pay a before-tax performance bonus of $1500 to all permanent employees.
Sir Henry issued guidance for the current trading year, saying underlying net profit after tax for the 2017 financial year was expected in a range of $230million to $240million.
Craigs Investment Partners broker Peter McIntyre said it was an ``outstanding result'' and Sir Henry's 2017 guidance was in line with expectations for another strong passenger growth year.
The outlook for 2016 had been raised at the first half from an underlying net profit after tax of between $183million and $191million to between $200million and $206million,'' Mr McIntyre said.
Aeronautical revenue was up from $266million a year ago to $291million, retail revenue grew from $132million to $157.5million. Property rose from $50million to $59million and car park revenue rose from $47million to $52million, Mr McIntyre said.
Forsyth Barr broker Damian Foster said while AIA was a ``high quality'' company, its key challenge was to manage the growth being generated by most aspects of its business.
``The current rate of growth is not sustainable, as evidenced by Air New Zealand's capacity outlook provided last week,'' he said, noting airlines' profitability was now taking a hit from industry over-capacity.
``Consequently, we expect route development opportunities to slow significantly over the next 18 months,'' Mr Foster said.
Sir Henry said AIA's share of underlying earnings from North Queensland Airports increased by 8.2% to $7.9million, but underlying earnings from Queenstown Airport were down 6% to $1.9million, due to the settlement of its Inland Revenue litigation.
